Coleman Jackson, P.C. | Transcript of Legal Thoughts
Published October 17, 2022
Overview:
Legal Thoughts is an audiocast presentation by Coleman Jackson, P.C., a law firm based in Dallas, Texas serving individuals, businesses, and agencies from around the world in taxation, litigation, and immigration legal matters.
This episode of Legal Thoughts is an audiocast where the Attorney, Coleman Jackson is being interviewed by Johana Powell, Tax Legal Assistant of Coleman Jackson, P.C. The topic of discussion is “Starting your first business in Texas: Assumed names use in Texas”.
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TRANSCRIPT:
ATTORNEY: Coleman Jackson
LEGAL THOUGHTS
COLEMAN JACKSON, ATTORNEY & COUNSELOR AT LAW
ATTORNEY: Coleman Jackson
Welcome to Legal Thoughts
My name is Coleman Jackson and I am an attorney at Coleman Jackson, P.C., a taxation, litigation and immigration law firm based in Dallas, Texas.
In addition to myself, we have Alexis Brewer and Johana Powell– Tax Legal Assistants, Leiliane Godeiro – Litigation Legal Assistant.
On today’s “Legal Thoughts” podcast, our Tax Legal Assistant, Alexis Brewer, will be interviewing me on the important topic of: “Starting your first business in Texas: Assumed names use in Texas.”
This is a series of podcasts about how to start your first business in Texas, and this is the second episode.
INTERVIEWER: Johana Powell, Tax Legal Assistant
Hi everyone, my name is Johana Powell and I am a Tax Legal Assistant at the tax, litigation and immigration law firm of Coleman Jackson, Professional Corporation. Our law firm is located at 6060 North Central Expressway, Suite 620, right here in Dallas, Texas.
Good afternoon, Attorney; thank you for agreeing to sit with me as I interview you with respect to this interesting topic: “Assumed names use in Texas.”
Let’s get started!
Question 1:
Attorney Jackson, in our first episode we talked about business structures and some operational concerns about starting a business in Texas. Now, one of the very first steps when starting a business in Texas is choosing an appropriate name for your business.
What does it mean to do business in an assumed name in Texas?
Attorney Answer – Question 1:
Good afternoon, Johana.
You are certainly right, I did mention in our first episode of this series, “Starting your first business in Texas” that new enterprises must consider certain operational concerns and legal concerns when structuring a Texas business. I also stated during that first episode that we would leave any discussion of operating a business in Texas in an assumed name to another podcast. Well, Johana here we are; this is that podcast. We will discuss what it means to operate a business in Texas using an assumed name in this particular podcast today.
So, Johana, in answer to your first question- “what does it mean to do business in Texas in an assumed name”; let me first point out that an assumed name is not the legal name of the business. An assumed name is the name used by the business to do business in the State of Texas. An assumed name is often referred to as a “DBA”, which means “doing business as”. For example, let’s say a certain company’s legal name is “Water All Icy Cold, Limited Liability Company”; and the company do business in Texas as “Mobile Water Cooler Delivered to You”.
Texas Business & Commerce Code, Section 71.101 requires that a company, like our example, who do business under an assumed name in Texas file an assumed name certificate with the Secretary of State, commonly referred to as (“SOS”), if they regularly conduct business or render a professional service in the State of Texas under a name other than their legal name. Section 71.101 requires filing of an assumed name certificate with the Secretary of State of domestic and foreign corporations, limited liability companies, limited partnerships, limited liability partnerships, and other types of business structures doing business in Texas under a name other than their legal name.
INTERVIEWER: Johana Powell, Tax Legal Assistant
Question 2: Attorney, when must the business owners file for an assumed name certificate and what is the effect of the filing?
Attorney Answer – Question 2:
Johana, to avoid harming other businesses and confusion, owners must file for an assumed name in Texas before they start conducting business in this state under the assumed name. The effect of filing for an assumed name certificate is to give notice to the public that the registrant is conducting business under that name. However, the filing of an assumed name does not constitute actual use of the name for determining priority, nor does filing the name with SOS give the registrant a right to use the name when is it contrary to common law, statutory rights of others, violate unfair competition, unfair trade practices, professional ethics rules governing practice of a profession, common law copyright, trademarks or similar laws pursuant to Texas Business & Commerce Code, Section 71.157.
Everyone should respect the rights of others. Violation of others’ rights can land you into a lawsuit, professional ethics sanctions and huge financial losses. Business owners should do their due diligence to determine name availability prior to any use of a name in Texas whether it be a legal name or assumed name. To act otherwise is foolish and could be a violation of civil and criminal laws.
INTERVIEWER: Johana Powell, Tax Legal Assistant
Interviewee’s Comment: Attorney, that is exactly right everyone should respect other people when conducting their business affairs as well as at all other times.
QUESTION 3:
My third question is this one: I am just curious on this point; then, if I file my assumed name with SOS, does it mean that no one is allowed to use it?
Attorney Answer – Question 3
Johana that is a very complex question because generally, every business must protect its own intellectual property and good will.
When you file a certificate for an assumed name it only prevents the Secretary of State from filing a subsequent certificate of formation for an entity with a name that the secretary of state determines is not distinguishable in the records. The filing with the Secretary of State is a notice filing, which means that the Secretary of State does not have any authority under Texas law to review the assumed name certificate to determine if the filing conflicts with another name in SOS’ file.
Johana, any dispute or violation involving an assumed name in Texas is probably left to litigation between the private parties sounding in trademark infringement, copyright infringement, deceptive trade practices, tortious interference with contractual relations or some cause of action like these between the private parties in State District Court.
INTERVIEWER: Johana Powell, Tax Legal Assistant
QUESTION 3:
Attorney, what are the steps to file a successful certificate of an assumed name?
Attorney Answer – Question 4:
First, you should determine whether the name you want to file for is available. The Texas Administrative Code, Title 1, Part 4, Chapter 79, Subchapter C sets out a series of rules to determine whether names are distinguishable, the same, or available with consent.
Business Organization Code, Section 5.053, states in part that “the name of a filing entity or a registered series of a Texas LLC or the name under which a foreign filing entity registers to transact business in this state must be distinguishable in the records of the Secretary of State from any existing filing entity, name reservations, or name registrations filed with them”.
Johan, to file for an assumed name certificate with SOS, your legal name must already be registered with the Secretary of State of Texas.
Then and only then, can you file SOS Form 503, a notarized assumed name certificate with Secretary of State.
INTERVIEWER: Johana Powell, Tax Legal Assistant. Wrap-Up
Attorney, thank you for siting with me today in this series of how to prepare on the journey of owning your first business in Texas. Today’s discussion in our second episode of this series regarding doing business in Texas under an assumed name was very informative.
TAKEAWAY: It seems like there are three take aways here:
- You first file business structuring documents with the SOS for your legal name in Texas; and
- You may if you choose to, do business in an assumed name if you first file an assumed name certificate with SOS; and
- You must perform your due diligence with respect to name availability prior doing business in Texas under an assumed name to respect the rights of other business owners avoid legal issues and potential devastating and costly lawsuits.
This concludes our second episode in our Legal Thoughts podcast’s series called “Starting your first business in Texas”. This second episode was about ASSUMED NAMES USE IN TEXAS. We intend to do future podcast dealing with “starting your first business in Texas”; so, this series shall continue!
Our listeners who want to hear more podcast like this one should subscribe to our Legal Thoughts Podcast on Apple Podcast, Google Podcast, Spotify or where ever you listen to your podcast. Everybody takes care! And come back in about two weeks, for more taxation, contracts, litigation and immigration Legal Thoughts from Coleman Jackson, P.C., located right here in Dallas, Texas at 6060 North Central Expressway, Suite 620, Dallas, Texas 75206.
English callers: 214-599-0431 | Spanish callers: 214-599-0432 |Portuguese callers: 214-272-3100
Attorney Closing Remarks
This is the end of Legal Thoughts for now!
Thank you for giving us the opportunity to inform you about: “ASSUMED NAMES USE IN TEXAS.” Remember this is the second episode of series of podcast that we have entitled, “Starting Your First Business in Texas”. Future podcast in this series will likely be published over the next several months.
If you want to see or hear more taxation, contracts litigation and immigration LEGAL THOUGHTS from Coleman Jackson, Professional Corporation. Subscribe to our Legal Thoughts Podcast on Apple Podcast, Google Podcast, Spotify or wherever you listen to your podcast.
Stay tuned! We are here in Dallas, Texas and want to inform, educate and encourage our communities on topics dealing with taxation, litigation and immigration. Until next time, take care.
