By: Lauren Tagarao

Associate Attorney

The terms trademark and trade name may sound similar, but business owners should know that they serve different purposes and have different legal implications.

What’s the difference?

A trade name (commonly referred to as “doing business as” or “DBA”) is a name a company uses to operate its business and identify itself to the public in place of its formal legal entity name (think Uber vs. Uber Technologies, Inc.) Trade names are registerable in state offices and can protect against the use of the same company name by others in your state. In general, it is not difficult to choose and secure a trade name as long as that particular name is not already a registered business name in your state.

On the other hand, a trademark is a word, symbol, or combination of words and symbols, used to identify specific products or services offered by a business and to distinguish those products or services from those of competitors. Trademarks exist to protect consumers and prevent confusion in the marketplace. While often more difficult and expensive to secure than a trade name, a trademark registered with the United States Patent and Trademark Office can be one of the most valuable assets that a business has, since it’s connected to the recognition and goodwill of its brand.

Why does it matter?

The functional difference comes down to identifying “who” vs. “what.” Companies use trademarks to differentiate their goods or services (the “what”) from those of competitors, so consumers can quickly recognize the brand and develop brand loyalty. A trade name is more administrative in nature - it’s the name on your company’s bank account, invoices, or website (the “who,”) and it protects the name of the company apart from what it does.

However, a trade name can also be registered as a trademark if it’s used in interstate commerce to identify your business as a source of certain goods or services. A federally-registered trademark offers a wider scope of protection than a state-registered trade name, and while registration of a trademark doesn’t guarantee against conflicts, it provides a presumption of valid ownership and protects against the registration of confusingly similar marks by the trademark office.

Bottom Line

While there may be overlapping grey areas, the use, function, and scope of protection of trademarks and trade names are quite different. Most importantly, having a registered trade name in your state does not ensure that the same is available for your use as a trademark, nor does it protect against other users adopting the same or a similar mark – either of which may result in expensive rebranding or even legal action. Business owners can avoid future roadblocks by having an early, comprehensive strategy that identifies potential conflicts and ensures the protection of valuable IP assets.