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LESSON PLAN: PAGE 1

TOPIC:  The Name Game

OBJECTIVES:

1) Knowledge:

• understand an important step to be considered before launching an entrepreneurial venture: name

2) Skills:

• develop the ability to ask and answer questions.

RESOURCE MATERIALS:

• Article: The Name Game
• Partially completed multiple choice test.

1. Divide the class into groups of 2-3 students.
2. Have each group decide on 5 possible names for an electrical company. i.e. Sparky's Electric
3. List the names on a transparency or on the blackboard
4. Apply the 3M rule to each name in an attempt to choose the best name:

   M memorable

   M ellow

   M ass appeal

5. Divide the class into groups of 2-3 students.
6. Rave groups brainstorm for names for each of the following ventures, while applying the 3M rule:

   a) home alarms company

   b) fried chicken outlet

   c) home builder

7. Distribute the article on the Name Game to each group
8. Explain the task:.

   a) read article

   b) answer test questions

   c) develop questions, and through research, answers related to sections of article

   d) present brief reports to the class

   e) submit four multiple choice questions based on research

9. Conduct a test with 7 set questions plus 3 more from pool of student questions: total of 10.

Approximately two to three 55 minute periods.

 

LESSON PLAN: PAGE 2

• Completion of task mark for organizers.
• Teacher monitors students working in groups.
• Evaluate presentations using criteria acceptable to both the teacher and the student.

• Guest speakers to talk about the legalities of name protection.

STUDENT DOCUMENTS: PAGE 1

Two friends of mine are aspiring businessmen. One runs Argood Alarms. How did he pick the name? He wanted a name that people would see first when looking through the telephone book. The other friend is getting into building houses. His business is incorporated with a number but, as of yet, has no name. So what's in a name? Lets look at it backwards: a well-known moniker is an asset to be protected and the unsuspecting can see a competitor come in and snatch their name away.

Neil McKnight bought into a franchise called Flings Chicken and Taters. There were 23 outlets across Canada. About six months later, things started getting shaky. Outlets were getting notices of unpaid bills they had forwarded to head office to pay. A year into the business, the franchise fell apart.

Fifteen franchisees from Ontario to Nova Scotia got together to salvage their businesses. McKnight ended up paying a large sum of money on bills he had already paid. Others ran out of money and had to give up the fight. Finally, four of the original franchisees took over the business and the other remaining outlets buy from this group.

The first things they did were analyze the breading and get a patent on it, and form a corporation with the name Flings: the original owners had never bothered to secure the name for themselves.

The new corporation registered and trademarked the name. It was advertised, as required by law, in the Canadian Trade-marks Journal, which is followed by a 60-day challenge period.

STUDENT DOCUMENTS: PAGE 2

Flings name troubles began anew. Cara Foods, which had developed a French fry-onion ring combo marketed as "Frings" challenged them. The challenge in front of the trademark board has cost the group thousands of dollars so far, but they intend to keep fighting. Why? Because they feel the chain has growth potential and they will fight for it.

QUESTION: __________________________________________________________

The entrepreneur starting his first venture puts a lot of thought into choosing a name, but often doesn't realize the legalities involved to make that name his own and protect against another entrepreneur laying claim to it.

It's not enough to hide behind squatter's rights. It's illegal in some areas to carry on a business without registering the name and the offender can be fined thousands of dollars. Furthermore, banks require the business registration number before opening an account in that name.

But how far the owner wants to go to protect a name depends on what the plans are for that business. For instance, if the business will never grow beyond using the home to produce Christmas baking where investment is minimal and advertising by word of mouth, expensive legal steps to secure a name may not seem necessary. But if, on the other hand, that kitchen is a launching pad for products the chef hopes will become household names exported around the world, the name will become a valuable piece of property and needs protection.

There are three levels of protection, namely registration, corporate name search, and registered trademark. When simply registering a name, no search is necessary and the company is open to lawsuits from other companies who have taken further legal steps to claim that name.

STUDENT DOCUMENTS: PAGE 3

If the business is incorporated, which gives protection against being sued personally, a corporate name search is necessary. In a province such as Ontario, it means tapping into a database known as NUANS to conduct a corporate name search before registering the name. The search determines if the identical name is being used or if there is one so similar that the common person would be confused. For instance, how similar are Tunnel Bar B-Q and Tunnel Bar?

If there are similar names, the entrepreneur must consider how extensively the name will be used, how big the company will grow and how likely the other guy is to grow. Usually the best idea is to get a new name. It may mean searching three to four to find a name that is not taken.

And the name must include a word that designates it as being incorporated such as Incorporated, Inc., Corporation, corp., Limited or Ltd. One of these must be used in dealings and on letterhead.

But it must be remembered that registering a name simply provides protection against someone else who has done nothing more than register their name. For example, a local entrepreneur might establish a credible business with expansion aspirations.

Unbeknownst to him, someone from another part of the country could visit the local community, return home and copy the idea, trademark the name and five years later come knocking on the door to have the local entrepreneur change the name or pay royalties for the right to continue using it.

STUDENT DOCUMENTS: PAGE 4

For exclusive, nation-wide protection of a name, a company must apply to become a registered trademark under the federal Trade-marks Act. It takes a couple of years and costs about $1 500- more if the name is challenged and requires a costly defense- but it grants exclusive use of the name. It becomes the company's private property and supersedes anyone who may have registered a similar name in the past or plans to register it in the future. It also provides a referee in case of disputes.

The whole point is that there is value in a name. Companies spend money for years building recognition for their name. To tap into it is viewed almost as theft and the company also wants to prevent a competitor's products from damaging their reputation.

And there is a psychology behind the value of a name. When a person thinks of a product, usually one or two company or brand names come to mind. Companies spend a lot of money to own that niche of names.

There are a number of twists in the area of trademarks. A local Canadian entrepreneur could see an interesting new business while vacationing in Florida, return home, get started locally and trademark it before the company in the United States expanded to Canada.

But a business that applies for a trademark in the United States can, under a treaty between the countries, apply within six months to own the trademark in Canada as well to prevent the above from happening.

A trademark can apply to the products of a region such as champagne from that region of France. Only Vintners from that geographic area can call their product Champagne. Bubbly made in Canada must label it as Canadian Champagne, a judge ruled in 1990, concluding a five-year-old case.

STUDENT DOCUMENTS: PAGE 5

Conversely, there are some products that become so widely known and used that they lose some claim to their exclusive use, such as Kleenex or aspirin. You want to be successful but not to the point where you lose your distinctiveness and the product name becomes generic and widely used.

Finally, a trademark must be used or it can be lost. A person cannot bank a pile of names and charge a license fee to those later seeking to use them.

STUDENT DOCUMENTS: PAGE 6

2) If a new corporation registers and trademarks a name in Canada, it is required by law to advertise it in:

5) If a business is incorporated, which of the following forms of name

STUDENT DOCUMENTS: PAGE 7

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