Susan Scafidi was quoted in a Quartz article about how to avoid lawsuits while naming your business.
The smartest choice is to create a name for your company separate from your own, says Susan Scafidi, founder of the Fashion Law Institute at Fordham University. “It avoids so many potential problems down the line that it just strikes me as a no-brainer,” she explains. “I really wish designers would exercise just a little bit of the creativity they put into their clothing and so forth into choosing the names for their labels.”
Scafidi is very familiar with the problems caused by going the eponymous route. In the fashion industry, it’s extremely common for a designer to use their own name for their brand, and not by coincidence, there’s perhaps no better arena to see the problems that decision can cause.
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But still another issue with using your own name can arise if you want outside investors. “Once your name is a corporate asset, then investors are going to want a piece of that corporate asset—or full ownership of that corporate asset—which is great as long as you and your investors are getting along,” Scafidi says. “But typically there will be some point at which you, the designer, and your investors part company, and that leaves you walking nameless into the night.”
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Still, Scafidi says the practice is understandable, especially in fashion. It’s a tradition going back to the man known as the first couturier, Charles Frederick Worth, whose House of Worth dominated Parisian fashion in the late 19th century. It also connects brands to their founders in the minds of shoppers.
But she says that the potential costs and hassles just aren’t worthwhile. “Prophylactic legal thinking is always better than trying to pick up the pieces after there’s a problem,” she says. “Unless you’re prepared to have a litigation fund set aside, it’s just bad business to have your name on the label.”