Steps to take in protecting your firm’s goodwill

Imagine you are the owner of a small business in New Hampshire that occasionally attracts customers from Massachusetts. You attend a sporting event in New Hampshire where a Massachusetts radio station broadcast can be heard on the loudspeakers. Suddenly you hear an advertisement for the grand opening of a business in Massachusetts with the same name as your business, offering the same services that you offer. Your stomach drops as you realize your customers will be confused by the ad.

Many businesses in New Hampshire do not realize the advantages of protecting their goodwill and reputation by registering their intellectual property. But what are the necessary steps that every business owner should take to protect his or her company’s goodwill?

First, everyone who conducts business in New Hampshire is required to register the business with the secretary of state. When a business files for registration, the state will conduct a search to ensure that the business name is not the same as or likely to be confused with any other business name already registered in the state, whether it be a New Hampshire or foreign business (foreign businesses conducting business in New Hampshire must register). If you registered your company’s name, but conduct business under a different name, you should file with the state a trade name registration form.

Once an entity or trade name is registered in New Hampshire, other companies will be prevented from registering or conducting business under the same or similar name in the same industry. In addition, once a business name is registered, your entity will have a cause of action against foreign companies who attempt to conduct business in New Hampshire. A business using a subsequent similar name in a different industry may be able to register it, as the secretary of state will consider the location and purpose of a business.

Stronger protection

You also should file a trademark application with the secretary of state for any words, names or symbols associated with your business. Although strongly recommended, state trademark registration is not required to establish priority or to sue for infringement as common law trademark rights begin to accrue once an entity starts doing business in the state.

The advantage of this registration is that it creates strong evidence of a valid trademark, meaning that someone opposing your mark would have a difficult time proving that your business name or logo is generic or not distinctive enough to merit trademark protection. Furthermore, trademark registration allows logos associated with your business to be protected from infringement by a company from another state that is conducting business in New Hampshire.

However, if you only register your trademarks in New Hampshire and a business from another state begins using your exact mark in that other state, you would have no remedy at law in New Hampshire unless the infringing entity conducts business in New Hampshire.

Third, if you want to protect your business’ name and logos nationwide, you should federally register the name and logos with the U.S. Patent and Trademark Office. Although this can be somewhat expensive — and is not necessarily guaranteed, since others may have already registered similar names or logos — the investment may prevent costly litigation.

Federal registration is prima facie evidence of the validity of your mark. In addition, it allows you to have superior rights over any subsequent users of the same or similar marks anywhere in the country, making future expansion of your business to another state easier to accomplish and will prevent the above scenario from happening to you.

Arpy Saunders is a member of the law firm of Shaheen & Gordon P.A.