Last August, the Utah Supreme Court decided that David Lynn Porter could change his name to Santa Claus. The Supreme Court overruled the trial court, which feared the name Santa Claus would confuse people. The trial court also feared that the name would hinder access to the courts, because people would hesitate to sue Santa Claus. However, the Supreme Court concluded that neither of those concerns constituted a "substantial reason" to deny the name change.
Name changes for businesses, unlike name changes for individuals, can be made without an appearance before a judge. Filing name change documents with the Department of Commerce usually suffices. However, the business and legal ramifications of making a company name change can be just as complicated as Porter's sleigh ride through the courts to become Santa Claus.
The experiences of Utah's Mountain Fuel Supply in changing its name to Questar illustrate some of the costs, benefits and procedures.
Names as Business Assets
Mountain Fuel Supply Company was a venerable Utah institution, established in 1935. By 1984, its business had diversified, expanding from a local utility to a regional energy company. "We needed a new name to convey that new image," says Curt Burnett, vice president of public affairs for Questar.
Mountain Fuel consulted a New York corporate identification firm that specialized in branding. "Our advisors agreed that 'Questar' is a strong word, combining both 'quest' and 'star,'" explains Burnett. In 1984, the name of the Mountain Fuel holding company was changed to "Questar," and in 1998 names of subsidiaries were changed to incorporate "Questar." "We made the change in order to strengthen the brand and have more brand equity," says Burnett. "The change of subsidiary names also had a unifying effect internally. It was important that all of our divisions felt connected."
Company names are valuable assets
The law provides for names to be bought and sold, as well as protected from use or misuse by other companies. As with any purchase or sale of a business, transfer of ownership to the company name, as well as logo and slogans, should be carefully negotiated and documented. With any name change, the effect on the value of the company should be considered.
Name changes should be properly filed with state agencies. Although the Utah Department of Commerce is the proper spot for filing corporate name changes, other agencies should be consulted to make sure name changes are...