Small businesses suffer when they do not proactively handle their legal matters. A common misconception is that businesses only need to worry about the “legal stuff” or hire an attorney after they get in legal trouble. While that may be the case for non-business matters, this is a bad idea when you are a small business owner. The best time to hire (or at least consult with) an attorney is prior to launching, or in the very early stages of starting, a business. To help you become more proactive instead of reactive, here are four quick and dirty tips to keep you and your business out of the legal hot seat:
Choose a distinctive and non-infringing name
It is best to choose a business/product/service name that is highly unique and distinctive from your competitors. The less your chosen name conveys about the nature of your products and services, the better. Names consisting of invented words (such as KLEENEX for tissues) or real words applied to unrelated services (such as APPLE for computers) are the most distinctive and enjoy the highest brand protection in the United States marketplace on a nationwide level. You can always use a catchy descriptive tagline to identify the nature of your products or services.
To ensure that your business/product/service name does not infringe on prior third party’s rights, conduct in-depth searches of the U.S. Patent and Trademark Office’s (USPTO) database, the Internet, business records, and domain name databases for your proposed name, including similar variations, for identical, similar, and closely related products and services to confirm whether it is available for use and registration in the United States. The point of a thorough search is to minimize the risk of receiving a cease and desist letter or, even worse, getting sued. A lawsuit will cost you thousands of dollars more than hiring an attorney to conduct a comprehensive trademark search and provide an opinion on availability.
Protect your intellectual property and respect other’s intellectual property
Intellectual property encompasses four categories: trademarks, copyrights, patents, and trade secrets. Just like houses can be valuable real estate to your personal wealth, intellectual property has significant value to your business wealth. Trademarks protect words, phrases, symbols, or designs (including a combination of these elements) that distinguish or identify your products or services (e.g., business name, slogan, logo, product/service name, and other business assets). Copyright protects the substance and form of original tangible expressions (e.g., writing, music, artwork, etc.). Patents protect inventions (e.g., products or processes). Trade secrets protect business information that has value in its secrecy (e.g., the Coca-Cola formula). You should take an assessment of your business’s intellectual property and then take steps to protect it before another business or competitor beats you to it.
While there are limited exceptions, as a general rule, you should always seek permission from the owner of any intellectual property before using it in connection with your business.
Check out the U.S. Patent and Trademark Office website (www.uspto.gov) for more information about trademarks and patents, and the U.S. Copyright Office (www.copyright.gov) for more information about copyrights.
Document everything with written business contracts
If there is nothing in writing, there is no proof. It is important to memorialize in writing the exact terms of your agreement to eliminate any uncertainty or misunderstanding, protect your rights and interests, and minimize legal disputes and lawsuits in the future. If a dispute later arises, you can always refer back to written contracts as evidence of what the parties agreed to. It essentially functions like “liability insurance” for your business.
Get professional help
To save on expenses, small business owners often take a DIY approach or hire inexperienced professionals to handle important legal matters. At a minimum, you should have your ABCs: a trusted go-to attorney, bookkeeper, and CPA working closely with your business. When you outsource and delegate these very important matters, you minimize your legal risks and liabilities, and also allow more time to focus on your business.
Whether it is a dispute involving a former client, business partner, or contractor with whom you did not have a written contract, or a competitor claiming that you are infringing on their intellectual property rights, litigation is a very costly, time consuming, and emotionally draining experience. If you are proactive instead of reactive when it comes to your legal affairs, your business will be much better off in the long run.
About the Author
Radiance W. Harris, Esq. is the founder and managing attorney of Radiance IP Law. She helps ambitious women business owners protect their brands with trademarks. She has nearly a decade of extensive trademark law experience, and has represented small and large companies across diverse industries. She has also been recognized as a thought leader in the intellectual property law field and the legal community as a whole. Previously, Radiance worked at a major global law firm representing Fortune 200 companies. She received her J.D. from the University of Maryland School of Law and her B.A. from Swarthmore College. You can find her on Facebook at www.facebook.com/radianceiplaw and on Instagram and Twitter at @radianceharris. Check out her website at www.radianceiplaw.com.
Legal Disclaimer: This content is a resource for educational and informational purposes, does not constitute legal advice, and should not take the place of hiring an experienced attorney. This content also does not create an attorney-client relationship between you and Radiance Harris or Radiance IP Law.