Pennsylvania’s Fictitious Names Act – What you need to know

By: Elikem Tsikata

Nicknames are often considered terms of endearment. They can signal appreciation or fondness to the person or group they describe. Their origins can manifest organically, be rooted in stories, or just be entertaining and random. For a business owner, a nickname is most likely a good thing. Maybe it means the business, if nothing else, has gained enough attention to have an alternate moniker. Maybe it’s a name that is more identifiable for customers. And maybe the nature of your business simply calls for multiple names. But in Pennsylvania, this also means there are registration processes that need to be addressed to avoid unnecessary penalties.

Fictitious Names Act

Pennsylvania’s Fictitious Names Act (FNA) requires that a business operating in the state under a fictitious name register the name with the Department of State. The act defines a fictitious name as “any assumed or fictitious name, style or designation other than the proper name of the entity using such name.” A proper name of an entity is the name set forth in its organizational/registration documents filed with the Department of State.

The goal of the FNA is transparency. The public is entitled to know who it is doing business with. In furtherance of this goal, the FNA needs to identify business entities by any and all names used other than the business’s proper one. It doesn’t matter if you are a sole proprietorship with a ‘Doing Business As’ (DBA) name, or a long-tenured corporation; All Pennsylvania business entities have the legal obligation to complete the proper registration under the FNA if they are using a name different than the one on file with the Department of State.

A Pennsylvania business owner might think “My business has alternate names, what’s the big deal?” While the FNA seems like housekeeping on its face, failure to comply with it may trigger the state’s Consumer Protection Law (CPL). Pennsylvania courts have held that a business that fails to properly register its name will be subject to a CPL violation. This is significant because CPL violations can cause a business to lose thousands of dollars in civil penalties.

Proper Registration

The good news is the registration process for a fictitious name is relatively straightforward. A business must complete a registration document provided by the Department of State; Click here. The necessary information includes the business’s fictitious name, a brief statement of the character or nature of the business, the business address, and a list of additional parties involved. The proper filing also includes payment of a $70.00 registration fee.

The Registration Form can be completed online through the PA.gov website, or hand-written and mailed. The final page of the form lays out other useful instructions regarding proper completion of the document. This page also references relevant Pennsylvania regulations connected to fictitious names and their relation to registration requirements.

After the registration is complete, the business must stay up to date. If the name changes, registration of the new name is necessary. Additionally, the business owner must read the title requirements carefully. Certain words within a business title must meet qualifications for use. A PA lawn mowing company cannot go by “Harrisburg Mower’s University” unless they meet the requirements of the University definition.

Potential Conflicts Before and After Registration

While proper registration of a business’s fictitious name will help to avoid state penalties, it is not all-encompassing in its legal protection. A business owner needs to consider the following even after they’ve completed their fictitious name registration:

Breach of Contract: A non-registered business will be unable to sue another party for breach of contract under the business name. Consider instances where a business is hired and the labor has been completed. If the hirer decides they don’t want to pay for work, the business who has not registered properly won’t have the ability to bring forth the breach of contract action. The court would likely say that the contract was unenforceable.

Liability: A business owner needs to recognize that registration of a fictitious name does not provide liability protection. The liability standards of the specific entity will still apply, and one will not be able to escape liability through the FNA. Additionally, the use of a fictitious name does not create a separate legal entity. As mentioned above, its role is simply descriptive of a person or association doing business under another or additional name.

Competition Protection and Trademarks: Unfortunately, the FNA does not give businesses exclusive rights to their registered name. I’ll say it again for emphasis. Registration of a fictitious name does not create any exclusive right to use the fictitious name. There are no ownership rights attached to a fictitious name. Two Pennsylvania businesses can register the exact same fictitious name and be permissible on its face. Naturally, this seems illogical and unfair. Luckily, the business owner has an alternative avenue of action through trademark law. Through state or federal law, a business owner can file trademark infringement in cases where their fictitious name is being used by others. Factors to be considered will include which party properly registered the name first, history of both businesses, geographic location, consumer base, etc. Because there are state and federal trademark laws, the business owner will have to determine which avenue is proper based on their particular issue. One may find it beneficial to register a trademark for the fictitious name. The general guidelines for trademark action can be seen below:

Federal: How to Register a Trademark for a Company Name

State: Registration of a Trademark

Conclusion

Overall, Pennsylvania’s FNA has a low bar for compliance. Proper completion of fictitious name registration requirements will help the business owner to avoid unnecessary fees and violations leaving the entity time to grow its reputation instead of spending its time in legal battles.

Sources

Consumer Protection Law (CPL), 73 P.S. § 201-1 et seq.

Fictitious Names Act, 54 Pa. C.S.A. § 301 et seq

Pa. Department of State: Fictitious Names Explanation

What’s in a (Fictitious) Name?


Elikem Tsikata, at the time of this post, is a 2L at Penn State’s Dickinson Law. He is a Ghanaian-American from McLean, Virginia, and a graduate of Miami University (OH). Elikem is pursuing a certificate in Entrepreneurship Law with a Transactional concentration. He is interested in corporate transactional law and international development, specifically in African countries. Elikem is currently serving as the Vice President of the Student Bar Association.

Author: Prof Prince

Professor Samantha Prince is an Associate Professor of Lawyering Skills and Entrepreneurship at Penn State Dickinson Law. She has a Master of Laws in Taxation from Georgetown University Law Center, and was a partner in a regional law firm where she handled transactional matters that ranged from an initial public offering to regular representation of a publicly-traded company. Most of her clients were small to medium sized businesses and entrepreneurs, including start-ups. An expert in entrepreneurship law, she established the Penn State Dickinson Law entrepreneurship program, is an advisor for the Entrepreneurship Law Certificate that is available to students, and is the founder and moderator of the Inside Entrepreneurship Law blog.