REPORT TITLE:
Financial institutions


DESCRIPTION:
Enables corporations, partnerships, and limited liability
companies to seek administrative relief against other entities
that have registered or are using a name that is substantially
identical or confusingly similar.  (SB1142 HD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        1142
THE SENATE                              S.B. NO.           S.D. 2
TWENTIETH LEGISLATURE, 1999                                H.D. 1
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO THE NAMES OF CORPORATIONS, PARTNERSHIPS, AND LIMITED
   LIABILITY COMPANIES.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Chapter 415, Hawaii Revised Statutes, is amended
 
 2 by adding a new section to be appropriately designated and to
 
 3 read as follows:
 
 4      "415-     Administrative order of abatement for
 
 5 infringement of corporate name.  (a)  Any domestic corporation in
 
 6 good standing or foreign corporation authorized to do business in
 
 7 this State claiming that the name of any domestic corporation,
 
 8 partnership, limited partnership, limited liability partnership,
 
 9 or limited liability company existing under the laws of this
 
10 State, or any foreign corporation, partnership, limited
 
11 partnership, limited liability partnership, or limited liability
 
12 company authorized to transact business in this State is
 
13 substantially identical to, or confusingly similar to, its name
 
14 may file a petition with the director for an administrative order
 
15 of abatement to address the infringement of its name.  The
 
16 petition shall set forth the facts and authority that support the
 
17 petitioner's claim that further use of the name should be abated.
 
18 The petitioner, at the petitioner's expense, shall notify the
 

 
Page 2                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 registrant of the hearing in the manner prescribed by chapter 91
 
 2 and the registrant shall be given an opportunity to respond to
 
 3 the petition at a hearing.  The notice shall be made and the
 
 4 hearing held in accordance with the contested case provisions of
 
 5 chapter 91.
 
 6      (b)  In addition to any other remedy or sanction allowed by
 
 7 law, the order of abatement may:
 
 8      (1)  Allow the entity to retain its registered name, but:
 
 9           (A)  Require the entity to register a new trade name
 
10                with the director; and
 
11           (B)  Require the entity to conduct business in this
 
12                State under this new trade name;
 
13           or
 
14      (2)  (A)  Require the entity to change its registered name;
 
15           (B)  Require the entity to register the new name with
 
16                the director; and
 
17           (C)  Require the entity to conduct business in this
 
18                State under its new name.
 
19 If the entity fails to comply with the order of abatement within
 
20 sixty days, the director may involuntarily dissolve or terminate
 
21 the entity, or cancel or revoke the entity's registration or
 
22 certificate of authority, after the time to appeal has lapsed and
 
23 no appeal has been timely filed.  The director shall mail notice
 

 
Page 3                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 of the dissolution, termination, or cancellation to the entity at
 
 2 its last known mailing address.  The entity shall wind up its
 
 3 affairs in accordance with chapter 415, 415A, 415B, 425, 425D, or
 
 4 428, as applicable.
 
 5      (c)  Any person aggrieved by the director's order under this
 
 6 section may obtain judicial review in accordance with chapter 91
 
 7 by filing a notice of appeal in circuit court within thirty days
 
 8 after the issuance of the director's order.  The trial by the
 
 9 circuit court of any such proceeding shall be de novo.  Review of
 
10 any final judgment of the circuit court under this section shall
 
11 be governed by chapter 602."
 
12      SECTION 2.  Chapter 415A, Hawaii Revised Statutes, is
 
13 amended by adding a new section to be appropriately designated
 
14 and to read as follows:
 
15      "415A-    Administrative order of abatement for
 
16 infringement of corporate name.  (a)  Any professional
 
17 corporation in good standing claiming that the name of any
 
18 domestic corporation, partnership, limited partnership, limited
 
19 liability partnership, or limited liability company existing
 
20 under the laws of this State, or any foreign corporation,
 
21 partnership, limited partnership, limited liability partnership,
 
22 or limited liability company authorized to transact business in
 
23 this State is substantially identical to, or confusingly similar
 

 
Page 4                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 with, its name may file a petition with the director for an
 
 2 administrative order of abatement to address the infringement of
 
 3 its name.  The petition shall set forth the facts and authority
 
 4 that support the petitioner's claim that further use of the name
 
 5 should be abated.  The petitioner, at the petitioner's expense,
 
 6 shall notify the registrant of the hearing and the registrant
 
 7 shall be given an opportunity to address the petition at a
 
 8 hearing.  The notice shall be made and the hearing held in
 
 9 accordance with the contested case provisions of chapter 91.
 
10      (b)  In addition to any other remedy or sanction allowed by
 
11 law, the order of abatement may:
 
12      (1)  Allow the entity to retain its registered name, but:
 
13           (A)  Require the entity to register a new trade name
 
14                with the director; and
 
15           (B)  Require the entity to conduct business in this
 
16                State under this new trade name;
 
17           or
 
18      (2)  (A)  Require the entity to change its registered name;
 
19           (B)  Require the entity to register the new name with
 
20                the director; and
 
21           (C)  Require the entity to conduct business in this
 
22                State under its new name.
 

 
 
 
Page 5                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 If an entity fails to comply with the order of abatement within
 
 2 sixty days, the director may involuntarily dissolve or terminate
 
 3 the entity, or cancel or revoke the entity's registration or
 
 4 certificate of authority, after the time to appeal has lapsed and
 
 5 no appeal has been timely filed.  The director shall mail notice
 
 6 of the dissolution, termination, or cancellation to the entity at
 
 7 its last known mailing address.  The entity shall wind up its
 
 8 affairs in accordance with chapter 415, 415A, 415B, 425, 425D, or
 
 9 428, as applicable.
 
10      (c)  Any person aggrieved by the director's order under this
 
11 section may obtain judicial review in accordance with chapter 91
 
12 by filing a notice of appeal in circuit court within thirty days
 
13 after the issuance of the director's order.  The trial by the
 
14 circuit court of any such proceeding shall be de novo.  Review of
 
15 any final judgment of the circuit court under this section shall
 
16 be governed by chapter 602."
 
17      SECTION 3.  Chapter 415B, Hawaii Revised Statutes, is
 
18 amended by adding a new section to be appropriately designated
 
19 and to read as follows:
 
20      "415B-     Administrative order of abatement for
 
21 infringement of corporate name.  (a)  Any domestic corporation in
 
22 good standing or foreign corporation authorized to do business in
 
23 this State claiming that the name of another domestic
 

 
Page 6                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 corporation, partnership, limited partnership, limited liability
 
 2 partnership, or limited liability company existing under the laws
 
 3 of this State, or any foreign corporation, partnership, limited
 
 4 partnership, limited liability partnership, or limited liability
 
 5 company authorized to transact business in this State is
 
 6 substantially identical to, or confusingly similar with, its name
 
 7 may file a petition with the director for an administrative order
 
 8 of abatement to address the infringement of its name.  The
 
 9 petition shall set forth the facts and authority that support the
 
10 petitioner's claim that further use of the name should be abated.
 
11 The petitioner, at the petitioner's expense, shall notify the
 
12 registrant of the hearing and the registrant shall be given an
 
13 opportunity to address the petition at a hearing.  The notice
 
14 shall be made and the hearing held in accordance with the
 
15 contested case provisions of chapter 91.
 
16      (b)  In addition to any other remedy or sanction allowed by
 
17 law, the order of abatement may:
 
18      (1)  Allow the entity to retain its registered name, but:
 
19           (A)  Require the entity to register a new trade name
 
20                with the director; and
 
21           (B)  Require the entity to conduct business in this
 
22                State under this new trade name;
 
23           or
 

 
Page 7                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1      (2)  (A)  Require the entity to change its registered name;
 
 2           (B)  Require the entity to register the new name with
 
 3                the director; and
 
 4           (C)  Require the entity to conduct business in this
 
 5                State under its new name.
 
 6 If an entity fails to comply with the order of abatement within
 
 7 sixty days, the director may involuntarily dissolve or terminate
 
 8 the entity, or cancel or revoke the entity's registration or
 
 9 certificate of authority, after the time to appeal has lapsed and
 
10 no appeal has been timely filed.  The director shall mail notice
 
11 of the dissolution, termination, or cancellation to the entity at
 
12 its last known mailing address.  The entity shall wind up its
 
13 affairs in accordance with chapter 415, 415A, 415B, 425, 425D, or
 
14 428, as applicable.
 
15      (c)  Any person aggrieved by the director's order under this
 
16 section may obtain judicial review in accordance with chapter 91
 
17 by filing in the court a notice of appeal in circuit court within
 
18 thirty days after the issuance of the director's order.  The
 
19 trial by the circuit court of any such proceeding shall be de
 
20 novo.  Review of any final judgment of the circuit court under
 
21 this section shall be governed by chapter 602."
 
22      SECTION 4.  Chapter 425, Hawaii Revised Statutes, is amended
 
23 by adding to part VI a new section to be appropriately designated
 
24 and to read as follows:
 

 
Page 8                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1      "425-     Administrative order of abatement for
 
 2 infringement of partnership name.  (a)  Any domestic partnership
 
 3 in good standing formed under this chapter or foreign partnership
 
 4 authorized to do business in this State under this chapter
 
 5 claiming that the name of another domestic corporation,
 
 6 partnership, limited partnership, limited liability partnership,
 
 7 or limited liability company existing under the laws of this
 
 8 State, or any foreign corporation, partnership, limited
 
 9 partnership, limited liability partnership, or limited liability
 
10 company authorized to transact business in this State is
 
11 substantially identical to, or confusingly similar with, its name
 
12 may file a petition with the director for an administrative order
 
13 of abatement to address the infringement of its name.  The
 
14 petition shall set forth the facts and authority that support the
 
15 petitioner's claim that further use of the name should be abated.
 
16 The petitioner, at the petitioner's expense, shall notify the
 
17 registrant of the hearing and the registrant shall be given an
 
18 opportunity to address the petition at a full hearing.  The
 
19 notice shall be made and the hearing held accordance with the
 
20 contested case provisions of chapter 91.
 
21      (b)  In addition to any other remedy or sanction allowed by
 
22 law, the order of abatement may:
 

 
 
 
Page 9                                                     1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1      (1)  Allow the entity to retain its registered name, but:
 
 2           (A)  Require the entity to register a new trade name
 
 3                with the director; and
 
 4           (B)  Require the entity to conduct business in this
 
 5                State under this new trade name;
 
 6           or
 
 7      (2)  (A)  Require the entity to change its registered name;
 
 8           (B)  Require the entity to register the new name with
 
 9                the director; and
 
10           (C)  Require the entity to conduct business in this
 
11                State under its new name.
 
12 If an entity fails to comply with the order of abatement within
 
13 sixty days, the director may involuntarily dissolve or terminate
 
14 the entity, or cancel or revoke the entity's registration or
 
15 certificate of authority, after the time to appeal has lapsed and
 
16 no appeal has been timely filed.  The director shall mail notice
 
17 of the dissolution, termination, or cancellation to the entity at
 
18 its last known mailing address.  The entity shall wind up its
 
19 affairs in accordance with chapter 415, 415A, 415B, 425, 425D, or
 
20 428, as applicable.
 
21      (c)  Any person aggrieved by the director's order under this
 
22 section may obtain judicial review in accordance with chapter 91
 
23 by filing a notice of appeal in circuit court within thirty days
 

 
Page 10                                                    1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 after the issuance of the director's order.  The trial by the
 
 2 circuit court of any such proceeding shall be de novo.  Review of
 
 3 any final judgment of the circuit court under this section shall
 
 4 be governed by chapter 602."
 
 5      SECTION 5.  Chapter 425D, Hawaii Revised Statutes, is
 
 6 amended by adding a new section to be appropriately designated
 
 7 and to read as follows:
 
 8      "425D-     Administrative order of abatement for
 
 9 infringement of limited partnership name.  (a)  Any domestic
 
10 limited partnership in good standing or foreign limited
 
11 partnership authorized to do business in this State claiming that
 
12 the name of another domestic corporation, partnership, limited
 
13 partnership, limited liability partnership, or limited liability
 
14 company existing under the laws of this State, or any foreign
 
15 corporation, partnership, limited partnership, limited liability
 
16 partnership, or limited liability company authorized to transact
 
17 business in this State is substantially identical to, or
 
18 confusingly similar with, its name may file a petition with the
 
19 director for an administrative order of abatement to address the
 
20 infringement of its name.  The petition shall set forth the facts
 
21 and authority that support the petitioner's claim that further
 
22 use of the name should be abated.  The petitioner, at the
 
23 petitioner's expense, shall notify the registrant of the hearing
 

 
Page 11                                                    1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 and the registrant shall be given an opportunity to address the
 
 2 petition at a full hearing.  The notice shall be made and the
 
 3 hearing held in accordance with the contested case provisions of
 
 4 chapter 91.
 
 5      (b)  In addition to any other remedy or sanction allowed by
 
 6 law, the order of abatement may:
 
 7      (1)  Allow the entity to retain its registered name, but:
 
 8           (A)  Require the entity to register a new trade name
 
 9                with the director; and
 
10           (B)  Require the entity to conduct business in this
 
11                State under this new trade name;
 
12           or
 
13      (2)  (A)  Require the entity to change its registered name;
 
14           (B)  Require the entity to register the new name with
 
15                the director; and
 
16           (C)  Require the entity to conduct business in this
 
17                State under its new name.
 
18 If an entity fails to comply with the order of abatement within
 
19 sixty days, the director may involuntarily dissolve or terminate
 
20 the entity, or cancel or revoke the entity's registration or
 
21 certificate of authority, after the time to appeal has lapsed and
 
22 no appeal has been timely file.  The director shall mail notice
 
23 of the dissolution, termination, or cancellation to the entity at
 

 
Page 12                                                    1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 its last know mailing address.  The entity shall wind up its
 
 2 affairs in accordance with chapter 415, 415A, 415B, 425, 425D, or
 
 3 428, as applicable.
 
 4      (c)  Any person aggrieved by the director's order under this
 
 5 section may obtain judicial review in accordance with chapter 91
 
 6 by filing a notice of appeal within thirty days after the
 
 7 issuance of the director's order.  The trial by the circuit court
 
 8 of any such proceeding shall be de novo.  Review of any final
 
 9 judgment of the circuit court under this section shall be
 
10 governed by chapter 602."
 
11      SECTION 6.  Chapter 428, Hawaii Revised Statutes, is amended
 
12 by adding a new section to be appropriately designated and to
 
13 read as follows:
 
14      "428-     Administrative order of abatement for
 
15 infringement of limited liability company name.  (a)  Any
 
16 domestic limited liability company in good standing or foreign
 
17 limited liability company authorized to do business in this State
 
18 claiming that the name of another domestic corporation,
 
19 partnership, limited partnership, limited liability partnership,
 
20 or limited liability company existing under the laws of this
 
21 State, or any foreign corporation, partnership, limited
 
22 partnership, limited liability partnership, or foreign limited
 
23 liability company authorized to transact business in the State is
 

 
Page 13                                                    1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 substantially identical to, or confusingly similar with, its name
 
 2 may file a petition with the director for an administrative order
 
 3 of abatement to address the infringement of its name.  The
 
 4 petition shall set forth the facts and authority that support the
 
 5 petitioner's claim that further use of the name should be abated.
 
 6 The petitioner, at the petitioner's expense, shall notify the
 
 7 registrant of the hearing and the registrant shall be given an
 
 8 opportunity to address the petition at a full hearing.  The
 
 9 notice shall be made and the hearing held in accordance with the
 
10 contested case provisions of chapter 91.
 
11      (b)  In addition to any other remedy or sanction allowed by
 
12 law, the order of abatement may:
 
13      (1)  Allow the entity to retain its registered name, but:
 
14           (A)  Require the entity to register a new trade name
 
15                with the director; and
 
16           (B)  Require the entity to conduct business in this
 
17                State under this new trade name;
 
18           or
 
19      (2)  (A)  Require the entity to change its registered name;
 
20           (B)  Require the entity to register the new name with
 
21                the director; and
 
22           (C)  Require the entity to conduct business in this
 
23                State under its new name.
 

 
Page 14                                                    1142
                                     S.B. NO.           S.D. 2
                                                        H.D. 1
                                                        

 
 1 If an entity fails to comply with the order of abatement within
 
 2 sixty days, the director may involuntarily dissolve or terminate
 
 3 the entity, or cancel or revoke the entity's registration or
 
 4 certificate of authority, after the time to appeal has lapsed and
 
 5 no appeal has been timely filed.  The director shall mail notice
 
 6 of the dissolution, termination, or cancellation to the entity at
 
 7 its last known mailing address.  The entity shall wind up its
 
 8 affairs in accordance with chapter 415, 415A, 415B, 425, 425D, or
 
 9 428, as applicable.
 
10      (c)  Any person aggrieved by the director's order under this
 
11 section may obtain judicial review in accordance with chapter 91
 
12 by filing a notice of appeal within thirty days after the
 
13 issuance of the director's order.  The trial by the circuit court
 
14 of any such proceeding shall be do novo.  Review of any final
 
15 judgment of the circuit court under this section shall be
 
16 governed by chapter 602."
 
17      SECTION 7.  New statutory material is underscored.
 
18      SECTION 8.  This Act shall take effect upon its approval.