Two non-competing companies with the same name

January 24, 2011 3:53 PM

What are the legal implications of giving a company the same name as a company in a different business?

I'm starting a very small (as in, I'll be the only employee and I don't expect to make money on it) literary publishing company. I've decided, as sort of a meta-joke, to name the company after an existing one. About this company:

- It has a name of the form, [street name] [business type]. Let's call it Bluxome Flowers (but that's not it).
- Bluxome Flowers doesn't do anything literary or artistic.
- Bluxome Flowers doesn't have any "cool" connotations. It's not like I'm trying to name my press Hotel Chelsea Books or something like that.
- There is more than one Bluxome Flowers in America. As far as I can tell, they are not connected to each other in any way.
- I've registered the domain name bluxomeflowers.com. It's not on archive.org, so I assume I'm the first person ever to register it.

Is there any danger in doing this? The silliness of it (confusing Google results, etc.) is part of what's appealing to me about it, but I can't imagine it having any adverse effect on the real Bluxome Flowers. Will anyone sue me?

posted by roll truck roll to law & government (7 answers total)

I am not qualified at all to answer the question of whether someone can sue you and win, but depending on the mood (and financial state) of the original company, they can absolutely sue you, regardless of whether they have a case, and you will still have to defend yourself, which means paying a lawyer a lot of money, or settle, which means paying the original company a lot of money -- it doesn't matter if that company is in the right or not. If they are a big company, they can make you really unhappy if they want to. Some companies make a habit of doing this even when they don't have a case.
posted by brainmouse at 3:57 PM on January 24, 2011

For the most part, if you're "trading" in a different class of goods or services you'll be fine, but this will probably vary from jurisdiction to jurisdiction. Go to uspto.govt and search for variations of the name you'll be trading under and see if there are any conflicts in the same goods or services.

Your company isn't going to have any assets by the sounds of it, so it's not like there'll be anything to sue for except an injunction to stop publishing under a certain name, which may mean you've lost out the cost of the domain name registration, but even this will be unlikely, as you're not going to be doing a whole lot that infringes.

You may want to have a quick read about passing off.

Trade mark law is pretty much centred around the likelihood of consumer confusion, so if there's little to no chance of a consumer being confused that you are affiliated in some way with the other Bluxome Flowers you shouldn't have any problems. However, you're interested in the confusion aspect, which suggests bad faith.

I dunno, talk to a trade mark attorney.
posted by doublehappy at 4:04 PM on January 24, 2011

What brainmouse and doublehappy say.

All you have to do is to look at the undisclosed amount that Apple Computer had to pay Apple Records of the use of name Apple. And this was before things like playing music on computers, iPods or what not. Part of that agreement said that Apple, Computer wouldn't get into the music business so there was another dustup (with undisclosed payout) when iTunes came along.
letingenous
There are stories about big companies suing the shit out of individuals because they share the same name. The seek relief because of "customer confusion" but no one is going to confuse a guy named Fred McDonald from the global burger chain.

On the other side there's Acme this or Acme everywhere and they coexist.

My point is, if you're going to name yourself after an existing company name, even if their business is 180º different than yours, makes sure they aren't a bunch of litigious bastards. You may legally be OK, but you'll be in the poorhouse trying to defend yourself.
posted by birdherder at 5:01 PM on January 24, 2011

I'm not an expert in this area, but I would be concerned about trademark infringement, unfair business practices stuff. Generally, I think, likelihood of confusion is a bad thing in this area.

Again, I don't know. But I wouldn't do it without getting real legal advice.
posted by J. Wilson at 6:35 PM on January 24, 2011

Are you sure you want to use this name? Dare to dream; if your venture actually does succeed, you will have to choose between using a confusing name or confusing people by changing it. If as you expect you don't make money, then you'd at least like to deduct your expenses. The IRS can disallow them if they decide you're running hobby rather than a business. "Yes, Mr. Auditor, I thought it would be funny if my business were hard to find on the web!"
posted by drdanger at 6:41 PM on January 24, 2011

Trademark law basics.

Trademark law in the US operates on an eight-factor test. Previously, this was case law, but it was put into US code with the Anti-Cybersquatting law of 1999 (which does apply to more than domain names).

Essentially, if you are not in any direct competition in the marketplace and there is no chance of consumer confusion -- e.g. AAA Bluxome Flowers in Chicago and AAA Bluxome Flowers in San Francisco, both only serving a local clientele -- you'll most likely be fine. If, on the other hand, the existing user of the name has any claim to famous-name protection, like 10% of their business being online or something, you're in slightly warmer water.

Now, you're suggesting/implying that your publishing company is using the name of a company in another industry -- "floral/retail" for argument. You probably don't have much concern here. One recent case allowed a winery named Trek to sell under that name despite a lawsuit by the bikemaker named Trek (on the other hand, the decision was not actually on the trademark merits).

Before I began selling anything, though, I'd at least want a trademark-experienced lawyer to have a look-see. Lawyers is expensive, and defending lawsuits even more so.
posted by dhartung at 10:51 PM on January 24, 2011

Thanks a lot, everyone.

Thanks for the link to the trademark search, doublehappy. I've searched around and none of the businesses with this name seem to be in it.

dhartung, thanks a lot for all of the links. Reading about the eight-factor test and past cases indicates to me that I'm in the clear legally. I should probably find a lawyer, though.

Based on everyone's answers, it seems like the biggest concern is about whether the business (businesses? I've kind of been working in the assumption that the only one with any feasible chance of confusion is the one in my city) feels like being litigious, and I should talk to them. That'll be a funny discussion. There'll be a language barrier, and I'm trying to think of a way to frame it not as asking them for permission to do this thing that won't make a lot of sense to them, but as offering them something useful (a link on the website to their page on Yelp, maybe? An email address?)

drdanger, your point is well taken, and I'll definitely continue to think about it. The way I phrased the question, it probably reads a little bit like, "Hey, check out this dumb idea I thought of when I was drunk! Isn't it hilarious?" I am taking this seriously, and think it's a good name.
posted by roll truck roll at 12:34 PM on January 25, 2011