Congratulations, you’ve registered your business with the Department of State and are ready to begin operations! If you’re not planning to use the full name of your company, a common mistake of a new business is the failure to register a fictitious name or what is sometimes referred to as a DBA or d/b/a (“doing business as”). A fictitious name is a name under which you are doing business, but is different than your actual or legal name. The public, consumers, and other parties contracting with your business need to be able to readily identify the true name of your business and the individuals operating it. So if you are doing business under a name that is different than your legal name, you must register your fictitious name.
In Pennsylvania, the Bureau of Corporations and Charitable Organizations will be a good place to start. Contact the experienced and local business lawyers of MBM Law to assist with starting your business.
What Is a Fictitious Business Name?
A fictitious name is an assumed name, other than the legal name, that an enterprise uses to conduct legal business in Pennsylvania. In a sole proprietorship, the surname of the sole proprietor standing alone, or coupled with words that describe the business, is not a fictitious business name. Sally Smith operating a vegetable stand using just her legal name, Sally Smith Vegetables, is a sole proprietorship and does not require registration.
However, Sally Smith, operating a vegetable stand as a sole proprietor, but calling the business Cukes & Zuchs, should be registered with the Pennsylvania Bureau of Corporations and Charitable Organizations as a fictitious name. In a general partnership, if the last names of all general partners are used such as Smith, Jones, and Brown Landscaping, it is not a fictitious business name. The inclusion of words that suggest additional owners, such as “Company”, “& Company”, “& Sons”, “& Associates”, makes the name an assumed or fictitious name.
Registering a fictitious name should not be confused with incorporation or creating a new entity as the two are separate and distinct legal principles. Registering a fictitious name does not create a new business in the eyes of Pennsylvania. Rather, the fictitious name allows others to be aware of with whom they are doing business. Therefore, any time you have a name that does not readily identify the owner of the business, it should be registered as a fictitious name.
Why Should I Register My Fictitious Name?
There are many reasons why the law requires that the fictitious name must be registered. The most important reason for most business owners to register is the penalty for failing to file a fictitious name registration. Further, an entity operating under an unregistered fictitious name may not use the courts of Pennsylvania to enforce a contract entered into while using the unregistered fictitious name. Suppose the company “Flowers, Inc.” is operating under the fictitious name “Flowering Giant” but has not registered the fictitious name with the Department of State. Flowering Giants then enters into a contract with “ABC Corporation” and ABC Corporation has failed to pay for the goods and services pursuant to the contract. Flowering Giants cannot file suit against ABC Corporation to recover damages until such time as the name is registered.
The failure to register the fictitious name does not void the contract but merely prevents such enforcement in the court until the name is registered. The court has the option of imposing a $500 penalty in these instances where the entity seeks to enforce the contract and subsequently registers the fictitious name in an untimely manner. This ability to use the courts to settle a dispute is not a one-way street. The registration of a fictitious name allows a patron, customer, vendor, or even another business to know who is legally responsible in the event that there is a claim for goods, services, or payment.
The legal theory behind registering a fictitious name is that the public has a right to know with whom it is doing business. Thus the obligation to register a fictitious name in Pennsylvania applies not only to individual persons but also to corporations. Businesses, like natural people, can conduct their operations under their proper names; but for a corporation, its proper name is the one set out in its articles of incorporation or its certificate of organization for a limited liability company. ABC Corporation may trade under its own name without any registration beyond its articles of incorporation, but it may not trade under any other name, such as “Alphabet Co.” unless it is registered.
Do I Get Exclusive Rights to My Fictitious Name if I Register?
Registration of a fictitious name does not provide the business entity with exclusive use of the name. There are no ownership rights to a fictitious name and the name is not protected against use by anyone else. The same fictitious name can be used repetitively by different business entities.
It is important not to confuse a fictitious name registration with a trademark or copyright. Registration under the Pennsylvania Fictitious Names Act creates no legal right to the name. If Mr. Smith wants to trade using the name Flowering Giants on Main Street, it does not preclude Mr. Brown from using the same name to conduct business on Elm Street.
However, there are ways for Mr. Smith to protect the name Flowering Giants. The name of his business may be protected with a trademark. Additionally, and, in many instances, even without a formal trademark registration, Mr. Smith may be able to bring a lawsuit to stop any unfair business practice, such as stealing the name Flowering Giants. Indeed, quick action is often essential to preserving the right of a business to use a particular name.
How to Register Your Fictitious Name
The use of fictitious names is governed by the Fictitious Names Act of 1982, (54 Pa.C.S. Section 301 et seq.), which repealed prior laws on the subject. Accordingly, fictitious names no longer need to be filed at the county seat. Any entity or entities (including individuals, corporations, partnerships, or other groups) which conduct(s) any business in Pennsylvania under an assumed or fictitious name shall register such name by filing an application for registration of the fictitious name.
To register a fictitious business name that has been determined to be available, you must file an Application for Registration of Fictitious Name (form DSCB: 54-311) with the Pennsylvania Department of State, Corporation Bureau.
State Business Name Registration
If you will be operating your sole proprietorship in Pennsylvania under a name that is different from your own name, then you will need to file an Application for Registration of Fictitious Name with the Pennsylvania Department of State. The filing fee is $70. You can either register your fictitious name online using the PA Business One-Stop Shop interface or download the appropriate form and mail it into the Department of State.
- Pennsylvania also requires that you publish an advertisement in two newspapers in the county where your business is located, stating that you have filed or intend to file a fictitious business name registration application.
- The advertisement must contain the following information:
- The fictitious name;
- The address, including street and number, if any, of the principal office or place of business of the business to be carried on under or through the fictitious name; a P.O. Box alone is not acceptable.
- The name and address, including street and number, if any, of the person filing the registration; and
- A statement that an application for registration of a fictitious name is to be or was filed “under 54 Pa.C.S. (relating to names).”
One of the newspapers must be a legal periodical or newspaper. If there is no legal periodical or newspaper published in the county, then two newspapers of general circulation are sufficient. If there is only one newspaper of general circulation in a county, advertisement in that newspaper is sufficient. The Department of State has a list of legal newspapers. Proof of satisfaction of the advertising requirement should not be submitted to the Department of State, but you should retain proof in your business records.
Although you are not required to do so, you should consider registering your business name as a federal and/or state trademark. As a general rule, if someone in a similar field to yours is already using a particular business or organization name, you should not use it, nor should you use a name that would be confusingly similar. A trademark registers a business name or slogan with the Department of State, allowing the holder to file a lawsuit should another entity attempt to use the name.
How Can I Get the Exclusive Rights to a Fictitious Name?
Incorporating a business by filing Articles of Incorporation with the Pennsylvania Department of State provides a business with exclusive use of a corporate name. A corporate name may not be the same as or confusingly similar to the name of any other corporation, limited partnership, limited liability company, or limited liability partnership.
While registering your business name under the Fictitious Name Act may seem to be just more red tape, compliance with the law helps establish you as a legitimate business entity.
Registration can also establish the date your business first began using the name in the event of a dispute over the right to the name.
FAQs About Fictitious Name Registration
Q: If I register a fictitious name, am I creating a new entity?
A. No. The fictitious name registration does not create a new entity or business.
Q. Does registering a fictitious name affect my business or change my business filings?
A. No. The business can still operate under the name you filed with the Department of State when you created the entity. You are only giving the business another name that it can operate under if you choose to do so.
Q. Is registering a fictitious name just giving my business a different name to use?
A. That’s correct. Think of it like a Halloween mask. The business entity is the person, and the fictitious name is the mask. The person does not change when they put on the mask, but it can be hard to tell who it is behind the mask. The filing of the fictitious name assures that everyone who comes into contact with the business knows who is behind the mask when it’s on, or at least very easy to find out by checking the Department of State website.
Q. Can I have more than one fictitious name?
A. Yes. The business can have multiple fictitious names. If you open a restaurant called “Jimmy’s” and wish to open a second location on the eastern part of the city and want to call it “Eastern Jimmy’s” or “Jimmy’s 2,” that would be a necessary reason to file for a second fictitious name. However, if you are opening multiple businesses that operate in different areas (restaurant vs. retail), you may want to use two separate business entities for those separate businesses and should consult with an attorney.
Q. How do I use my fictitious name?
A. Simply advertising your business with your fictitious name is “using” your fictitious name. The main area in which a fictitious name becomes essential to use correctly is in a contract. When you enter into a contract, you should use your full business name, such as “John Smith Construction, Inc.” However, you should include all of your fictitious names to identify all of the names that the business is known and registered as. This is what’s commonly called a DBA or d/b/a and it stands for “doing business as.” In practice, you would enter the name of the business as a party to the contract as “John Smith Construction, Inc. d/b/a Smith Construction.” This gives the other party to the contract notice of the true entity name that is behind the fictitious name.
Q. How do I change my registered business name to my fictitious name?
A. That would involve amending your Articles of Incorporation, Certificate of Organization, or other documents that you filed with the Department of State to create the entity.
Need Help With Your Fictitious Name in Pennsylvania?
There are certain requirements before you can establish your fictitious name in Pennsylvania. The experienced Pittsburgh business attorneys of MBM Law can help you every step of the way.
Please feel free to contact the attorneys at Maiello, Brungo & Maiello, LLP for additional information.