You know what you want to name your business, and maybe you’ve already done some work to set up the branding and figure out exactly what the company’s vision is going to be. In other words, that name is very important to you.
But then you find out that another company is already using the same business name. You’re worried that they’re going to sue you, and you don’t want to wind up in a lawsuit just because you chose the same name. Before you launch your company, do you need to choose a new name and rebrand everything, or are two companies actually allowed to have the same name?
Will it create consumer confusion?
The reason that companies are not supposed to use the same names is because it can create consumer confusion. Some companies do this essentially as a means of fraud, trying to trick consumers into buying their products, so it is illegal to do this.
But if there is no consumer confusion, then there can be businesses with the same name. A common example is when businesses are in very different geographical locations, so there isn’t much overlap in the consumer base.
Another example is when two businesses operate in vastly different industries, so it’s clear that someone who is looking for products or services is not going to get confused between the two. If your business helps people with investment strategies and the other business sells athletic apparel, it’s not going to be a problem in most cases.
Whether you’re setting up your business or trying to work your way through litigation, make sure you understand all of your legal options.