Key point 6-05. A church name is a valuable property right that is protected by the legal principle of unfair competition. Protection also is available under federal trademark law.
Occasionally, a new church will acquire a name that is so similar to the name of another church in the same community that public confusion is likely to result. For example, a new congregation calling itself Calvary Presbyterian Church establishes a church in a community already having a Presbyterian church called "Calvary Church." A confusion of names may occur in other ways, such as a new sect or religious denomination acquiring a name similar to that of an existing one, or a local church withdrawing from a denominational organization but continuing to employ a name associating itself with the denomination. In any of these situations, does the preexisting church body have any legal basis for stopping further use of the similar name by the other church or religious organization?
The courts protect the names of existing commercial enterprises against unauthorized use of confusingly similar names by other commercial organizations. See, e.g., Standard Oil Company of New Mexico v. Standard Oil Company of California, 56 F.2d 973 (10th Cir. 1932); Association of Contracting Plumbers v. Contracting Plumbers Association, 302 N.Y 495 (N.Y. 1951). In many instances, the courts are simply enforcing state corporation laws that, in most states, prohibit new corporations from using names that are identical or confusingly similar to those of existing organizations. Other courts have emphasized that such name protection statutes are merely embodiments of the underlying common law of unfair competition, which protects existing corporate names independently of any provisions in state corporate laws. Massachusetts Mutual Life Ins. Co. v. Massachusetts Life Ins. Co., 218 N.E.2d 564, 570 (Mass. 1966) ("It is our view, however, that the corporate name protection statute is a statutory declaration and clarification of a portion of the extant common law of unfair competition. …"); Virginia Manor Land Co., v. Virginia Manor Apartments, Inc., 282 A.2d 684, 687 (Pa. 1971) ("[t]he right of the corporation to the exclusive use of its own name exists at common law, and includes the right to prohibit another from using a name so similar to the corporate name as to be calculated to deceive the public").
The courts also will protect the names of nonprofit corporations on the basis of one or more of the following theories:
- the applicable nonprofit corporation statute contains a provision protecting the preexisting names of nonprofit corporations in much the same way as business corporation statutes protect the names of business corporations; See, e.g., 805 ILL. COMP. STATS. § 105/104.05. ch. 32, § 163a(6); MODEL NONPROFIT CORPORATION ACT § 7(b).
- extension of the name protection provided by business corporation statutes to nonprofit corporations when the state nonprofit law does not specifically provide such protection; First Congressional District Democratic Party Organization v. First Congressional District Democratic Organization, Inc., 177 N.W.2d 224 (Mich. 1970).
- the common law of unfair competition; Oklahoma District Council of the Assemblies of God v. New Hope Assembly of God, 597 P.2d 1211 (Okla. 1979). and
- trademark protection.
In states having a name protection statute protecting the names of religious corporations, a church's name generally will be protected against later use of the same or a confusingly similar name in either of two ways:
(1) the state official charged with the duty of reviewing applications for incorporation can reject the application of an organization whose name is either identical or deceptively similar to the name of an existing corporation; or
(2) if the state official chooses to recognize the corporate status of an organization whose name is either identical or deceptively similar to that of an existing corporation, the offended corporation may sue to stop further use of the name.
A church may seek legal protection of its name through the law of unfair competition. Unfair competition is a civil wrong created to protect existing organizations from the deceptive or unfair practices of competitors. It is entirely separate and distinct from trademark law. Among other things, unfair competition means the use of a name that is either identical with or confusingly similar to that of a preexisting organization. As one court has observed:
In the law of unfair competition, a corporate or trade name used in connection with the business to which it relates may become an asset of great value. When it does, it partakes of the nature of a property right, and equity will enjoin the appropriation and use of such name if confusion of identity is likely to result. Id. at 1214.
Courts have consistently protected charitable as well as business organizations from unfair competition. In a leading case one court observed:
We hold that the common law principles of unfair competition protecting business corporations against another's use of the same or similar name are applicable to charitable or religious associations and corporations. … The right to this protection rests generally upon the fact that the use of identical or similar terms or names is likely to result in confusion or deception. Id. at 1215. See also National Board of YWCA v. YWCA of Charleston, 335 F. Supp. 615 (D.S.C. 1971).
To successfully establish that the name chosen by another organization constitutes unfair competition, a church must demonstrate:
1. Prior use of the name.
2. Subsequent use of the same or a confusingly similar name by another religious organization.
3. The church with prior use of the name will be adversely affected by continued use of the same or a confusingly similar name by the other religious organization. An adverse impact generally will be established by the unauthorized use of a name identical or confusingly similar to that of a preexisting corporation.
4. The church with prior use of the name did not delay for an unreasonable time in seeking to enjoin further use of the same or a confusingly similar name by the other religious organization. See generally Annot., 37 A.L.R.3d 277 (1971).
Generic or highly generalized names are not protected from misappropriation under the doctrine of unfair competition unless a secondary meaning has been established. A generic name acquires a secondary meaning through such continued use that it is commonly associated with a particular church or religious organization in the public mind. Proof of a secondary meaning is a question of fact to be established on a case-by-case basis.
A local church congregation that votes to disaffiliate from a parent denomination may lose the right to use the denominational name. One court observed:
The local name of a church is of great value, not only because business is carried on and property held in that name, but also because millions of members associate with the name the most sacred of their personal relationships and the holiest of their family traditions. And, since the right to use the name inheres in the institution, not in its members … when they cease to be members of the institution, use by them of the name is misleading and, if injurious to the institution, should be enjoined. Carnes v. Smith, 222 S.E.2d 322, 329 (Ga. 1976) (citations omitted).
In some cases the name of a church or religious organization can be protected under federal trademark law. Trademark is defined by the federal Trademark Act as "any word, symbol, or device, or any combination thereof adopted and used by a manufacturer or merchant to identify his goods and distinguish them from those manufactured and sold by others." 15 U.S.C. § 1127. Trademark protection is available to any church or religious organization that uses a particular name to identify goods or services it offers to the public. For example, if a religious denomination publishes religious literature for its churches, and affixes its name to such literature, the name identifies the goods and therefore is eligible for trademark registration. Similarly, if a church establishes a counseling center, correspondence school, private elementary or secondary school, nursing home, radio or television station, or magazine that is identified by the church's name, the name may be entitled to trademark protection.
Trademark protection is not available for a name or mark that so resembles a mark already registered with the Patent and Trademark Office, or previously used by another organization and not abandoned, as to be likely to cause confusion or to deceive. There are two ways of determining whether a proposed name conflicts with a preexisting name that is entitled to protection. First, a commercial search service can be retained which, for a fee, will render an opinion on the availability of a specified name. Second, an application for registration can be filed with the Patent and Trademark Office in Washington, D.C. Although the Patent and Trademark Office takes several months to evaluate an application, it eventually will notify the applicant whether its proposed name or mark conflicts with a preexisting mark.
"Descriptive" and highly generalized names and marks are not eligible for registration unless a secondary meaning can be established. A secondary meaning is established by proof of public association of a generic name or mark with a particular church or religious organization. So-called "generic" marks may not be capable of trademark protection even if a secondary meaning is present. The distinction between descriptive and generic marks is a close one that has caused the courts considerable difficulty.
Terms that may be registered as trademarks fall into four categories of strength: (1) generic; (2) descriptive; (3) suggestive; or (4) arbitrary. Generic terms are those which name "the class of which an individual article or service is but a member." Descriptive terms "identify a characteristic or quality of an article of service." Suggestive terms suggest characteristics of the goods and services and "require an effort of the imagination by the consumer in order to be understood as descriptive." Arbitrary or fanciful terms are words or phrases that bear no direct relationship to the product.
Generic terms represent the weaker end of the spectrum and arbitrary terms represent the stronger. Generic terms may never be registered as trademarks, and descriptive terms may not be registered as trademarks unless the holder shows that the mark has acquired "secondary meaning" (the mark has become distinctive of the trademark holder's product or services).
A federal court in Florida ruled that a local church's unauthorized use of the name "Seventh-Day Adventist" (and the acronym "SDA") could be prohibited on the ground that they violated the national Seventh-Day Adventist Church's trademark. General Conference Corporation of Seventh-Day Adventists v. Perez, 97 F.Supp.2d 1154 (S.D. Fla. 2000). See also General Conference Corp. of Seventh-Day Adventists v. McGill, 2008 WL 2404036 (W.D. Tenn. 2008) (a federal court in Tennessee ruled that the "Seventh-Day Adventist" registered trademark had not been lost by becoming generic, and therefore the Seventh-Day Adventist Church could enjoin a dissident pastor from using the words "Seventh-Day Adventist" in his church's name). The court concluded that even if the mark "Seventh-Day Adventist" was descriptive, it was still entitled to protection since the mark had acquired a secondary meaning through "the continuous and uninterrupted use" of the mark "for over 139 years." It further observed:
[The mark] is used in [the national church's] denominational, corporate and trade name (Seventh-day Adventist Church) and in all of its Union Conference names, its local conferences, and virtually all of its Seventh-day Adventist Churches throughout the United States. [Its] mark has become distinctive as a result of the large number of people who have been ministered to and served through its churches and publications, its schools, colleges and universities, its hospitals and its national outreach under the mark [and] acronym SDA. Through members, workers, ministers and pastors and associated health and education programs, media centers, publishing houses and the publications thereof, the mark … and acronym SDA have become famous and synonymous with the good will and quality of the Seventh-day Adventist Church. Plaintiff has expended considerable effort and expense over the last 139 years in promoting its mark … and the products and services associated therewith, and consequently the mark is entitled to broad protection.
The court noted that consumer surveys are "recognized as the most direct and persuasive evidence of secondary meaning," and that a survey conducted by the national church proved that its use of the mark "has resulted in the general public in the United States identifying the words 'Seventh-Day Adventist' with the [national church]."
The court rejected the new church's claim that its use of the national church's mark was permitted by the First Amendment guaranty of religious freedom. It concluded: "It is well established that religious institutions are entitled to the protection of the trademark and unfair competition laws to the same extent as commercial enterprises and enforcement of the trademark statute does not abridge the religious freedom rights of a religious group that is infringing on a church's trademark or service mark."
An application for trademark registration is a relatively simple procedure consisting of the following elements:
1. Preparation of a written application stating the applicant's name, address, state of incorporation or organization; the goods or services in connection with which the name or mark is used; the class of goods or services according to the official international classification system; the date of the first use of the name or mark on or in connection with the goods or services; the date of the first use of the name or mark as a trademark "in commerce"; the mode or manner in which the mark is used on or in connection with the goods.
2. A drawing of the mark, unless the mark consists solely of a name—in which case the name may be typed in capital letters on a piece of paper.
3. Five specimens of the goods bearing the name or mark. No specimens are required for names or marks associated with services.
4. The required filing fee.
If a church name is not used in connection with any specific goods or services, trademark protection is unavailable.