Company name has 1 word the same as another company in same industry

[truckmount]

What is the name of your state (only U.S. law)? VA

We are about to launch a company where (we just found out) that a nationwide company has 1 word in their company name that would also be included in ours.

Could we possibly be in trouble for doing so?

Here is an example, there is a company called ZeroRez - what if we used the name 'Rez' in ours as well?

 

[LdiJ]

What is the name of your state (only U.S. law)? VA

We are about to launch a company where (we just found out) that a nationwide company has 1 word in their company name that would also be included in ours.

Could we possibly be in trouble for doing so?

Here is an example, there is a company called ZeroRez - what if we used the name 'Rez' in ours as well?

That isn't necessarily the best example because rez is potentially very distinctive depending on the industry.

If you use a word, with different placement, that is relatively normal for the industry or in general usage, then you are unlikely to have a problem.

For example:

Jane's Gluten Free Bakery vs Mary's Gluten Free Bakery has three similar words, but cannot be confused as being the same business. Gluten Free Bakery is purely descriptive, and the first word in the name clearly indicates that they are not the same business.

However, Gluten Free North, vs Gluten Free South could definitely be confused as being the same business, with different locations.

Using your same example ZeroRez, could definitely be confused with ZeroRes. However ZeroRez and Rez Free Zone might be unlikely to be confused at all...again, depending on your industry and the meaning of "Rez" within your industry.

So, you have to look at things from multiple perspectives...is the word common usage and descriptive, is it's placement in the name significantly different, and is it clear that they are not the same company?

You also have to keep in mind that a name change challenge can be extremely expensive to defend in court if you are going up against a company with much deeper pockets than you have. Even if its something that you might eventually win, the company with deeper pockets could litigate you right out of business.
Therefore its wise to choose a name that its unlikely you would have to defend.

 

[quincy]

What is the name of your state (only U.S. law)? VA

We are about to launch a company where (we just found out) that a nationwide company has 1 word in their company name that would also be included in ours.

Could we possibly be in trouble for doing so?

Here is an example, there is a company called ZeroRez - what if we used the name 'Rez' in ours as well?

You could possibly be infringing on the rights of the other company and this could lead to a trademark challenge - but whether your proposed company name infringes on the ZeroRez trademark depends on far more facts than you have disclosed here.

Is the ZeroRez in the same business (marketing the same products or services) as your company?

Does ZeroRez have a registered trademark in the name? If so, in what class or classes has it been registered?

How well known or famous is ZeroRez?

Is the "Rez" used in your example in actuality a common word, or is it a fanciful word like Rez?

There are other considerations, but we can start with those.

As LdiJ noted, an "invented" or fanciful name used for a trademark (like Kodak), or a portmanteau word used for a trademark (like Microsoft), or a famous mark (like McDonald's), will be offered the greatest protection under trademark law. But there are several companies that operate under the same or similar names and are able to peacefully co-exist in the marketplace because no consumer confusion is generated by the dual use of the name (think of Dove ice cream bars and Dove soap - a consumer is unlikely to confuse the two).

A trademark is used to distinguish one company's products and services from those of all others, so it is always best to pick a trademark for your company that is distinctive enough to work to this purpose.