I registered my business name with the state last year and figured that was the end of it. Now there's another shop in the next town using almost the same name. I got a letter from their attorney saying I might have to change mine. I don't understand how this is possible if I filed all the paperwork and paid the fee.
Trademarks
I thought the state registration meant nobody else could use it
State registration only stops another company from registering the exact same name in that state. It doesn't create ownership rights that would stop someone from using a similar name in commerce.
What griddle_monkey said. Also, if the other shop registered a trademark, that changes things. Did they mention a registration number in the letter?
They didn't give a number, just said they own the name and I need to stop using it. I didn't even know trademarks were separate from the state filing until now
This is really common. People think the state business license is a trademark because it feels official. It is not. You might have common law rights from using the name first, but that depencs on your area and theirs.
Common law rights only matter where you actually operate. If the other shop is in the next town and has been using the name longer, they may have priority in that region.
Did you check if they have a federal trademark on the USPTO site? That would be the first thing I would do. If they filed before you started using yours, the letter probably has teeth.
Also worth checking whether they actually have a registration or just sent a scary letter. Some attorneys send demand letters before filing anything.
I would not ignore it though. Even if they have no registration, they could still sue under state unfair competition law. Nobody wants that bill.
Do you have a date you can prove you started using your name? Invoices, social posts, anything with a timestamp will matter more than the state registration.
This. I went through something similar two years ago and the state filing was basically irrelevant once an attorney got involved. The only thing that helped was proving I had been using my name locally first.
Good point on the proof of use. Also worth noting that if you do change your name eventually, rebranding costs are often negotiable in a settlement. A friend of mine got the other side to cover part of her new signage.