Some companies impose restrictions on these code names as well. Usually because they have faced issues with code names before or simply have heard of too many issues. Here is a funny example of legal backlash in real life.
Back in the early 90s, Apple was working on a new mid-tier Mac. It was to be powerful but affordable one by standards of the day at ~$3000 with a whopping 250-700MB (yes, you newbies, megabytes not gigabytes) They thought it would be fun to honor famed astronomer and science educator Carl Sagan by naming the project after him.
Well, Mr Sagan wasn't really happy with Apple corporate at the time and complained publicly to stop it:
For this reason, I was profoundly distressed to see your lead front-page story ‘Trio of Power PC Macs spring toward March release date’ proclaiming Apple’s announcement of a new Mac bearing my name. That this was done without my authorization or knowledge is especially disturbing. Through my attorneys, I have repeatedly requested Apple to make a public clarification that I knew nothing of its intention to capitalize on my reputation in introducing this product, that I derived no benefit, financial or otherwise, from its doing so. Apple has refused. I would appreciate it if you so apprise your readership.” - Letter to MacWEEK
Well, this public complaint forced a name change to BHA. What's that? I'm sure officially, nothing. But it also came out that it really stood for "Butt-Head Astronomer". Yeah, that didn't make Mr Sagan happy either and brought on a lawsuit.
The judge responded to the claim
“There can be no question that the use of the figurative term ‘butt-head’ negates the impression that Defendant was seriously implying an assertion of fact. It strains reason to conclude the Defendant was attempting to criticize Plaintiff’s reputation of competency as an astronomer. One does not seriously attack the expertise of a scientist using the undefined phrase ‘butt-head.'”
- Butt-Head is a word that implicitly makes everything else silly
- Therefore the rest cannot be taken as serious defamation
BTW, after the lawsuit, they changed the name again to LAW. "Lawyers Are Wimps"
Source: Today in Apple history: Power Mac 7100 lands Apple in hot water with Carl Sagan