The Law Office of Hutchinson, Thompson, Henderson & Mott

Has your Business Name Expired?

October 18th, 2013

By: Nathan Green

Business names expire every five years if not renewed.  Has yours?

Many corporations are incorporated as numbered companies, or with a name they do not intend to use generally, but then register a business name which they show to the public.  What they might not be aware of is that business names expire automatically after five years if not renewed.

So why ensure that business names are renewed as needed and kept up to date?  Firstly, to prevent anyone else from using that name.  An intellectual property claim can be a tricky thing to establish and without going into great detail, registering a business name is the simplest way to hopefully discourage someone else from using the same name.  It does not however give the same protection of a trademarked name.   The problem is that once the registration period expires, anyone could register the name that you have been using, including a competitor.

An expired business name is also an invitation for debtors of the company to object to their obligations.  I often have clients come to see me once they have been sued in a dispute over the quality, quantity, or cost of the work a corporation performed.  One thing I have noticed with surprising frequency is that they regularly perform a name search on the named plaintiff and find that there was nothing registered.   Practically this issue is rarely going to determine the outcome of a court case, but emotionally it makes litigation more likely and contributes to the other side feeling that they are “right”, and it could mean a motion which even if won could be expensive, and there could be negative cost consequences in court.  All this means that defendants could be less likely to settle and more likely to drag out litigation (a horribly expensive action as anyone who has gone through a lawsuit well knows).

In the end however this is one of those items of corporate hygiene which provides a great return on investment and stops problems from ever occurring.

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