The answer is yes, they can. The DBA doesn`t protect the name. It merely gives you the right to use it in business instead of your legal name.
In Indiana, where I practice, the DBA is filed with the county recorder`s office, so you have to file in every county where you want to use that DBA.
If you think the name is that critical to your business and you`re not ready to incorporate, you might want to consider registering the domain name that corresponds to the company name. That can be easily done for under ten dollars.
Not necessarily. You should only incorporate or form an LLC when that structure makes sense for you (a whole different discussion). It`s usually not terribly expensive to start a corporation (filing fees), but the extra (ongoing) costs for various reports and tax filings could be significant.
Maybe an example would help clarify what I`m saying.
If you`re John Doe, an unincorporated sole proprietor, and you have registered a DBA (also known as a fictitious name) named John`s Terrific Plumbing Service, that allows you to operate using that name and prevents anyone else (in the jurisdiction where you registered) from operating as John`s Terrific Plumbing Service.
It does NOT give you any rights to reserve the name John`s Terrific Plumbing Service, Inc. That name can only be reserved or registered by a corporation, not an individual.
So, if John Smith forms a corporation before you do, he can use the name John`s Terrific Plumbing Service, Inc. You can still operate as a sole proprietor using the name John`s Terrific Plumbing Service.
I`m not an attorney, but based on my reading of the regulations on the web site of the Pennsylvania Department of State, I believe this is true in Pennsylvania.
For any business owner dealing with a similar issue, I`d suggest you look on your State`s web site or call them up. The rules and procedures are well-defined.
Actually, to clarify, from my experience as incorporator in all 50 states it is smart to stay away from names that already somehow are registered with the state, be it LLC, LP, Corporation, DBA, etc.
If the person in the Secretary of State office who will register the company thinks that the name is close to already existing one there is a high risk to have this application rejected. Why taking the risk then?
So if you have a DBA you might not be protected completely, but in reality you are somewhat protected.