what you don't know about trademarks could hurt you badly. they were blind sided by cease and desist letters that shut them down. learn how to avoid costly litigation coming up next on "your business."

hi everyone. i'm j.j. ramberg and welcome to "your business," the show dedicated to helping your small business to grow. the whole point of having a brand and a logo to go with it is to make sure your business doesn't get confused with anyone else's. what happens when you are accused of violating another company's i.p. even if you never intended to? one thing, you may end up receiving a cease and desist letter. that's what happened to two businesses on the west coast who received those notices and could have lost everything.

santa cruz is a northern california beach town with a reputation for great surfing. catching the waves here is so popular the locals call their town surf city. >> you look around. you see surf city barbershops cafe everything everywhere. >> bruce noland is a third generation. >> we sell a lot of t-shirts sunglasses bikinis, men's shorts, i thinks for the beach. >> a few years ago bruce dashed off a t-shirt and moved letters around. >> santa cruz california let's throw aww onusa on the bottom. >> as soon as that happened it caught the attention of a surfing company 400 miles to the north and his mother was very

upset. >> she came to us with a letter. she wasn't sure what the letter was about. >> the letter threatening litigation claimed that huntington beach, california, also a popular surf town owned the trademark surf city usa. christina glyn helps local businesses. >> we sat down in the conference room. we red the letter. it was a cease and desist letter asking her to cease selling t-shirts emblazoned with the logo santa cruz surf city usa. >> you must agree to cease selling or in any other manner using the suv city usa marks. so what that's saying in plain english, unless you cease and desist immediately, we oar going to sue you. >> he's also a santa cruz

resident and a devoted surfer. >> e frankly was outraged that somebody could claim trademark rights to something so generic as surf city usa. >> he said trademarks like coca-cola can be registered as a brand and be protected. >> i knew it was really serious when i stepped into the federal building in san francisco on the 24th floor and i was up there with the atf and the fbi. >> bruce innocently thought it would be a great t-shirt, surf city santa cruz california usa. unbeknownst to him. >> my mom was a little freaked out, that she could lose her house, her swimming pool and everything. so i was i a little bit. >> when big organizations take on small mom and pops like the

nolands, it's not worth it but when he offered his services for free, they decided to fight back. they compromised. >> we move edd up a bit. >> today they're one of the top selling items in the shop. >> i would have had to cave in and let it go and they would have got their way but thanks to ted harold who's a local lawyer and a surfer. >> luckily for him there's a suffer dude lawyer who's me who libyas in santa cruz who saw what was going on and offered my services for free. >> my reaction when i got this letter was that this wasn't real. >> was like oh yeah that's got to be a truth. >> last september in portland oregon, they received their own cease and desist letter. >> right here i have a letter. dear miss cairo, it's come to the attention of the olympic

committee you're operating a charcuterie. we would ask you to discontinue using it. >> we thought that can't be. >> we came one that because we're in the olympic mills building. >> there's a ton of companies out there. >> you don't own the world olympic, like hello. like if anyone owns it it's the greeks who own. >> it we were baffled for sure. initially we figured there was a way around it. >> i called my attorney and i said, we might not deal with it. he said you do realize they can come and seize all your profits from prior years and your assets and i was like okay that's out of the question then. i was like we'll fight it. then my attorney informed me that no one to date has ever been successful. he said people with more money than our company have tried to fight this and have not.

the chances are too slim. >> at this point the brother and sister team had to decide whether they wanted to challenge the u.s. olympic system or back down which would mean relabeling, rebranding and reshooting all their promotional photos. >> we're looking at $65,000, $75,000. >> that would be to challenge their name from olympic provisions to oholympia. >> you don't have that history. if you're not at the top, you take a hit in sales. so i felt like i was doing it right way. we had an attorney do a name search, we had the attorney create the llcs and come to find out, we weren't. i thought that's what was so

frustrating. i consider myself fairly intell subsequent and i missed this. >> it's gone. i'm not going to dwell. it's not going to benefit me. you certainly do not ever want to be in a situation those business owners were in so let's dive into the subject a little bit more. rhett barney is an attorney at lee man & hayes. great to see you, rhett. >> hi how are you doing? >> you know what scares me about this piece is there's some obvious violations of someone else's ip right, so i wouldn't start a computer company and name it apple. but in these two cases it was relatively subtle, i think, from the small business owner's point of view. in the t-shirt one, let's take that first, they didn't name their company surf city usa. they made a t-shirt.

and so do you need to check every time you print something? every product you consider? >> i don't think it's necessary you check every single time but the world we live in now and the way commerce is really going, it makes it a lot easier for your products to make their way across various market places. so maybe 15 or 20 years ago the surf city usa would have stayed within the community but with the internet. they ended up working their way down. >> what do you do so you don't end up in that situation if you're printing a t-shirt or you have a new lipstick that you were naming something or you know, a flyer with something on it. >> yeah, yeah. so just starting very basically you just want to go online and see what other people are doing. we call it a clearance search. you look and you start with google and you work your way through yahoo! and you go to

bing and any particular search engine that you can and you see what's out there. and even if you're naming it something that you think is fairly genericscripscripdescriptive, it's worth taking a look at. a lot of times you want to go speak with an attorney. for example, surf city usa, he helped them work out a deal so they could use their particular trademark. they were able to co-exist. >> let's move to the second story. this is almost scarier. they did the search, right? they hired a lawyer and they found out or they assumed or thought based on what they learned it would be okay to name their company olympic provisions. it is a lot to change the name of your company once you're established. so what could they do wrong?

>> it's unclear if she did an actual trademark search or she went to the secretary of state. they're two different things. one is you're looking at trade name. the other, a trademark. you have to look beyond your statement there's a patent and trademark office. they have a website. to look there, you'll see its connected. the ted stevens act gives them more or less the exclusive right to use the word "olympic." >> what i'm getting is start with a basic search. whether you're naming a product or putting something on a t-shirt or specifically getting something. for the first two, hire an

attorney. for the second one if you're naming a company, definitely hire someone to help you out. >> i guess generally how much is at stake? if you're rebranding coming out with a whole new line of products, that's when you should similarly invelvet more money in the preparation. you know if you're doing something off the curve and you're not investing anything then it doesn't make sense. you have to feel thal out as a business owner. >> rhett barney thank you so much for shedding light on this. i know it was a scary situation. >> yeah, thank you very much. there are many ways to attract customers but most business psychologists agree appealing to emotions can be an effective sales tool. for one california business the fear of the unknown has made them a booming busy and a go-to

place for survival and preparements. >> it's so important to prepare people. >> i'm proud to be a prepper. >> while they proudly call themselves survivalists or preparers, they also call themselves entrepreneurs. >> we carry the products that you may need in an emergency to take care of your family. >> if you have to start with empty plastic bottles, get the ball rolling. let them know you have a supply of water to go to because, again, three days without water, you are dead. >> fear is a motivator. it's a powerful tool for marketing, good and bad.

>> he says they use fear. >> i would like you to work a plan and make your plan. >> one of the big keys is when people are fearful, you're given tools to deal with that fear and you give them a sense of control. >> i relate it back to insurance. people in our demographics want to be able to be comfortable and survive in an emergency. >> theechb the chance of something bad happening is small, we want to know it's something we don't have to worry about. >> like many preppers, dave a store manager, lives at a compound on this location. he keeps his emergency secure behind his fence. when that moment of crisis arrives, he feels he's going to bee b well prepared. he's got a solar heated stoesh water supplies solar supplies a defensive lookout tower and a

stocked pantry with nood food weapons, and medicine. darp told us one of his most important markets lessons came from one of his customer a prepper who came in right after the store opened. he was stationed nearby and a small comment made a big impression. >> he goes cool store. i wouldn't buy anything here. >> i said why's that? >> he said these are all survival kits. where's the mini wallet with the file in case i'm kidnapped. where are the knives. >> his customer didn't need to be lured into the store. when they arrived. they walked past the counter to get advice from customers in the back. one was an expert on dedicated

gear and politics. >> i said you know what? please get your head out of the ground, open your eyes and look a what's going on around you. >> he said, hey, i just want to hang out in your store. i want to talk to other people and i want to share ideas and learn what they're doing. >> that's when darryn decided to hire dave to man the front counter. >> my only complaint with dave is he's so good at talking sometimes he's not selling. >> you want to look at the fit of what they're selling. if you're a fitter and a survivalist, they're concerned about the situation at hand. they're already engamed. >> adams says industry that answers people's problems whether it's health fitness, or something else all walk a very fine line. >> you can overwhelm them with fear. not enough fear motivates people.

you find that sweet spot. that moderate level of control. >> if something happens, god forbid, i would want to be prepared for that. >> knowing who you're meeting with before you actually meet them can give you a leg up in the next business meeting. if you don't have the time to do the research yourself check out the website of the week. the site pulls from linked in, twitter, and major news sources and briefs you on the people you are about to meet. charlie lets you know what you share in common minutes before every point. using the right tools can be keys to executing a market plan hoochlter er five lesser known tools that can be a great help when it comes to getting the word out about your business courtesykur

courtesy courtesy. this way you can increase the chance your audience will be reached. two, narrow focuses on subjects relevant to your brand and industry so you can build a targeted twitter following of engaged users. three, contact marketer helps them promote influencers and build relationships with readers. you can also use the tool to find contact information by simply searching by articles they've written. 4, filament answers for specific questions you have about your analytics instead of reporting dense data. it's an all-in-one tool used for managed your business. and five, scroll depth. today's elevator pitcher

came up with a unique way to get a high-end beaut product look without paying the high prices. american express for travel and entertainment worldwide. just show them this - the american express card. don't leave home without it! and someday, i may even use it on the moon. it's a marvelous thing! oh! haha! so you can replace plane tickets, traveler's cheques, a lost card. really? that worked? american express' timeless safety and security are now available on apple pay. the next evolution of membership is here. this is from allison o'brien

who owns jwalking designs from union, new jersey. we want to see yours. send it to us. do not forget to use the hash tag #yourbizselfie. it's time to answer your questions. she's the founder and ceo of 37 angels an angel network where she teaches women how to invest in them. she's an assistant dean. and reva is the founder of grow biz media. in addition to helping entrepreneurs grow their brands. great to see both of you guys. it is from a veterinarian. he writes i'd like my associate to purchase a stake in the company but she's not interested. her contract is up soon and she

may leeb. i was thinking of offering her sweat equity. >> before we dive it into. explain sweat equity. >> you give somebody a percentage of ownership of the company without having to invest any money. it's based on the work they've put into the company. >> hence the sweat. let's dive into the meat of this. a good idea? >> it is certainly a good idea. but i would actually

>> your servers are going to crash. things are going to go wrong and you're going to ruin your customer engagement. >> this was incredibly helpful advice. you'll be giving more advice in the elevator soon. stick around for that. >> all righty. if any of you out there have a question for our experts, please just send us an e-mail or go to our website. openforum.com/your business. once you get there, hit the app for the show link and you could submit a question. openforum.com/your business or send us an e-mail to yourbusiness @msnbc.com. a few weeks ago, i was invited to a really fun poker tournament hosted by entrepreneur heidi messer. to kick off the evening she had a few people give elevator pitches in front of the crowd. i was so impressed with one of them we asked the pitcher to come on and see how it goes in our elevator.

>> hi. i'm lizzi klein and i founded super duper to let you in on the secrets of the $63 billion makeup universe. this bottle of chanel and this bottle of wet n wild is $26. enter super duper. we'll give you everything you need to choose the right products at the right prices for you. it's a free ios app with zero spend on marketing and pr we've had 7,000 downloads and fantastic press from tech crunch to the zo report. to bring it to android and web customers and to expand to include other products like eyeliner lipstick and mascara. if you're interested in getting in on the next break through in e-commerce, let's talk. thank you. >> congratulations on all the press. >> thank you. >> that's fantastic. >> all right. both of you guys. i want two numbers. one is what do you think of the

product and what do you think of the pitch? >> product's first? >> product's first. $26 and you get the same thing, basically you're saying? >> there's the proof. >> basically information. great, useful information to people? >> yes. we want to bring transparency to the beauty industry. >> rieva? >> for the product i think it's a nine. probably close to a 10. this is a product that i'm saying needs to exist for a long period of time. because women don't know. they spend money because there's a name and they don't realize that's all marketing. to know that this is actually equal to that i think, is a product that has long needed to exist in the makeup market. >> and the pitch? >> the pitch was seven. i know you're a little nervous. i think you could have included a little bit more information like target your demographic a little. are you going after all women? are you going after a smaller niche of women? i think that information would be really key.

and are you going to try working with some major retailers who are maybe selling those ksh like-- like ulta who sell both? >> you want to know a little bit more? >> i want to know more. >> angela you look at tons of pitches like this. >> slightly less positive in terms of a product, it's a seven. i agree, it's completely needed from a customer perspective and would use it as well. as a customer how am i dwth hear about it? right now it's only for nail polish and you're expanding, you said? >> yes. >> if i have to go to one other site just for this one thing i feel like it's not enough to get me to go to the 18th website of the day. >> sure. >> from a pitch perspective, i think you did a good job of explaining exactly what the product is, but not such a good job of understanding why is the customer going to be interested in this time and time again? this is a one time use thing, multiple use thing?

more importantly, how are you going to make mon sni. >> thank you so much. thank you for everything. if any of you out there have a product or service and you want feedback from our elevated pitch panel on getting prospective investors send us your e-mail at yourbusiness dat msnbc.com. include what your company does how much money you intend to raise and what you're going to do with that money. if you want to see any of the pieces from the show head on over to open forum.com/your business. we put up web exclusive content with information to help your business grow. @msnbc your biz and facebook and instagram too. next week we grab a seat on a hip hop bus tour giving riders a fresh look at new york. while everything may seem like a

smooth ride now, it wasn't always the case for this business owner. >> i was on a bus tour and from beginning to end i had truckloads and bags of speakers and portable speakers and cds. it was a mess. it was a mess. we'll see how outsourcing some of her work to another company gives her time to focus on the parts of her business that make her small business stand out. i'm swrchlt j rambergj.j. ramberg. remember, we make your business our business. american express for travel and entertainment worldwide. just show them this - the american express card. don't leave home without it! and someday, i may even use it on the moon. it's a marvelous thing! oh! haha! so you can replace plane tickets, traveler's cheques, a lost card. really? that worked?

american express' timeless safety and security are now available on apple pay. the next evolution of membership is here. war hero because he was captured. i like people who weren't captured. i hate to tell you. all right. good morning. thanks for getting up with us this sunday morning. we have a busy morning in store for you today including, but not limited to how donald trump, you just heard it there, how he is stirring new outrage. reaction from the republican party and beyond. has he finally gone too far? is this the beginning of the end of the trump surge? we'll get into that in a few minutes. we'll be sitting down for breakfast with senator chuck schumer from n