If you've recently been laid off from a corporate job and are thinking about launching an independent consulting business, you might go to a couple of trade shows, where you meet consultants from around the country who are doing more or less the same thing you want to do. As part of your networking efforts, you collect their business cards and marketing brochures.
Back home, you need an image for your new business, but are having trouble coming up with something unique. All of a sudden, a little voice in your brain says: "Why should I reinvent the wheel? These other consultants have already done the work, so why don't I use the same name as consultant No. 1, copy the design of consultant No. 2's business card, and 'borrow' the text of consultant No. 3's marketing brochure?"
Can you do any of these things without breaking any laws or getting sued? Not really.
The Marketing Brochure Text
Let's take the easy one first. Even though consultant No. 3 has not registered a copyright for the marketing brochure with the U.S. Copyright Office (you've checked this out on www.copyright.gov), and there is no copyright notice (such as © 2002 by Cliff Ennico) anywhere in the brochure, the text of consultant No. 3's marketing brochure is copyrighted material and should not be used. A work is under copyright protection the moment it is created and fixed in a tangible form, so if you copy the text verbatim, you are "infringing" (or ripping off) consultant No. 3.
What if you take the text and change just a few words? Still no good. The copyright laws cover "derivative works" that are based on copyrighted material. Sad to say, you will have to come up with your own words when you draft your marketing brochure. Of course, there is no harm in reviewing other folks' brochures; your brochure can say the same types of things-you just can't use the same words to say them.
Company names cannot be copyrighted, but you still can get into trouble here if you are not careful. A company name can be trademarked with the U.S. Patent and Trademark Office, and either you or your lawyer should check out the PTO's Web site at www.uspto.gov to make sure consultant No. 1 hasn't done so. If consultant No. 1's company name has a little "TM" or "SM" next to it, it means he or she is using it as a trademark. Stay away.
Let's say consultant No. 1 has not trademarked its company name. If you are doing business in the same state as consultant No. 1, and he or she has registered its company name with the Secretary of State's office in your state, you are not allowed to do business under exactly the same name. If you are in another state, however, and the exact same name is available from the Secretary of State's office in your state (a list of Secretary of State offices is available at www.iaca.org), there is nothing to prevent you from setting up a company in your state with the exact same name as consultant No. 1's. Just be sure to keep a wide berth from consultant No. 1 the next time you attend that professional meeting or trade show!
Designs & Logos
Here's where things can get really sticky. If a design or logo has been trademarked, you can't use it, period. But what if you just want to copy the "look and feel," or the color scheme, of consultant No. 2's business card? Generally, designs or colors cannot be copyrighted, but if your company image or design is a little too close to someone else's well-recognized design, to the point where customers are likely to confuse your business with consultant No. 2's, you may find yourself being sued for "misappropriation of trade dress."
The Real World
In practice, it is tough to develop an image for your business that is 100 percent unique and distinctive. Someone, somewhere, is likely to be doing something similar. So what do you do? Here's some good news. When someone thinks you are infringing their copyrights, trademarks or trade dress, they rarely sue right off. They first send you a nasty letter notifying you of the infringement and warning you to "cease and desist" using your image.or else. You then take this letter to your lawyer, and if he/she agrees there's a problem (or if the other person is too powerful to mess with), you can avoid a lawsuit by simply changing your image.
The best defense against an infringement suit is to do a thorough search of the copyright and trademark records before you use a logo, design or image for your business. Most lawyers will charge between $500 and $1,500 to do a basic search, and it's money well-spent.
Cliff Ennico is host of the PBS television series MoneyHunt and a leading expert on managing growing companies. His advice for small businesses regularly appears on the "Protecting Your Business" channel on the Small Business Television Network at www.sbtv.com. E-mail him at email@example.com.
Cliff Ennico is a syndicated columnist and author of several books on small business, including Small Business Survival Guide and The eBay Business Answer Book. This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state.