It is widely known that if you want to conduct business in the State of California using a fictitious business name, you must properly register your fictitious business name. Whether your business is a sole proprietorship, partnership, corporation or other legal entity seeking to use a fictitious trade name, the registration process requires the business owner to file a fictitious business name statement (within 40 days of first using the business name) with the county clerk’s office where the principal place of business is located in California. Within 30 days of the filing, the fictitious business name statement must be published in a newspaper of general circulation in the same county. Registration of the trade name is complete when an affidavit or proof of the publication is filed with the county clerk’s office, as long as such proof is filed within 30 days of completion of the publication process. Fictitious business name statements generally expire 5 years after filing, but can be renewed by the registrant.
The filing of a fictitious business name generally gives the business owner the exclusive right to use that name (and often confusingly similar names) in the county of registration, provided that the owner is the first to file in that county and is actually engaged in business using that name. You also need a fictitious business statement to open a bank account in the fictitious business name or accept for deposit checks in such name. Finally, if you do not have a properly registered fictitious business name, your business will not be able to sue on account of any contract made, or transaction had, in your fictitious business name, even though others can bring legal action against your business.
One of the most common questions I get from startups and companies looking to enter into the California market relates to where the business should file their fictitious business name statement and whether the business is required to file a separate statement in every county where the company intends to do business. Surprisingly, search engine results are not helpful so I decided to write this post to clarify California law on this subject. The bottom line is that you need only to file your fictitious business name statement in the county where your principal place of business is located in California, and if you do not have a place of business in California, the fictitious business name statement must be filed with the Clerk of Sacramento County.
Specifically, Business & Professions Code section 17915 provides:
A fictitious business name statement shall be filed with the clerk of the county in which the registrant has his or her principal place of business in this state or, if the registrant has no place of business in this state, with the Clerk of Sacramento County. This chapter does not preclude a person from filing a fictitious business name statement in a county other than that where the principal place of business is located, as long as the requirements of this section are also met.
As always, there are exceptions to every rule and there may be reasons why a business should register a fictitious business name in more than one county in California, especially for startups trying to grow and protect their business name. In developing a particular approach to dealing with business formation and fictitious business name statements, consult with your general counsel or experienced business attorney.
For more information contact:
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400