Do’s and don’ts of having and using DBAs
by John Schuster of Caliber Law, S.C. 920.292.0000
People often ask me what a DBA is and how best to use it in relation to their business. By definition, a DBA is the use of a name for marketing purposes that is not the same name as the legal entity of the business.
For instance, Frank’s Towing might be a DBA of World Towing, Inc., and used to advertise in a certain geographic region. They might have acquired the name from someone else, or wanted to use a name that was different than the legally registered name of their business.
The dangerous part about using a DBA is that it could expose you to unlimited personal liability if you do not use it properly with the right disclaimers, which is why I always propose that my clients do the following:
Register your DBA as an actual trademark – DBAs are essentially “tradenames” that in most instances would be considered to be “trademarks,” and as such, the best way to handle these situations is to register your DBA as a trademark. This can be done on either the state or federal level, which protects the mark, and most importantly, gives public notice that your DBA/tradename is actually owned by your business, showing that use of that name does not waive your right to asserting that you have limited liability protection through your legal entity.
Disclaimers – It is essential that any time you use a DBA, such as using the name on a website, that you clearly identify and state the full name of your legal entity at the bottom of your website, so that you have given public notice that the DBA is the property of, is associated with, and falls under the umbrella of your main business entity to avoid any appearance that the DBA is owned by you personally.
If you do not follow the steps above, it is likely that someone suing you for the services or goods that you offered under your “DBA” will argue that the DBA was really just owned by you personally, effectively avoiding the limited liability protection that you had put into place when you created your legal entity.
This is why it is essential that you speak with a qualified business attorney who understands the ins and outs of specific trademark laws and registrations to help you protect your intellectual property and tradenames.
John W. Schuster, JD MBA is the owner and an attorney at Caliber Law, S.C., a law firm located in Oshkosh. He specializes in helping business owners start, protect, buy, sell and grow their businesses.