Expanding the Family Business Into the Third Generation

Third Wednesdays, noon- 1:30 p.m.

(Lunch to be provided)

May 16, 2012              Expanding the Family Business Into the Third Generation.  Ensuring successful transition of a family business takes special attention to managing interpersonal relationships, succession planning, estate planning and funding.

Speakers:

• Dave Vogelpohl (Excellerate Solutions, Inc.) Developing and maintaining family business relationships.
• Tim Hinton (Principal Financial Group) Exit Planning for Business Owners.
• Robin Pipkin (Tax Attorney, Sands Anderson PC) Identifying the business leaders and planning for the financial future of remaining family members.

The Business Success Series is for entrepreneurs and business owners who want to stay current on growth strategies and important business trends.  It meets monthly at Sands Anderson’s Raleigh office, 4101 Lake Boone Trail, Suite 100, Raleigh, NC 27607.

To register, email Heather (HJankovictz@sandsanderson.com) or call 919-706-4200. Space is limited.

Next Topic Green Plus: Sustainable Equals Successful (June 20, 2012)

Related articles

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I Paid My Taxes, Now What?

Third Wednesdays, noon- 1:30 p.m.

April 18, 2012             I Paid My Taxes, Now What? Five Triangle business advisors address best practices in planning for business growth in 2012.  The panel will discuss what’s notable in financing, accounting, employee management, legal and growth planning.

Speakers:

• Bryant Sikorski (Merrill Lynch Financial Advisor): What recent legislation means for tax planning and wealth accumulation.
• Joel Levy (the Entrepreneur’s CPA): How you can become less frustrated and overwhelmed by the accounting and tax-reporting requirements of your business.
• Don Emmett (Entrust Associates): What your company can do NOW to poise for sale or acquisition.
• Ann Close (HR Game Planner) Are your offensive, defensive and special teams strategies in place to win in 2012?
• Donna Ray Berkelhammer (Growing Business Attorney):  Top legal mistakes growing businesses make.

The Business Success Series is for entrepreneurs and business owners who want to stay current on growth strategies and important business trends.  It meets monthly at Sands Anderson’s Raleigh office, 4101 Lake Boone Trail, Suite 100, Raleigh, NC 27607.

To Register, email Heather (HJankovictz@sandsanderson.com) or call 919-706-4200.  Seating is limited.

Expanding the Family Business Into the Third Generation. (May16, 2012)

Many people understand “copyright” to prohibit the copying of original works of art. Perhaps they know not to “lift” website copy or articles, or not to copy whole chapters of books. Some even realize that photographs and other artwork appearing on websites are not always free for the taking.

But many don’t realize that “copyright” is actually a bundle of rights that gives the owner (artist) the exclusive rights to:

1. Copy the work;
2. Distribute the work;
3. Display the work;
4. Modify or create derivative works of the work;
5. Perform the work; and
6. In the case of sound recordings, to perform the work publicly by means of a digital audio transmission.

Many bars, restaurants and other retail shops are approached by ASCAP and BMI – which are the licensing clearinghouses for almost every songwriter, composer or musical publisher — to pay for a blanket license to play music  in the establishment.  Commercial cable and satellite TV accounts are more expensive than residential accounts because they include the cost of performance licenses.  Just owning a copy of a song, movie, game, etc. does not give you the right to play or perform the work publicly.  There are similar restrictions on commercial uses of radio and TV broadcasts, although there are exemptions for qualifying small businesses based on the type of business, size of the establishment and AV equipment used.

A public performance occurs when music or other copyrighted material is broadcast in any place where people gather, or where copyrighted material is transmitted to the public: radio or television broadcasts, music-on-hold, cable television, satellite television, and by the internet. Live music performances must also be licensed (unless the band doesn’t “cover” anyone else’s song, plays only original works, and has not affiliated itself with ASCAP or BMI). Music licenses start at several hundred dollars a year and go up from there, depending on the size of the establishment and the type of use.

A recent case shows the harm of not being properly licensed. The owners of a California restaurant that allowed a jazz combo to play covers of copyrighted John Coltrane songs, and also played the CD of another jazz group, were liable for $36,000 in statutory damages and almost $170,000 in attorney’s fees. The court found the restaurant corporation and its sole officer liable, even though a band it hired actually violated copyright law by performing  without a license. The restaurant owner repeatedly refused to buy a license from ASCAP, and ASCAP sent a private investigator on site to determine whether violations occurred.

Now more than ever, it is important to set up your business right from the start.

Related articles

• 50 Ways to Have an Attractive, but Non-Infringing Web Site
• But, Honestly, Copyright Protection is as American as Apple Pie, Even on the Internet (nclawlife.com)
• Fair Use FAQs (nclawlife.com)
• Copyright Registration FAQs: I’m Gonna Sit Right Down and Mail Myself a Letter (nclawlife.com)
• Archives Employee Admits To Copyright Infringement (baltimore.cbslocal.com)

The W-9 form can be downloaded here: http://www.irs.gov/pub/irs-pdf/fw9.pdf

Who gets a 1099 Form?

• Non-Employee Compensation or Independent Contractor. Businesses are required to file Form 1099-Misc for amounts of $600 or more paid for repairs, maintenance or other services performed by non-employees.  If you’ve hired carpenters, handymen, plumbers, electricians, accountants, landscapers or paid for other services from non-employees, have the contractor provide a W-9 and issue a 1099-Misc.
• Rents.  Rents collected in more than $600 in 2011 require a 1099-Misc, unless such rents are collected by a real estate agent.
• Royalties.  Royalties collected of $10 or more  in 2011 require a 1099-Misc.
• Gross Proceeds Paid to an Attorney.  If your business paid $600 or more in legal fees (even if it was for another entity), you need to file a 1099.  The exemption from reporting payments made to corporations do not apply to payments for legal services.

For more information, contact your tax attorney, your CPA or the following IRS Publication: http://www.irs.gov/pub/irs-pdf/i1099msc.pdf

Related articles

• What Are the Different 1099 Tax Forms? (turbotax.intuit.com)
• End of Year Tax Filings: Form 1099-MISC (smallbizsurvival.com)
• New Preparation Rules for an old form [Form 1099-MISC] and New Form 1099-K (abizinabox.wordpress.com)
• 2011 1099 Forms, Plus New Form 1099-K, Due This Month (blogs.findlaw.com)
• Online Business Owners Prepare for Form 1099-K (internetbiztaxtips.com)

I am inspired by entrepreneurs who base their business model on improving the wider community/environment.

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In August 2010, our legislature became one of the first to enact the low-profit limited liability company (L3C), which is a hybrid business form combining profit-making with socially responsible missions.  It can be the perfect venture for educational, scientific, literary or religious businesses that don’t want the hassle of complying with non-profit reporting requirements, or that have some activities that are not permitted by the federal tax code.

The L3C can be structured to take advantage of both non-profit and for-profit sources of capital.  It may offer marketing advantages by attracting socially aware investors and partners.  It may also attract private foundation program-related investments.

The biggest disadvantage, however, (and this is not a small disadvantage) is that the federal tax authorities have not ruled whether investments in L3Cs qualify as program-related investments.

We have a wide range of supports here for social entrepreneurship, including  informal meet-ups. formal academic programs at Duke and UNC,  community-based efforts to increase and support social entrepreneurism, and paid consultants.

How is your business giving back on a day-to-day basis?

Related articles

• One Entrepreneur Greets MLK Day with Work (smallbiztrends.com)
• United Way Triangle MLK Day of Service (unitedwaytriangle.org)
• Thousands In Triangle will Volunteer on MLK Day (nbc17.com)
• For-Profit Social Entrepreneurs (wealthartisan.com)
• The Rise of the Charitable For-Profit Entity (forbes.com)

Saturday, October 22, 2011 at the Community Room in Crabtree Valley Mall, Raleigh, NC.  

Why should you come?

The Keynote Speaker:

Olalah Njenga is the award-winning CEO of YellowWood Group, LLC, a strategic marketing firm that helps companies own their market and become unstoppable.  She is also the creator of Breakthrough Advantage™, an intensive event to help business owners create unfair competitive advantage.  A member of the National Speaker’s Association (NSA),  Olalah speaks nationally on business topics, including  one-page marketing plans, positioning and differentiation, the business relevance of social media and re-branding strategies to boost  industry presence.

The panelists:

Sue O'Lear

Sue O’Lear a.k.a “MrsFatAssBlogger” is a wife, mom, Nursing student, and writer. Her blog, Did I Just Eat That Out Loud? is a source of humor and motivation for anyone trying to live a healthier life. Cited in the July, 2010 issue of Women’s Health Australia magazine as one of the top blogs for laughter and inspiration, MrsFatass makes weight loss funny. speaks and provides training on a variety of business topics including entrepreneurship, market penetration, differentiation, branding and social media.

Born as a health and fitness blog, MrsFatass.com has grown into a mix of real life experiences, observations, successes, and flops in areas of diet, family, sex, friendship, social anxiety disorder, and pop culture. Read by men and women alike, MrsFatass.com’s unique blend of humor and honesty appeals to a varied audience, including mommy/daddy bloggers, humorists, foodies, fiction writers, and avid reality television junkies as well as the health nuts that were the first home for her voice.

Sue was born and raised in Flint, Michigan and graduated from the University of Michigan – Ann Arbor in 1996 with a degree in Organizational Psychology. She spent several years working in marketing for a for-profit educational company before becoming a full-time stay at home mom to her first child in 2003. She now resides in Wilson, North Carolina with her husband and her two children.

Kelly Duffort

Kelly Duffort is a web strategist with 10+ years of experience in adopting and applying interactive technologies for communicating key messages to target audiences. She is the principal and founder of KD Web Strategies, a consulting firm that advises companies how to take their overall web presence (e.g., websites, blogs, social media profiles) to the next level. Before striking out on her own, Kelly worked in web and communications roles at GlaxoSmithKline, Towers Watson and Booz, Allen & Hamilton. She is president of the local chapter of the International Association of Business Communicators, IABC Triangle.

Kelly says, “Whether you love it or hate it and whether you understand it or avoid it, social media is changing the way people communicate – personally and professionally. If you use social media wisely to promote your business, you will be amazed at the connections it enables you to make and the doors it opens for you.”

Leah D. Gordon

Leah D. Gordon is a public relations consultant and knowledge management specialist with over 10 years of experience serving a variety of clients from local government agencies to small business retailers. Leah is co-author of “Knowledge Management for Data Use and Decision Making for International Public Health.” She provides training in communication strategy, image development, building and managing online communities of practice, and effective use of online and traditional media to meet business objectives. She leverages multiple, no to low cost social media platforms to strengthen web presence.

Leah says “Social media allows two-way communication between businesses and consumers in ways we have never experienced before. The opportunities are amazing.”

Donna Ray Chmura

Donna Ray Chmura is a North Carolina growing business attorney with Sands Anderson’s Raleigh, NC office. She came to the practice of law after a career in journalism, with the intent of becoming a legal affairs writer to explain how laws and decisions affect people. Now, she works as a strategic partner with emergent and entrepreneurial businesses to analyze the business, legal and capital needs of her clients, and plan for the future. Coming from a family business background, she also enjoys working with start-ups to structure a strong legal foundation.

She is an author of NC Law Life, and is active on LinkedIn and Twitter.

Organized by Beverly Mahone, founder of Boomer Diva Nation, the summit will be moderated by executive life coach Martin Brossman.

President Obama at NC State University in Raleigh:

“The time for hand-wringing is over. The time for moping around is over. We’ve got to kick off our bedroom slippers and put on our marching shoes,” he said.

Obama’s job’s plan calls for tax cuts, infrastructure spending and new job training assistance to be funded by ending tax loopholes for corporations and American families earning more than $250,000 a year. According to the White House the act will create jobs in NC as follows:

• The President’s plan will cut the payroll tax in half to 3.1% for employers on the first $5 million in wages and in North Carolina, 170,000 firms will receive a payroll tax cut under the American Jobs Act.
• The President’s plan includes $50 billion in immediate investments for highways, transit, rail and aviation which would include at least $797,900,000 in North Carolina that could support a minimum of approximately 10,400 local jobs.
• The President plan proposes to invest $35 billion to prevent layoffs of teachers, while supporting the hiring of tens of thousands more and keeping cops and firefighters on the job. The plan will provide $900,300,000 in funds to North Carolina to support up to 13,400 educator and first responder jobs.
• The President’s plan includes a $25 billion investment in school infrastructure that will modernize at least 35,000 public schools across the country including $675,700,000 in funding to North Carolina to support as many as 8,800 jobs.
• The President’s proposed new Pathways Back to Work Fund would provide hundreds of thousands of low-income youth and adults with opportunities to work and to achieve needed training in growth industries and could place 4,000 adults and 12,700 youths in jobs in North Carolina.

Do you support this jobs bill?  How will it help the Tarheel State reduce unemployment? What else would you like from our state and local government?

Related articles

• President to rally support for American Jobs Act in Triangle (charlotte.news14.com)
• On tar and Tar Heels – Obama on N.C. infrastructure (politico.com)

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Guest post by Annemarie Cleary

What a week we just had in Virginia!  An earthquake, a hurricane with flooding, and swamp fire smoke all in one week.  If last week didn’t convince you to review, or prepare for the first time, a Business Continuity Plan (BCP), then the approaching ten-year anniversary of 9/11 should spur you to action.

The 9/11 attacks destroyed tens of thousands of vital records, irreplaceable documents and art.  The businesses affected lost employee records, customer lists and many, many more documents vital to business operations. As many employers on the East Coast are undoubtedly discovering, it doesn’t take a disaster as devastating as 9/11 to cause an interruption in business.  Earthquakes, hurricanes, floods and fires are just a small sample of the very real disasters that can strike your business.  Are you prepared to pick up the pieces?

Creating a BCP so that you can get your business up and running as soon as possible after a disaster is vital to your company’s long-term survival.  A BCP should include lists of emergency contact information, both internal and external, and a detailed recovery plan and should be developed with employees from all business units and levels of your company.

Begin by assessing the potential risks to your business’ ability to deliver products or services to customers.  Arizona business may need to plan for the effects of an evacuation due to forest fires, but not for a hurricane.  Businesses in North Carolina or Virginia, on the other hand, would be more likely to plan for flooding as a result of a hurricane, for an office fire or even for an earthquake.

After determining the risks that your business might face, consider how to mitigate the effects of those risks on business operations.  The objective is to compile a detailed step-by-step guide to getting your business running again.  You should:

• Identify the employees who are critical to the operations of your business, as well as a backup for each position in case key personnel are not available.  Your list should include every available means of contacting these individuals (e.g., business phone, home phone, cell phone, business and home email).
• Identify the critical products and services you provide to your customers and record the contact information for your most important customers so that you can stay in touch.
• Identify an alternative location from which to operate your business in the event your office is inaccessible.
• Identify contingency equipment options.  If, for example, the equipment your company uses to operate is its computers, contingency equipment options might include identifying which of your employees can telecommute.
• Identify what protections you need to take to preserve confidential client information.
• It is vital that your BCP includes a technology recovery plan.  You should regularly back up important IT data, such as customer lists, banking information, employee records and anything else that would be necessary to starting your business again.  Back up the information and arrange a secure off-site storage location.  Redundancy is the key.

Once you have all the necessary information, put your plan in writing.  Create step-by-step instructions on what to do, who should do it, when it should be done and how.  Ensure that critical personnel have copies of the plan and keep a copy off-site, too.  Then, practice and maintain your plan.  Review your plan periodically and walk through the plan with an imaginary disaster in mind.  Then, make changes where needed.

There are a number of websites that offer additional suggestions on developing a BCP, including the Federal Emergency Management Agency (FEMA) and Inc. .  You can alsocontact your employment attorney for assistance in preparing a plan.

Related articles

• Corporate Damage Control (nclawlife.com)

While many business owners are savvy enough to select the proper entity on their own, many do not understand the difference between trade names and trademarks. Others accidentally give the rights to their logos and other commissioned artwork to their graphic artist and the content of their website to their web host.  Some will think they can choose whether a worker is a contractor or an employee.  A good business attorney can address these issues on the front end, and save much expense and aggravation later.

Likewise, a good certified public accountant isn’t just a number cruncher — he or she is a trusted advisor who understands your business and today’s economic climate.  CPAs evaluate business ideas, plan for growth, minimize taxes, monitor cash flow and help keep proper financial records.  Poorly set up books can make it impossible for companies to track costs, make profits and attract financing.

Those of us that work with startups are familiar with the intersection of  providing value and penny-pinching, and can often work with the bootstrapped entrepreneur on how the services are provided and paid for.

Related articles

• Moving beyond the kitchen table (csmonitor.com)
• Bootstrapping Mistakes You Can Easily Avoid (startupbiz.wordpress.com)
• How to Get Good At Making Money (inc.com)
• About Starting a Small Business (thinkup.waldenu.edu)

Clients are bootstrapping like never before.  There are ways of doing business  that didn’t exist 10 years ago:  virtual assistants, fractional CFOS, co-working spaces.  We can attend meetings or place video phone calls via our laptops.  We store documents and software programs in the cloud.

And more ominously, we are doing more with fewer employees.

How are you becoming more efficient?

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I’ve been involved in Twitter discussion about the word “Mompreneur” based on this article at Forbes.com.  The article posits that women-led businesses have a tough time getting capitalized, especially if their products or services target women or families. @85Broads widened the discussion to whether there is a stigma to “mompreneur“.

As a woman professional, I have watched the “mompreneur” debate from the sidelines for a few years now, along with the related “mommy blogger” debate.

I am a professional.  I am also a mom.  I take both of these roles seriously, and sometimes they overlap. One Saturday, I held a deal together by Blackberry from the Museum of Life and Science.  I have a magnetic Thomas the Tank Engine set in my briefcase for those days where my kid has to come search titles.

I choose not to label myself a mompreneur or a mommy blogger.  Other women in my position embrace these labels.   When a woman self-labels herself a “mompreneur” or “mommy blogger”  (or when we women call each other “broad” or “bitch” or even “honey”), it is empowering because it is a choice and a self-identification.

But when male venture capitalists, investors, backers and bankers  use any of these terms, it is usually to denigrate, belittle or devalue  the women’s business.  It’s often the new shorthand for “Honey, I can’t give you a loan.  You should stay home and take care of your husband, who really deserves access to my capital because he has a family to support.” It’s shorthand for “This is just a hobby.”

Do you think there is  a stigma to being called a mompreneur or mommy blogger?

Low business costs (18 percent below the national average) and a smart labor force (42 percent have a college degree) make North Carolina’s capital an attractive spot for employers.  Job seekers get it: The net migration rate to Raleigh was the second highest in the U.S. over the past five years.

What makes Raleigh #1 for your business?

 NPR recently did a story about Grand Rapids, Michigan’s inspiring response to a Newsweek article listing Grand Rapids as one of America’s “dying cities” with a “bleak” economic outlook. Many small and medium business owners can empathize with what the people of Grand Rapids felt in the face of such a stark prediction, as business owners have been hearing from the media for years about how many businesses are failing with more hard times ahead.

Yet, the town of Grand Rapids did something inspiring in response. A small group of filmmakers, business people, and politicians rallied with a downtown production of hundreds of the town’s citizens, including prominent business leaders, students, government officials, and local news personalities, lip syncing to Don McLean’s hit, “American Pie.”

Watch the video here:

The video went viral fast, with over a million views on a holiday weekend. What is so inspiring about a town lip syncing?

1. It is quintessentially American. To respond to bad news by having a town-wide sing-along of “American Pie,” featuring cheerleaders, a pillow fight, a Nerf battle, the mayor riding in a convertible, and that plucky, small town, everybody-knows-everyone-else-and-we-can-all-pull-together-and-do-something-great . . . well, that is what the indomitable American spirit is all about. 
2. There is a time for grieving and a time for fun. “American Pie” is a perfect sing-along song, but it is also about overcoming grief and sharing that sadness with the entire community of Americans. As much as the song is about the literal death of musicians, it also stands as a powerful metaphor for the grief a lot of Americans are experiencing in this tough economy, from the loss of a job, a house, or a dream of graduating and getting started on a family. Yet, it also inspires a togetherness that leaves most people with a smile on their faces. The song “American Pie” is a great lesson in how to turn grief into community.
3. Cooperation. A lot of Americans seem fed up with partisan politics and the division in the country. It is refreshing to see a group of people react to a bad economic outlook not by playing party politics, but by banding together, regardless of ideology, and working to solve the problem by improving the image of their town.
4. Maybe there really is no such thing as bad press. The average American is tired of hearing about bleak economic forecasts and how there is no hope for the future. We, as a country, seem ready to face depressing headlines in the press and get outside and enjoy our towns, our neighbors, and have fun this summer, whatever lies ahead. And maybe, just maybe, that “Eh, whatever, let’s go have a pillow fight, then kayak down the river!” attitude in response to tough economic forecasts is just the thing that will prevent them from coming true. Getting out there in response to bad press and inspiring others to do the same certainly got more eyes on Grand Rapids than the hundreds of struggling towns that weren’t on Newsweek’s 10 Worst list.
5. Great use of social media.One lesson that the millions of people who watched the video may not have been realizing they were learning is that this is a fantastic use of social media to promote a “brand.”Too often social media marketing messages are too clearly “pitch” and not enough about the heart and soul of a brand. Small business owners looking to use YouTube or other types of social media to gain eyes (and hearts and minds) through a direct dialog to potential customers can learn a lot from Grand Rapids’ approach. Make your content fun, interesting, inspiring, and tell ‘em what is really at the heart of your brand and you will win new fans.

The Grand Rapids approach has a lot of great lessons for business owners looking for a creative solution to a tough economy. How will you apply these lessons to your own economic challenges?

If nothing else, sharing this video with your staff and colleagues may be a great way to spend 10 minutes energizing your employees and building a sense of community at your workplace.

Guest author Erin McNeill is a co-editor of Sands Anderson’s Risk Manager blog and is a second year associate at Sands Anderson specializing in general litigation, liability defense, and easements.

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The trademark geeks lawyers at Sands Anderson have been debating how far a company should go to “police” its trademarks.  Entrepreneur Media  (publisher of Entrepreneur magazine and owner of Entrepreneur.com) got us thinking about it:  in attempts to protect its Entrepreneur brand, it sent cease and desist letters to EntrepreneurOlogy.com for workshops, EntrepreneurPR, a firm that had a newsletter called Entrepreneur Illustrated, and 3Entrepreneurs, which  sold T-shirts, sweaters and hats with the phrase “Entrepreneur Generation”.

While it is never too soon to protect your company’s valuable trademark, registration alone is not enough. The owner of a trademark has to stop people from infringing its marks, known as policing the mark. 

It is a difficult line to walk. If you don’t police, you could be deemed to have abandoned your mark or have allowed infringing uses to go unchecked.  Too much (or inappropriate) policing can make your company look like a bully and generate bad PR. 

It is important to remember that a trademark registration protects the use of the brand name in connection with the goods and services provided in the registration only.  So if your registration is for ENTREPRENEUR.COM for “downloadable podcasts in the field of business, current events, lifestyle issues, and developments in science and technology”, is a Tshirt with “ENTREPRENEUR GENERATION” on it likely to cause confusion with your service?  Entrepreneur Media thought this was justified, because it had produced clothing with its “entrepreneur” logo.

The first step in policing is to find other people who are using your mark or something substantially similar that is likely to cause confusion in the marketplace. This can be done through search engine alert services or by hiring “watch” companies. Then you need to send a cease and desist letter, demading that the infringing use stop.  After that, there are a number of ways to maintain control of the mark from liecensing  the use to seizing and destroying infringing material. 

In addition to policing, maintaining a trademark after registration also includes making occasional post-registration filings. 

Related articles

• Entrepreneur Magazine a Trademark Bully… to Entrepreneurs (tacticalip.com)
• Creating, Protecting and Defending Brand Equity – Part 3 (circleid.com)
• Stay Out of Legal Hot Water: Website Trademark Issues (iplawforstartups.com)
• Get your name trademarked or get blog-squashed! (supernovaqueen.wordpress.com)
• The Highest Form of Flattery: Do knockoff Prada bags hurt Prada—or help the company sell more of the real thing? (slate.com)

Disney filed on an “intent-to-use” basis, meaning the applications will be reviewed, and if approved, Disney will have six months to begin actually using the trademark in commerce. 

Leaving aside questions of whether this name is owned by the Federal government, or whether this application is in bad taste, we wish more of our clients were as proactive as Disney in protecting their brands on the front end. 

Trademark usage and rights are a very complex area of law. Rights can be obtained in three different ways:

• Companies or individuals can obtain limited rights in trademarks just by using them in commerce. This is called “common law” protection and gives the company the exclusive right to use the mark in the area of actual use, plus a reasonable zone of expansion. Common law protection allows you to prevent other businesses from using a trademark in the same geographical area that is substantially similar to yours, and that would be likely to cause confusion to the consumer between your good or service and the other good or service. 
• Companies or individuals can obtain exclusive rights to use the trademark in a particular state by obtaining a state registration. A state registration gives you the right to stop others from using a substantially similar trademark anywhere in the state, regardless of where in the state you are actually using your trademark.  Obtaining a state registration takes a few months.  
• Companies or individuals using (or intending to use) their marks in interstate commerce can obtain exclusive rights to use the trademark in the United States by obtaining a federal registration.  A federal registration gives you the right to stop others from using a substantially similar trademark anywhere in the United states, regardless of where in the country you are actually using your trademark.  Obtaining a federal registration usually takes a more than a year, but it can be much longer. 

We are involved with a number of trademark infringement cases, and if we can make one point that would save our clients untold cost and aggravation, it would be to have them secure their rights in their brand name and logo early in the process.

What does this mean?  It means:

1. Before using a name or logo, make sure you have the rights to use it.  There is nothing worse than spending a lot of money on a logo, domain name, web site, business cards, marketing materials and signage and then getting letter demanding that you stop infringing someone else’s trademark.

2.  Register your name and logo on the state or federal level as soon as possible.  As Disney did above, you can file an application on the federal level before you have an actual product in the marketplace.  While you will have some limited rights based on non-registered use, there are significantly more arrows in the quiver when you have either a state or federal registration. 

Benefits of registration include: 

• Demonstrates Marketing and Business Savvy.  Having the official “stamp of approval” on your trademark (i.e., an official registration) can provide influence and credibility for your business. You may be working on a shoe-string out of your spare room, but you will present yourself as a savvy business owner who understands how to identify and protect your assets.  Customers, competitors and juries may involuntarily respond favorably to you because your mark is not just being used, but has been registered.  
• Deterrent effect.  Registration lets the world know that you are serious about protecting your brand name and reputation. If your mark is registered, the U.S. Patent and Trademark Office (or the state trademark office) will refuse to register any confusingly similar marks. Additionally, your mark will appear on trademark searches.  When other businesses consider a mark that is similar to yours, your mark will show up on the search report.  Most businesses would rather adopt a mark that is unique to their business and that does not run the risk of infringement or a lawsuit.  Simply letting them know you’re out there could prevent someone from stepping on your trademark toes.
• Priority of use.  The rights you get from just using your trademark are essentially limited to the geographic area of actual use.  A state registration gives you rights throughout the state, and a federal registration gives you rights throughout the country.  
• Access to Federal Courts.  A federal trademark registration gives easier access to federal courts.  Some lawyers prefer Federal courts because the procedures are standardized across the country.  Other lawyers prefer to file in state courts, where the process may be cheaper and quicker.  If you need to sue an infringer in another state, however, federal courts may be the preferred venue for access to justice.  
• Validity.  If you need to sue someone for trademark infringement, a state or federal registration easily proves that you are the owner with the right to stop someone else.  Otherwise, you have to spend the time and money to demonstrate the mark is valid, that you are the owner, you have not abandoned the mark and that you have continuously used the mark in interstate commerce. 
• Help Fighting Counterfeiters.  Owners of federal trademarks can get help from the US Customs service to help fight importation of counterfeit goods.

 What do you think about Disney’s trademark applications for SEAL TEAM 6?

Related articles

• http://www.usatoday.com/money/media/2011-05-17-disney-seal-team-6_n.htm
• The Mouse Takes Bin Laden: Disney Moves To Claim Trademark to “Seal Team Six” (jonathanturley.org)

The City’s Office of Economic and Workforce Development (OEWD) is now accepting applications for the Retail and Professional Services Grant Program, formerly known as the Merchandise-Based Incentive Grant Program. OEWD’s Retail and Professional Services Grant, specifically targeted for the Downtown Development Tier, will provide economic development incentives to eligible projects that support the creation, retention, or expansion of businesses within this tier. 

In order to be eligible for this grant, the project property must be a street-level retail business, restaurant, or a certain professional or personal services business including, but not limited to, law firms, architectural firms, financial services firms, childcare centers, or beauty salons. The applicant must be the owner of the property or have a fully signed lease and a letter of approval from the property owner supporting the proposed improvements. The business must be open at least five days a week, eight hours a day. Organizations that are not eligible to apply are religious organizations; government agencies or offices; businesses or private clubs that exclude minors as patrons; and residential projects.

Grant recipients are eligible to receive up to $15,000 in matching funds from the City for a project that meets eligibility criteria and scores high enough in the competitive evaluation process. Only funds spent on work performed after City approval of the grant are eligible for reimbursement. Eligible expenses include, but are not limited to, security systems, telephone systems, point-of-sale equipment, kitchen equipment, millwork, built-in display furnishings and shelving, HVAC, coolers, plumbing, demolition, flooring, grease traps, sprinkler systems, electrical, installation of walls, package and labeling equipment, and similar items.

To assist applicants with identifying whether proposed projects are located within the Downtown Development Tier, a state-of-the-art mapping application has been developed by the City’s Geographic Information Systems’ Division. The application is available on the City’s website.

 The deadline to apply for the grant is Monday, June 13, 2011, by 12 p.m. All efforts will be made to evaluate and determine funding requests within 45 days of the submission deadline. The City anticipates notifying applicants of their award status by Monday, July 18, 2011. 

For a complete description of the grant application guidelines, application process, and mapping application visit the City’s website at www.DurhamEconomicDevelopment.org. Interested applicants for proposed projects within the Downtown Development Tier may also contact Joy Mickle-Walker, coordinator of Downtown Development & Marketing with the City’s OEWD, via e-mail at Joy.Mickle-Walker@DurhamNC.gov or by phone at (919) 560-4965, ext. 15208.

 About the Office of Economic and Workforce Development

The City of Durham’s Office of Economic and Workforce Development (OEWD) implements a comprehensive and responsive business development strategy that supports business formation, retention, expansion, relocation, and employment opportunities created by the business development strategy. OEWD also works with community partners to ensure that Durham residents have opportunities to be placed and retained in these employment opportunities.

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To help businesses and individuals rebound from the destruction caused by severe weather and tornados on April 16, 2011, the Department of Revenue will waive late filing and late payment penalties for taxpayers who are unable to file their return or pay their tax because of the storm.

The penalties will be waived on state taxes and returns that are due between April 18th and May 1, 2011.  State law prevents the Department from waiving any interest.

To make sure they aren’t assessed a penalty, taxpayers should include Form NC-5500 with the late payment or return.  The form is available at all Department of Revenue offices and at www.dornc.com/downloads/penalty.html.  On the form, taxpayers should check the block for ‘natural disaster’ and fill in all the required information.  If a form is not sent with the payment or return, it can be completed later if the taxpayer is assessed a penalty.  A taxpayer that does not have this form can attach a letter explaining why the payment or return is late.

The extension for filing late taxes as a result of this storm may be extended as circumstances of the disaster are better known or if a federal disaster is declared.

If taxpayers have any questions they should call the Department’s Taxpayer Assistance Division at 1-877-252-3052, or visit our website.

Twenty-two people were killed and more than 130 injured by tornadoes and severe storms that struck at least 20 counties in North Carolina Saturday, state officials said Sunday. The fatalities occurred in Wake, Johnston, Cumberland, Harnett, Lee, Bertie and Bladen counties, said Julia Jarema, a spokeswoman for the state Department of Crime Control and Public Safety.

The North Carolina Department of Justice has some guidelines to help victims avoid being taken by home-repair and disaster assistance scammers.  WRAL has a great compliation of how you can help, and the Durham Bulls are a collection center for storm donations. 

Related articles

• Pain Amid the Progress As Tiny Victim Mourned(newsobserver.com)
• Why North Carolina, far from Tornado Alley, took brunt of big outbreak – Christian Science Monitor (news.google.com)
• Photos: Tornado Rips NC Houses “To Pieces”(patspapers.com)

David and I have known each other for several years through our pro-bono work in Durham County.  Like many attorneys, he is smart as a whip and has a knack for civil procedure and the rules of evidence.  What sets David apart is his practice philosophy.  David and I have a similar approach:  we take the time to understand our client’s needs and goals (and often cost parameters) and craft a legal solution that addresses all these factors. 

I have enjoyed collaborating with David in the past, and look forward to working with him in the future.  If you are involved in a contract dispute, have questions about ownership of your brand name, trademark, software or other intellectual property, or otherwise are involved in a business-related lawsuit, in my opinion, David is the right person to call.

Most of the attorneys I have worked with in my career (including opposing counsel) are ethical, caring professionals who truly want to help their clients meet a specific goal. Yet my most significant marketing challenge as a North Carolina business attorney remains gaining the trust of potential clients.  People have heard horror stories and are afraid to hire an attorney, even when they really need one. 

We are seen as liars and cheats– people who routinely drag things out to bill more fees.  We are called pit bulls, sharks, vultures and worse.  It is the bad apples that people remember.

What’s your experience with lawyers?  Do you see them as helping the process or a necessary evil?

(And if you are in the market for more lawyer jokes, click here.)

L3Cs are limited liability companies that have both a profit-purpose and a charitable or education purpose.  They were approved by the legislature on August 1, 2010.  About a dozen have been formed to date here.  They are intended to attract investment and funding sources that may not be available to traditional for-profit entities.

Proponents would like the L3C to become the entity of choice for “program-related investments” (known also as PRI) from  private foundations.  Private foundations are required by the IRS to distribute a percentage of their funds each year, either through grants, loans or other investments for mission-related activities (i.e., program-related investments).  Few private foundations make loans or investments because it is cumbersome and regulation-heavy.  It is easier to give outright grants. Because the L3C authorizing statutes contain certain PRI  language from the Internal Revenue Code , proponents hope private foundations will begin considering funding mixed use for-profit/charitable projects by investing in L3Cs. They are lobbying to get federal tax recognition for the PRI investments in L3Cs.

Another cutting edge social enterprise concept is the B-Corporation (“B” standing for Benefit).  Currently, B-corporations are not recognized via a specific statute in North Carolina, but a bill has been introduced in the North Carolina senate to recognize benefit corporations. Companies, however, can voluntarily be certified as B-corporations by B Labs, a non-profit organization.  The impact of being a “B Corp” now is like having a “Good Housekeeping Seal of Approval” — it is a certification from an independent third-party acknowledging your company’s commitment to serving society and the environment.  B Corps do not receive any specific tax breaks at the state or national level. 

Current corporation law is arguably geared toward maximizing profits for shareholders.  The L3C statute and proposed Benefit Corporation statutes are geared at making it acceptable legally for a company to focus on a social goal, perhaps to the detriment of the profit motive.  The L3C statute, for example, clearly states that the company should operate so that “no significant purpose of the company is the production of income or the appreciation of property.” It allows the owner to focus on meeting the social purpose without having to focus exclusively on return on investment.  The company is in no way prohibited from being profitable; it should not be the main focus.

 It is thrilling as a lawyer to be involved at the inception of a new entity — particularly one that will help people “do well by doing good.”