What Would You Do?

magnum

I started my biz 11 yrs ago (as sole prop., first mistake) built a good honest rep. which is not easy in the remodeling biz since we are all crooks and theifs. About 2yrs ago I got a call from HomeDepot to say my check had bounce, that's when I found that someone else had started a biz by the same name. How the state let him use my company name that I had for 9 yrs. I'll never know. Since then I have recieved calls from his customers with complaints, a boat he bought with a rubber check, IRS saying there is a lien on his biz and so on. My lawyer tells me I'm screwed because he Inced the name and I'm still sole prop. I have been waiting for him to go out of buisness but like a bad rash he keeps coming back. I'm not in the position to buy his company nor do I want to buy his problems. I want to have my new van lettered but not sure if I should change my name or keep it? any advise?

DecksEtc

That sucks! If it were me, I would change my business name but maybe change it to something similar so your former customer's still recognize it, etc. Then, I would call all my most important/repeat customers, etc. and get the word out that you're still around and the reasons you changed your name. You may want to be careful about blaming it on the other guy as it could look like you're trying to get out of something, etc. but if you're a reputable guy then people are likely to understand. Another way to spin the name change is to say you wanted to update your branding, get a new logo, etc., etc. Making it a positive reason for the change might be a better way to spin it.

IMHO, anyway.

cdac

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Mike Finley

I don't understand why your lawyer is telling you that because his business entity is incorporated and yours is a sole proprietorship has anything to do with it.

Last year when I was forming my company I originally wanted to name it Rocky Mountain Home Improvements. There was another company that had been using the name for 3 years but had gone out of business, so I tracked them down and talked to the registered agent (this is a person designated by the corporation to represent the corporation - it happened to be a lawyer who had no financial part of the company) we had a long talk and one thing he warned me was that in their second year of business some loser who operated out of his truck started using their name illegally, the guy was such a loser that he was continually being sued by his customers and suppliers, which of course would end up with the legitimate company being served all the time, this lawyer said he billed them at least 3-4 thousand a year just doing paperwork to prove they were not the same person, that the guy was using their name and that the person suing was suing the wrong people. The company spent thousands of dollars notifying the loser to stop using their name, but since he was just a loser and a beat up truck there was no way to damage him financially as is the usual way to stop somebody from infringing on your name. They too hoped he would eventually drink himself to death or get shot or move away. He out lasted the partners and they went out of business first. This is what he warned me about, that he would work with me to purchase the name from the original partners if I wanted, but warned me that I would be stepping into a mess because I would be dealing with the loser now and his damage to the company name. I passed and did a different name.

If you have been using the name for 11 years you have a great case to show legitimate ownership of it over the infringer, but the moral of the story is, even if you are in the right, can prove it, can get a cease and desist order or a judgement, unless the others are a legitimate ongoing concern, getting any results may or may not happen. But I don't see the business entity having anything to do with it. If you registered the name 11 years ago you should have no problem proving ownership. Trademarking is always advised by a lawyer to help you incase what you are going through ever happens, it helps you prove ownership in court. I would get another lawyer, one that knows his way around this type of case. It is going to cost you some money but unfortunately you won the lottery so to speak and are a victim of these circumstances.

magnum

He is a framing sub from what I gather and I'm a homeimprovement co. with MHIC license which he is not required to have. His problems find me through information. They look up or call info and my co. comes up with my #. He operate with a cell # so when they look for him they find me not knowing they have the wrong co. FYI got a call from GMAC this morning he needs to pay his auto loan.

lpsonbuilders

I would file for an LLC (Limited Liability Corp.), As a sole proprietor everything you own is at risk to some sue happy suck wad.
Good Luck!!

cdac

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cdac

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magnum

I think he is already in a develpment framing for builders and homeowners ask him to do work for them and then when he screws them, they turn to the yellow pages and find me because he wont return the call. I had a couple of knuckel busters who owe me a favor offer to persaude him to change his name but though better of it. I dont need that aggravation. Definetly changing to LLC already have the paperwork.

cdac

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DecksEtc

Not that this is exactly on your topic, but if people paid him "under the table" and then got screwed then it's their fault. If someone books a job with someone without a contract and without more information than the cmopany name then it's their own fault. As for HD, it doesn't surprise me that they f'd up, took a bad cheque with only the company name. It's unlike HD to take a cheque without more info but not surprising that they didn't get more info from the guy. Like Chris said, I don't think you have to worry to much about getting stuck with his debts, it's just unfortunate you have to deal with it.

Good luck to you...

PipeGuy

I use to work for a guy that told me he once called a late paying customer and told him that he had just spent his last $7.00 on a pick-ax handle and was on the way over to chat about a payment plan. Supposedly, the check was ready when he got there. Wouldn't you just love to....

cdac

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Teetorbilt

On the name, you are screwed. A sole proprietorship may only be registered with the county as it is where I am. Anyone else in adjoining counties could use the same name as long as I'm not registered in that county. Corporations are registered with the state and feds, a whole different ballgame.
You might as well accept that you are not going to get out of this unscathed and move into damage control. A name change would be advisable, bad news travels 10 times faster and farther than good news. A mailing to all past customers with a brief explanation of the confusion and giving them your new name, old customers can CYA should the subject arise in conversation. Inc. the new name and sue anyone that tries to mimic it. All this is going to cost but you are fighting for your rep. and livelyhood.
Some large companies change names, the key is to how it is handled. Tell everyone in as many mediums as you can afford. AT&T Wireless just sold to Cingular and will soon cease to exsist. Bank of America just bought Fleet and their name will go by the wayside.
Be proactive!

JustaFramer

If the people that actually now your name (not your company name) then your true reputation will never be marred by this hack crook. Around these parts hack wads crooks change there business names like they change thier shorts. Which is about every couple of years. But wonce we know hows running it. The truth prevails.