**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      D.C. 20549




**FORM
      10-QSB**




(Mark
      One)




**x
      QUARTERLY REPORT
      PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES**


**EXCHANGE
      ACT OF 1934**




For
      the
      quarter ended February
      29, 2008




**o
      TRANSITION REPORT
      PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES**


**EXCHANGE
      ACT OF 1934**




For
      the
      transition period from _____________ to ____________




*Commission
      File Number:*




**SEW
      CAL LOGO, INC.**


(Exact
      name of Registrant as specified in charter)





Nevada
            46-0495298(State
                or other jurisdiction of
            (I.R.S.
                Employer I.D. No.)incorporation
                or organization)




207
      W.
      138th Street, Los Angeles, California 90061


(Address
      of principal executive offices) (Zip Code)




Issuer's
      telephone number, including area code: (310) 352-3300




Check
      whether the Issuer (1) has filed all reports required to be filed by section
      13
      or 15(d) of the Exchange Act during the past 12 months (or for such shorter
      period that the registrant was required to file such reports), and (2) has
      been
      subject to such filing requirements for the past 90 days. Yes x No o




State
      the
      number of shares outstanding of each of the Issuer's classes of common equity
      as
      of the latest practicable date: At February 29, 2008, there were 44,175,535
      shares of the registrant's Common Stock outstanding and 300,000 shares of Series
      A Preferred Stock outstanding.





**PART
        I**
  **ITEM
        1. FINANCIAL STATEMENTS**
  The
        financial statements included herein have been prepared by the Company, without
        audit, pursuant to the rules and regulations of the Securities and Exchange
        Commission. Certain information and footnote disclosures normally included
        in
        financial statements prepared in accordance with generally accepted accounting
        principles have been omitted. However, in the opinion of management, all
        adjustments (which include only normal recurring accruals) necessary to present
        fairly the financial position and results of operations for the periods
        presented have been made. The results for interim periods are not necessarily
        indicative of trends or of results to be expected for the full year. These
        financial statements should be read in conjunction with the financial statements
        and notes thereto included in the Company's most recent registration statement
        on Form SB-2 as amended.
  
  SEWC
  
  **SEW
          CAL LOGO, INC.**
 
 **BALANCE
          SHEETS**
 
 February 29,
                
                August 31,2008
                
                2007(Audited)**ASSETS**Current
                    AssetsCash
                    and cash equivalents
                
                $
                28,424
                
                $
                155,704Accounts
                    Receivable, net
                
                
                141,959
                
                
                141,361Inventory
                
                
                78,895
                
                
                96,875Security
                    Deposits
                
                
                2,200
                
                
                6,000Prepaid
                    Expenses
                
                
                6,000
                
                
                3,800Total
                    current assets
                
                
                257,478
                
                
                403,740Equipment
                    and machinery, net
                
                
                179,557
                
                
                217,266Other
                    assets
                
                
                -
                
                
                -Total
                    assets
                
                $
                437,035
                
                $
                621,006**LIABILITIES
                    AND STOCKHOLDERS' EQUITY**Current
                    liabilitiesAccounts
                    payable
                
                $
                82,004
                
                $
                53,317Note
                    Payable-shareholder
                
                
                353,884
                
                
                347,884Other
                    current liabilities
                
                
                399,552
                
                
                252,630Current
                    Poriton of Long Term Debt
                
                
                194,145
                
                
                227,659Total
                    current liabilities
                
                
                1,029,585
                
                
                881,490Long-term
                    liabilitiesNote
                    Payable-related party
                
                
                35,707
                
                
                46,019Convertible
                    Debentures
                
                
                2,330,480
                
                
                2,331,517Discount
                    on Convertible Debentures
                
                
                (646,899
                )
                
                (646,899
                )Equipment
                    Loans
                
                
                10,969
                
                
                11,851Total
                    liabilities
                
                
                2,759,842
                
                
                2,623,978Stockholders'
                    Equity (Deficit)Preferred
                    stock, authorized 300,000 shares, Par value $0.001, issued and
                    outstanding
                    at 11/30/07 and 8/31/07 is 300,000 respectively
                
                
                300
                
                
                300Common
                    stock, authorized 500,000,000 shares, $0.001 par value, issued
                    and
                    outstanding at 2/29/08 and 8/31/07 is 44,175,535 and 34,080,702
                    shares
                    respectively.
                
                
                44,176
                
                
                34,081Additional
                    Paid in Capital
                
                
                4,191,869
                
                
                4,154,977Stock
                    Subscribed
                
                
                -
                
                
                -Accumulated
                    Deficit
                
                
                (6,559,152
                )
                
                (6,192,330
                )Total
                    stockholders' equity (deficit)
                
                
                (2,322,807
                )
                
                (2,002,972
                )Total
                    liabilities and stockholders' equity
                
                $
                437,035
                
                $
                621,006
 
 The
          accompanying notes are an integral part of these statements
  
  **SEW
          CAL LOGO, INC.**
 
 **STATEMENTS
          OF OPERATIONS**
 **(Unaudited)**
 
 Six Months Ended
                
                Three Months EndedFebruary 29,
                
                February 28,
                
                February 29,
                
                February 28,2008
                
                2007
                
                2008
                
                2007Revenue:Sales
                    of Caps, Embroidery and Other
                
                $
                998,339
                
                $
                1,005,468
                
                $
                449,427
                
                $
                443,864Total
                    Revenue
                
                
                998,339
                
                
                1,005,468
                
                
                449,427
                
                
                443,864Cost
                    of Goods Sold
                
                
                957,810
                
                
                907,108
                
                
                466,907
                
                
                455,655Gross
                    profit
                
                
                40,529
                
                
                98,360
                
                
                (17,480
                )
                
                (11,791
                )Expenses:General
                    and Administrative
                
                
                122,681
                
                
                163,678
                
                
                58,583
                
                
                61,232Officer
                    and Administrative Compensation
                
                
                91,908
                
                
                201,266
                
                
                31,308
                
                
                94,423Consulting,
                    Legal and Accounting
                
                
                127,798
                
                
                107,469
                
                
                59,667
                
                
                52,597Depreciation
                
                
                3,118
                
                
                41,784
                
                
                1,559
                
                
                20,892Rent
                
                
                24,000
                
                
                140,000
                
                
                12,000
                
                
                60,000Total
                    expenses
                
                
                369,505
                
                
                654,197
                
                
                163,117
                
                
                289,144Loss
                    from Operations
                
                
                (328,976
                )
                
                (555,837
                )
                
                (180,597
                )
                
                (300,935
                )Other
                    Income (Expenses)Interest
                    (Expense)
                
                
                37,846
                
                
                58,509
                
                
                17,268
                
                
                18,160Total
                    other expenses
                
                
                37,846
                
                
                58,509
                
                
                17,268
                
                
                18,160Loss
                    before income taxes
                
                
                (366,822
                )
                
                (614,346
                )
                
                (197,865
                )
                
                (319,095
                )Provision
                    for income taxes
                
                
                -
                
                
                -
                
                
                -
                
                
                -Net
                    loss
                
                $
                (366,822
                )
                $
                (614,346
                )
                $
                (197,865
                )
                $
                (319,095
                )Basic
                    and Diluted Earnings (Loss) per Share
                
                $
                (0.01
                )
                $
                (0.05
                )
                $
                (0.01
                )
                $
                (0.03
                )Weighted
                    Average Number of Common Shares
                
                
                27,595,484
                
                
                12,030,707
                
                
                27,595,484
                
                
                12,030,707
 
 The
          accompanying notes are an integral part of these statements
  
  **SEW
          CAL LOGO, INC.**
 
 **STATEMENTS
          OF STOCKHOLDERS' EQUITY**
 (Unaudited)
 
 Additional
                
                
                
                
                
                TotalPreferred Stock
                
                Common Stock
                
                Paid in
                
                Stock
                
                Accumulated
                
                Stockholders'Shares
                
                Amount
                
                Shares
                
                Amount
                
                Capital
                
                Subscribed
                
                (Deficit)
                
                Equity**Balance,
                    August 31, 2005**
                
                
                234,800
                
                $
                235
                
                
                5,176,168
                
                $
                5,176
                
                $
                187,517
                
                $
                36,000
                
                $
                (673,814
                )
                $
                (444,886
                )Shares
                    issued for Services at $0.15 per share
                
                
                
                
                
                
                
                
                50,000
                
                
                50
                
                
                7,450
                
                
                
                
                
                
                
                
                7,500Fair
                    Value of Warrants attached to Convertible Debentures
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                1,081,657
                
                
                
                
                
                
                
                
                1,081,657Beneficial
                    Conversion Feature attached to Convertible Debentures
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                2,500,000
                
                
                
                
                
                
                
                
                2,500,000Shares
                    issued for Services at $0.10 per share
                
                
                
                
                
                
                
                
                33,334
                
                
                33
                
                
                3,300
                
                
                
                
                
                
                
                
                3,333Shares
                    issued for Conversion of Debt
                
                
                
                
                
                
                
                
                290,000
                
                
                290
                
                
                32,741
                
                
                
                
                
                
                
                
                33,031Net
                    Loss for Year
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                (2,947,833
                )
                
                (2,947,833
                )**Balance,
                    August 31, 2006**
                
                
                234,800
                
                
                235
                
                
                5,549,502
                
                
                5,549
                
                
                3,812,665
                
                
                36,000
                
                
                (3,621,647
                )
                
                232,802Preferred
                    Shares issued for Services
                
                
                65,200
                
                
                65
                
                
                
                
                
                
                
                
                1,891
                
                
                
                
                
                
                
                
                1,956Common
                    Stock Issued for Cash
                
                
                
                
                
                
                
                
                61,000
                
                
                61
                
                
                60,939
                
                
                (36,000
                )
                
                
                
                
                25,000Shares
                    issued for Services
                
                
                
                
                
                
                
                
                3,500,200
                
                
                3,501
                
                
                214,000
                
                
                
                
                
                
                
                
                217,501Shares
                    issued for Conversion of Debt
                
                
                
                
                
                
                
                
                24,970,000
                
                
                24,970
                
                
                65,482
                
                
                
                
                
                
                
                
                90,452Net
                    Income (Loss) for period
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                (2,570,683
                )
                
                (2,570,683
                )**Balance,
                    August 31, 2007**
                
                
                300,000
                
                
                300
                
                
                34,080,702
                
                
                34,081
                
                
                4,154,977
                
                
                -
                
                
                (6,192,330
                )
                
                (2,002,972
                )Shares
                    issued for Services
                
                
                
                
                
                
                
                
                9,150,000
                
                
                9,150
                
                
                36,600
                
                
                
                
                
                
                
                
                45,750Shares
                    issued for Conversion of Debt
                
                
                
                
                
                
                
                
                744,833
                
                
                745
                
                
                292
                
                
                
                
                
                
                
                
                1,037Shares
                    issued for Conversion of Debt
                
                
                
                
                
                
                
                
                200,000
                
                
                200
                
                
                -
                
                
                
                
                
                
                
                
                200Net
                    Income (Loss) for period
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                
                (366,822
                )
                
                (366,822
                )**Balance,
                    February 29, 2008**
                
                
                300,000
                
                
                300
                
                
                44,175,535
                
                
                44,176
                
                
                4,191,869
                
                
                -
                
                
                (6,559,152
                )
                
                (2,322,807
                )
 
 The
          accompanying notes are an integral part of these statements
  
  **SEW
          CAL LOGO, INC.**
 
 **STATEMENTS
          OF CASH FLOWS**
 (Unaudited)
 
 Six Months Ended
                
                Three Months EndedFebruary 29,
                
                February 28,
                
                February 29,
                
                February 28,2008
                
                2007
                
                2008
                
                2007Operating
                    Activities:Net
                    income (loss)
                
                $
                (366,822
                )
                $
                (614,346
                )
                $
                (197,865
                )
                $
                (329,864
                )Adjustments
                    to reconcile net income (loss)Depreciation
                
                
                3,118
                
                
                41,784
                
                
                3,118
                
                
                20,893Stock
                    issued for services
                
                
                45,950
                
                
                19,835
                
                
                200
                
                
                -Warrants
                    issued for convertible debt
                
                
                -
                
                
                68,898
                
                
                -
                
                
                -Amortization
                    of Discount on Debentures
                
                
                -
                
                
                21,538
                
                
                -
                
                
                -Changes
                    in Assets and Liabilities(Increase)
                    decrease in prepaid expenses
                
                
                (2,200
                )
                
                (9,890
                )
                
                (2,200
                )
                
                (6,593
                )(Increase)
                    decrease in inventory
                
                
                17,980
                
                
                693
                
                
                3,230
                
                
                3,403(Increase)
                    decrease in security deposits
                
                
                3,800
                
                
                -
                
                
                3,800
                
                
                -(Increase)
                    decrease in accounts receivable
                
                
                (598
                )
                
                101,645
                
                
                48,964
                
                
                75,535Increase
                    (decrease) in accounts payable
                
                
                28,687
                
                
                (118
                )
                
                51,717
                
                
                20,502Increase
                    (decrease) in other current liabilities
                
                
                113,408
                
                
                66,379
                
                
                73,497
                
                
                130,310Net
                    cash provided by (used in) operating activities
                
                
                (156,677
                )
                
                (303,582
                )
                
                (15,539
                )
                
                (85,814
                )Investing
                    Activities:(Purchases)
                    disposal of equipment
                
                
                34,591
                
                
                (15,000
                )
                
                15,737
                
                
                -Cash
                    (used) in investing activities
                
                
                34,591
                
                
                (15,000
                )
                
                15,737
                
                
                -Financing
                    Activities:Notes
                    Payable
                
                
                
                
                
                (48,291
                )
                
                
                
                
                -Debentures
                    Payable
                
                
                6,000
                
                
                (68,898
                )
                
                6,000
                
                
                -Stock
                    Subscription
                
                
                -
                
                
                -
                
                
                -
                
                
                -Stock
                    Sales
                
                
                -
                
                
                25,000
                
                
                -
                
                
                -Increase/(Decrease)
                    in shareholder loan
                
                
                -
                
                
                -
                
                
                -
                
                
                -Repayment
                    of loans
                
                
                (10,312
                )
                
                (4,674
                )
                
                (5,188
                )
                
                4,734Proceeds
                    from equipment loan
                
                
                (882
                )
                
                -
                
                
                (882
                )
                
                (2,459
                )Net
                    cash provided by (used in) financing activities
                
                
                (5,194
                )
                
                (96,863
                )
                
                (70
                )
                
                2,275Net
                    increase (decrease) in cash and cash equivalents
                
                
                (127,280
                )
                
                (415,445
                )
                
                128
                
                
                (83,539
                )Cash
                    and cash equivalents at beginning of the period
                
                
                155,704
                
                
                988,251
                
                
                28,296
                
                
                656,345Cash
                    and cash equivalents at end of the period
                
                $
                28,424
                
                $
                572,806
                
                $
                28,424
                
                $
                572,806Cash
                    Paid For:Interest
                
                $
                37,846
                
                $
                58,509
                
                $
                37,846
                
                $
                58,509Taxes
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -Non
                    Cash Activities:Depreciation
                
                $
                3,118
                
                $
                41,784
                
                $
                3,118
                
                $
                20,893Stock
                    issued for services
                
                $
                45,950
                
                $
                19,835
                
                $
                200
                
                $
                -Warrants
                    issued for convertible debt
                
                $
                -
                
                $
                68,898
                
                $
                -
                
                $
                -Amortization
                    of Discount on Debentures
                
                $
                -
                
                $
                21,538
                
                $
                -
                
                $
                -
 
 The
          accompanying notes are an integral part of these statements
  **SEW
        CAL LOGO, INC.**
 **NOTES
        TO UNAUDITED FINANCIAL STATEMENTS**
 **(February
        29, 2008 and August 31, 2007)**
 
 **NOTE
        1. Summary of Significant Accounting Policies**
 
 **The
        Company**
 
 C
        J
        Industries was incorporated in the State of California on August 30, 1985
        and
        changed its name to Southern California Logo, Inc (the Company). The Company
        transacts business as Sew Cal Logo.
 
 On
        February 24, 2004 the Company merged with Calvert Corporation, a Nevada
        Corporation. This was a recapitalization accounted for as a stock exchange
        transaction (reverse merger). Calvert also changed its name to Sew Cal Logo,
        Inc. See Note 9 for more details of this merger.
 
 The
        Company is located in Los Angeles, California. The Company produces and
        manufactures custom embroidered caps, sportswear and related corporate
        identification apparel. The Company provides an in-house, full-service custom
        design center where original artwork and logo reproduction for embroidery
        are
        available. The Company also offers contract embroidery and silk-screening
        to the
        manufacturing and promotional industry. The Company’s products are sold,
        primarily in the United States, to Fortune 500 companies, major motion picture
        and television studios, retailers, and local schools and small businesses.
 
 **Use
        of Estimates**
 
 The
        financial statements have been prepared in conformity with accounting principles
        generally accepted in the United States, which require management to make
        estimates, and assumptions that affect the reported amounts of assets and
        liabilities (including disclosure of contingent assets and liabilities) at
        the
        date of the financial statements and the reported amounts of revenues and
        expenses during the reporting period. Actual results could differ from those
        estimates.
 
 **Accounts
        Receivable**
 
 The
        Company’s trade accounts receivable and allowance for doubtful accounts are
        shown below.
 
 2/29/08
              
              8/31/07Gross
                  Trade Accounts Receivable
              
              $
              143,393
              
              $
              142,798Allowance
                  for Doubtful Accounts
              
              
              (1,434
              )
              
              (1,428
              )Accounts
                  Receivable, net
              
              $
              141,959
              
              $
              141,361
 
 **Revenue
        Recognition**
 
 The
        Company recognizes revenue from product sales upon shipment, which is the
        point
        in time when risk of loss is transferred to the customer, net of estimated
        returns and allowances.
 
 **Cash
        and Cash equivalents**
 
 The
        Company maintains cash deposits in banks and in financial institutions located
        in southern California. Deposits in banks are insured up to $100,000 by the
        Federal Deposit Insurance Corporation (“FDIC”). The Company has not experienced
        any losses in such accounts and believes it is not exposed to any significant
        credit risk on cash deposits.
 
 **Inventory**
 
 Inventory
        is stated at the lower of cost (first-in, first-out method) or market and
        consists of raw material, work-in-process and finished goods. Normally the
        Company ships out to the customer the finished goods as soon as they are
        produced and therefore usually does not maintain a finished goods inventory.
        Overhead items are applied on a standard cost basis to work in process and
        finished goods.
  
 
 2/29/08
              
              8/31/07Raw
                  Materials and WIP
              
              $
              78,895
              
              $
              96,875Finished
                  Goods
              
              
              -
              
              
              -Total
                  Inventory
              
              $
              78,895
              
              $
              96,875
 
 **Equipment
        and Machinery**
 
 Equipment
        and machinery are stated at cost. Depreciation is computed using the
        straight-line method over their estimated useful lives ranging from five
        to
        seven years. Depreciation and amortization expense for the fiscal years ended
        August 31, 2007 and 2006 amounted to $79,493 and $81,430 respectively. Gains
        from losses on sales and disposals are included in the statements of operations.
        Maintenance and repairs are charged to expense as incurred. As of February
        29,
        2008 and August 31, 2007 equipment and machinery consisted of the
        following:
 
 2/29/08
              
              8/31/07Equipment
                  and Machinery
              
              $
              942,890
              
              $
              968,644Less:Accumulated
                  depreciation
              
              
              (763,333
              )
              
              (678,586
              )$
              179,557
              
              $
              290,058
 
 **Fiscal
        Year**
 
 The
        Company operates on a fiscal year basis with a year ending August
        31.
 
 **Earnings
        and Loss Per Share Information**
 
 Basic
        net
        earnings (loss) per common share is computed by dividing net earnings (loss)
        applicable to common shareholders by the weighted-average number of common
        shares outstanding during the period.
 
 **Segment
        Reporting**
 
 Pursuant
        to Statement of Financial Accounting Standards No. 131 (“SFAS No. 131”),
“Disclosure about Segments of an Enterprise and Related Information,” the
        Company has determined it operated in only one segment.
  **NOTE
        2. Going Concern**
 
 The
        accompanying financial statements have been prepared assuming that the Company
        will continue as a going concern, which contemplates the realization of assets
        and the liquidation of liabilities in the normal course of business. However,
        the Company has accumulated a loss $6,361,287 during its years of operation.
        This raises substantial doubt about the Company’s ability to continue as a going
        concern. The financial statements do not include any adjustments that might
        result from this uncertainty.
 
 Managements
        Plan
 
 Management
        continues to seek funding from its shareholders and other qualified investors
        to
        pursue its business plan. It is in the process of expanding its sales and
        distribution capability.
  
  **NOTE
        3. Accounts Payable and Other Current Liabilities**
 
 As
        of the
        period ends shown, accounts payable and accrued liabilities consisted of
        the
        following:
 
 2/29/08
              
              8/31/07Trade
                  accounts payable
              
              $
              82,004
              
              $
              53,317Sales
                  tax payable
              
              $
              2,391
              
              $
              2,443Short
                  Term Loan – Related Party
              
              
              244,063
              
              
              86,600Payroll
                  Liabilities
              
              
              32,744
              
              
              31,389Credit
                  Card Debt
              
              
              22,284
              
              
              32,778Revolving
                  bank line of credit (Prime + 3.8 %, interest payable monthly),
                  Principal
                  due upon maturity on 7/1/07 unless renewed by bank, secured by
                  accounts
                  receivable
              
              
              98,070
              
              
              99,420-
              
              
              -$
              399,552
              
              $
              252,630
 
 **NOTE** **4.
        Note Payable- Related Party**
 
 On
        March
        1, 2003, for purposes of working capital, the sole shareholder and spouse
        made a
        $355,384 subordinated loan to the Company. The Company is obligated to pay
        monthly interest only on the subordinated loan during its term at the rate
        of
        10% per annum (fixed-rate calculated as simple interest). The entire principal
        amount of the loan was originally due on March 1, 2004, and has continued
        from
        that time on a month-to-month basis. The subordinated loan, which was consented
        to by United Commercial Bank and subsequent banks, is collateralized by the
        assets of the Company, including but not limited to any and all equipment
        owned
        by the Company, inventory, and outstanding receivables. The balance due at
        February 29, 2008 is $353,884.
 
 On
        April
        4, 2005 a shareholder loaned the company $100,000 on a five year monthly
        installment loan at 5% per annum for the purchase equipment. Balance of loan
        as
        of February 29, 2008 is $36,398.
 
 **NOTE
        5. Commitments and Contingencies**
 
 **Long-Term
        Debt**
 
 On
        March
        25, 2002 the Company entered into an agreement with United Commercial Bank
        for a
        $515,000 SBA loan. For the years ending August 31, 2003 and 2002, the unpaid
        principal balance of the loan was $462,100 and $500,313 respectively. The
        monthly required payment varied with an annual interest rate of 6.75% and
        a
        maturity date of March 1, 2012. This loan related to the purchase of
        equipment.
 
 On
        August
        11, 2004 the Company refinanced this SBA loan with Pacific Liberty Bank.
        As of
        February 29, 2008 the balance was $194,444. Monthly payments are made the
        15 th of each
        month with interest at prime plus 2.5. Currently the interest rate is 9.5%.
        This
        loan is collateralized by the assets of the corporation and is in first place
        before the shareholder loan.
 
 On
        April
        16, 2003 the Company entered an installment sale contract with GMAC for the
        purchase of a vehicle. The total amount financed at signing was $40,754 that
        represents the total sale price. The agreement requires 60 monthly payments
        of
        approximately $679 beginning on May 16, 2003 and ending on April 16, 2008.
        This
        Loan has been paid off.
 
 The
        Company has a second installment loan with GMAC on a vehicle with a balance
        as
        of February 29, 2008 of $10,969.
 
 **Lease
        Commitments**
 
 The
        Company leases warehouse and office facilities under an operating lease
        requiring the Company to pay property taxes and utilities. In July 2004 this
        building was purchased by a related party (a corporation controlled by the
        officers) and the lease was re-written for 5 years. Lease expense is currently
        $12,500 per month.
 
 The
        lease
        obligation is shown below for the next five years.
  
 
 Year
                  1
              
              Year
                  2
              
              Year
                  3
              
              Year
                  4
              
              Year
                  5Office
                  /warehouse lease
              
              $
              150,000
              
              $
              150,000
              
              $
              150,000
              
              $
              150,000
              
              $
              150,000
 
 **Callable
        Convertible Debentures**
 
 On
        February 16, 2006 the Company executed an equity financing agreement wherein
        it
        will issue an aggregate of $2,000,000 callable convertible debentures in
        three
        segments. The Company has received a net of $1,955,000. The debentures are
        convertible to common stock at 45% below the lowest three intra-day trading
        price during the 20 trading days immediately preceding conversion.
 
 The
        Debentures also carry five-year warrants exercisable at $0.50 per share.
        The
        aggregate number of warrants to be issued is 2,142,855. The Company has recorded
        an expense of $585,343 for the fair value of the warrants. The value was
        determined using the Black-Scholes pricing model and assumes a 5 year maturity,
        a risk free interest rate of 4.85% and a volatility of 207%.
 
 The
        Company has recorded a discount on the convertible debentures of $2,000,000
        which represents the beneficial conversion feature. During the years ended
        August 31, 2007 and 2006 the Company converted $90,452 and $33,031 debt into
        stock, respectively. During the years ended August 31, 2007 and 2006 the
        Company
        expensed $983,485 and $565,752 of the recorded discount as interest expense,
        respectively. The Company will amortize the remaining discount over the
        remaining life of the debentures. The discount was determined using the
        Black-Scholes pricing model and assumes a 2 year maturity, a risk free interest
        rate of 4.85% and a volatility of 207%.
 
 On
        July
        31, 2006 the Company executed an equity financing agreement wherein it has
        issued $500,000 in callable convertible debentures and 20,000,000 seven year
        warrants exercisable at $0.05 per share. The debentures are convertible to
        common stock at 40% below the lowest three intra-day trading price during
        the 20
        trading days immediately preceding conversion. The aggregate number of shares
        to
        possibly be issued at 100% conversion is 69,444,444 shares. Calculated using
        a
        current 3 day trading average price per share of $0.012 per share less 40%
        is
        $0.0072 per share divided into $500,000 equals 69,444,444 shares.
 
 During
        the year ended August 31, 2006, the Company recorded an expense of $496,314
        for
        the fair value of the warrants. The value was determined using the Black-Scholes
        pricing model and assumes a 5 year maturity, a risk free interest rate of
        4.85%
        and a volatility of 207%.
 
 The
        Company recorded a discount on the convertible debentures of $500,000 which
        represents the beneficial conversion feature and is amortized to interest
        expense over the 2 year life of the debentures. The Company recorded an expense
        of $ 250,000 and $20,833 respectively for the years ended August 31, 2007
        and
        2006. The discount was determined using the Black-Scholes pricing model and
        assumes a 2 year maturity, a risk free interest rate of 4.85% and a volatility
        of 207%.
 
 **NOTE** **6.
        Stockholders’ Equity**
 
 Preferred
        Stock
 
 The
        Company (post merger) is authorized to issue three hundred thousand (300,000)
        shares of series A preferred stock at a par value of $0.001. The preferred
        stock
        is convertible to common stock at one share of preferred for every 100 shares
        of
        common. The preferred shares can only be converted when the Company reaches
        $10,000,000 in sales for any fiscal year. As of August 31, 2004 there were
        234,800 shares of preferred stock. The value was placed at par. The conversion
        to common stock would be 23,480,000 shares. Based upon the actual growth
        for the
        last two years, the $10,000,000 in sales will not be reached within five
        years.
        Therefore, these shares are not considered in calculating the loss per
        share.
 
 During
        the quarter ended May 31, 2007 the Company issued 65,200 preferred shares
        for
        services to key employees for services.
 
 Common
        Stock
 
 On
        August
        25, 2006 the Company’s authorization to issued common stock was increased from
        50,000,000 shares to 500,000,000 shares at par value of $0.001
  
  As
        of
        August 31, 2004 (post merger) the Company had 5,020,000 common shares issued
        and
        outstanding. The Company’s financial statements have been restated to reflect
        the recapitalization on a retroactive basis.
 
 In
        May
        2005 the Company purchased equipment valued at $114,100 for 33,334 common
        share
        and issued 122,834 common shares for services valued at $12,283.
 
 As
        of 31
        May 2005 the Company had received from investors $36,000 in investment funds
        for
        which restricted common shares will be issued. The exact number of shares
        has
        not yet been determined.
 
 On
        January 6, 2006 the Company issued 50,000 common shares for services valued
        at
        $7,500.
 
 On
        February 16, 2006 the Company entered into a securities purchase agreement
        for a
        total subscription amount of $2,000,000 that includes stock purchase warrants
        and callable convertible debentures. A discount on convertible debentures
        was
        recorded as additional paid in capital of $2,000,000 for the beneficial
        conversion feature which is being amortized over the life of the debentures.
        The
        total subscription includes an aggregate of 2,142,858 five-year warrants
        exercisable for the same number of common shares at $0.50 per share. An
        aggregate of 25,974,026 common shares have been registered and are available
        for
        issue to potentially convert the full $2,000,000.
 
 On
        July
        31, 2006 the Company issued $500,000 in convertible debentures which are
        convertible to shares of the Company’s common stock at a 40% discount to the
        market price at the time of conversion. A discount on convertible debentures
        was
        recorded as additional paid in capital of $500,000 for the beneficial conversion
        feature which is being amortized over the life of the debentures. Common
        stock
        registered to convert the full $500,000 was calculated at 69,444,444 shares
        using the current three day average price per share of $0.012 less a 40%
        discount.
 
 On
        May
        31, 2006 the Company issued 290,000 common shares by converting $33,031 of
        debenture debt and issued 33,334 common shares for consulting services valued
        at
        $3,333.
 
 The
        Company issued 61,000 common shares for cash of $25,000 and the subscription
        deposit of $36,000 received in May 2005 in a private placement.
 
 During
        the Year ended August 31, 2007 the Company issued 3,500,200 common shares
        for
        various services valued at $217,501 including 2,750,000 common shares in
        settlement of a finders fee dispute valued at $200,000. The Company converted
        $90,452 debenture debt by issuing 24,970,000 common shares.
 
 During
        the three months ended November 30, 2007 the Company issued 9,150,000 common
        shares for various services valued at $45,750. The Company converted $1,037
        debenture debt by issuing 744,833 common shares.
 
 During
        the three months ended February 29, 2008 the Company converted $200 debenture
        debt using 200,000 common shares.
 
 Warrants
 
 With
        the
        $1,955,000 worth of convertible debentures described above 2,000,000 five-year
        warrants for commons stock exercisable at $0.50 per share were issued and
        with
        the $500,000 convertible debentures 20,000,000 seven-year warrants for common
        shares exercisable at $0.05 per share were issued. Both exercisable prices
        are
“out of the money” therefore no discount has been recorded.
 
 **NOTE** **7.
        Interest Expense**
 
 Interest
        expense for the periods ended February 29, 2008 and August 31, 2007 is $37,846
        and $1,309,263 respectively.
  
  **NOTE
        8. Income Taxes**
 
 The
        Company provides for income taxes under Statement of Financial Accounting
        Standards No. 109, Accounting for Income Taxes. SFAS No. 109 requires the
        use of
        an asset and liability approach in accounting for income taxes. Deferred
        tax
        assets and liabilities are recorded based on the differences between the
        financial statement and tax bases of assets and liabilities and the tax rates
        in
        effect when these differences are expected to reverse.
 
 SFAS
        No.
        109 requires the reduction of deferred tax assets by a valuation allowance
        if,
        based on the weight of available evidence, it is more likely than not that
        some
        or all of the deferred tax assets will not be realized. In the Company’s
        opinion, it is uncertain whether they will generate sufficient taxable income
        in
        the future to fully utilize the net deferred tax asset. Accordingly, a valuation
        allowance equal to the deferred tax asset has been recorded. The total deferred
        tax asset is calculated by multiplying a 15% estimated tax rate by the items
        making up the deferred tax account. For the Company only the Net Operating
        Loss
        (NOL) was available for a tax asset.
 
 The
        provision for income taxes is comprised of the net changes in deferred taxes
        less the valuation account plus the current taxes payable.
 
 At
        August
        31, 2006, federal income tax net operating loss carry forwards (“NOL’s”) which
        were available to the Company were the following with the year in which they
        expire.
 
 Year
                  (8/31)
              
              Amount
              
              Expires1996
              
              $
              2,104
              
              
              20111997
              
              
              9,265
              
              
              20121998
              
              
              26,317
              
              
              20131999
              
              
              21,074
              
              
              20192000
              
              
              50,619
              
              
              20202001
              
              
              21,675
              
              
              20202002
              
              
              319,424
              
              
              20222003
              
              
              45,381
              
              
              20232005
              
              
              105,366
              
              
              20252006
              
              
              2,947,833
              
              
              20262007
              
              
              2,570,683
              
              
              2027Total
              
              $
              6,119,741
 
 Were
        the
        NOL tax asset to be recorded at 8/31/07 it would be a long-term asset of
        $917,961. Continued profitability by the Company will be a major factor in
        the
        valuation account being removed and the recording of this asset.
 
 **NOTE
        9. Merger with Calvert**
 
 On
        February 24, 2004 the Company merged with Calvert Corporation, an inactive
        Nevada Corporation. This was a recapitalization accounted for as a stock
        exchange reverse acquisition with Calvert being the surviving legal entity
        and
        Southern California becoming the surviving historical entity. Before the
        merger
        Southern California had 100 shares of common stock issued and outstanding
        that
        were owned by a single shareholder. As part of the merger Calvert issued
        to this
        shareholder 189,800 shares of series A preferred stock and 3,000,000 shares
        of
        common stock in exchange for all the shares (100) of Southern California.
        These
        share totals have been retroactively applied to previous years.
 
 As
        part
        of the merger 45,000 shares of preferred stock and 1,500,000 shares of common
        stock were issued for services rendered. A value of $1,545 was placed upon
        these
        shares.
 
 Calvert
        had a zero book value prior to the merger and is shown as the acquired company
        on the statement of stockholders’ equity with 520,000 shares outstanding prior
        to the merger.
 
 After
        the
        completion of the merger the Company had 5,020,000 shares of common stock
        and
        234,800 shares of series A preferred stock.
  
  **NOTE
        10.**  **THE EFFECT OF RECENTLY ISSUED ACCOUNTING STANDARDS**
 
 Below
        is
        a listing of the most recent Statement of Financial Accounting Standards
        (SFAS)
        SFAS 155-157 and their effect on the Company.
 
 **Statement
        No. 155 –** *Accounting
        for Certain Hybrid Financial Instruments*
  In
        February 2006, the FASB issued SFAS No. 155, *Accounting
        for Certain Hybrid Financial Instruments* ,
        which
        amends SFAS No. 133, *Accounting
        for Derivatives Instruments and Hedging Activities* and SFAS
        No. 140, *Accounting
        for Transfers and Servicing of Financial Assets and Extinguishment of
        Liabilities* .
        SFAS
        No. 155 amends SFAS No. 133 to narrow the scope exception for interest-only
        and
        principal-only strips on debt instruments to include only such strips
        representing rights to receive a specified portion of the contractual interest
        or principle cash flows. SFAS No. 155 also amends SFAS No. 140 to allow
        qualifying special-purpose entities to hold a passive derivative financial
        instrument pertaining to beneficial interests that itself is a derivative
        instrument.
  **Statement
        No. 156 –** *Accounting
        for Servicing of Financial Assets*
  In
        March
        2006, the FASB issued SFAS No. 156, *Accounting
        for Servicing of Financial Assets,* which
        provides an approach to simplify efforts to obtain hedge-like (offset)
        accounting. This Statement amends FASB Statement No. 140, *Accounting
        for Transfers and Servicing of Financial Assets and Extinguishments of
        Liabilities* ,
        with
        respect to the accounting for separately recognized servicing assets and
        servicing liabilities. The Statement (1) requires an entity to recognize
        a
        servicing asset or servicing liability each time it undertakes an obligation
        to
        service a financial asset by entering into a servicing contract in certain
        situations; (2) requires that a separately recognized servicing asset or
        servicing liability be initially measured at fair value, if practicable;
        (3)
        permits an entity to choose either the amortization method or the fair value
        method for subsequent measurement for each class of separately recognized
        servicing assets or servicing liabilities; (4) permits at initial adoption
        a
        one-time reclassification of available-for-sale securities to trading securities
        by an entity with recognized servicing rights, provided the securities
        reclassified offset the entity's exposure to changes in the fair value of
        the
        servicing assets or liabilities; and (5) requires separate presentation of
        servicing assets and servicing liabilities subsequently measured at fair
        value
        in the balance sheet and additional disclosures for all separately recognized
        servicing assets and servicing liabilities. SFAS No. 156 is effective for
        all
        separately recognized servicing assets and liabilities as of the beginning
        of an
        entity's fiscal year that begins after September 15, 2006, with earlier adoption
        permitted in certain circumstances. The Statement also describes the manner
        in
        which it should be initially applied.
  **Statement
        No. 157** – *Fair
        Value Measurements*
  In
        September 2006, the FASB issued SFAS No. 157, *Fair
        Value Measurements* ,
        to
        clarify how to measure fair value and to expand disclosures about fair value
        measurements. The expanded disclosures include the extent to which companies
        measure assets and liabilities at fair value, the information used to measure
        fair value, and the effect of fair value on earnings and is applicable whenever
        other standards require (or permit) assets and liabilities to be measured
        at
        fair value. SFAS 157 is effective for financial statements issued for fiscal
        years beginning after November 15, 2007 and interim periods within those
        fiscal
        years.
  **Statement
        No. 158 –** *Employers’
        Accounting for Defined Benefit Pension and Other Postretirement Plans—an
        amendment of FASB Statements No. 87, 88, 106, and 132(R)*
  In
        September 2006, the FASB issued SFAS No. 158, *Employers’
        Accounting for Defined Benefit Pension and Other Postretirement Plans—an
        amendment of FASB Statements No. 87, 88, 106, and 132(R).* To
        improve financial reporting by requiring an employer to recognize the overfunded
        or underfunded status of a defined benefit postretirement plan (other than
        a
        multiemployer plan) as an asset or liability in its statement of financial
        position and to recognize changes in that funded status in the year in which
        the
        changes occur through comprehensive income of a business entity or changes
        in
        unrestricted net assets of a not-for-profit organization. This Statement
        also
        improves financial reporting by requiring an employer to measure the funded
        status of a plan as of the date of its year-end statement of financial position,
        with limited exceptions.
  
  **Statement
        No. 159 –** *The
        Fair Value Option for Financial Assets and Financial Liabilities—Including an
        amendment of FASB Statement No. 115*
  In
        February 2007, the FASB issued SFAS No. 159, *The
        Fair Value Option for Financial Assets and Financial Liabilities—Including an
        amendment of FASB Statement No. 115.* This
        Statement permits entities to choose to measure many financial instruments
        and
        certain other items at fair value. The objective is to improve financial
        reporting by providing entities with the opportunity to mitigate volatility
        in
        reported earnings caused by measuring related assets and liabilities differently
        without having to apply complex hedge accounting provisions. This Statement
        is
        expected to expand the use of fair value measurement, which is consistent
        with
        the Board’s long-term measurement objectives for accounting for financial
        instruments.
  **Statement
        No. 141 (revised 2007) –** *Business
        Combinations*
  In
        December 2007, the FASB revised SFAS No. 141, *Business
        Combinations.* This
        revision changes the way the minority interest in a company is measured,
        recorded and reported in the parent companies financial statements to the
        end
        that a statement user can better evaluate the nature and financial effects
        of
        the business combination.
  **Statement
        No. 160 –** *Noncontrolling
        Interests in Consolidated Financial Statements—an amendment of ARB No.
        51*
  In
        December 2007, the FASB issued SFAS No. 160, *Noncontrolling
        Interests in Consolidated Financial Statements—an amendment of ARB No. 51.* A
        noncontrolling interest, sometimes called a minority interest, is the portion
        of
        equity in a subsidiary not attributable, directly or indirectly, to a parent.
        The objective of this Statement is to improve the relevance, comparability,
        and
        transparency of the financial information that a reporting entity provides
        in
        its consolidated financial statements related to the noncontrolling or minority
        interest.
  The
        adoption of these new Statements is not expected to have a material effect
        on
        the Company’s current financial position, results or operations, or cash flows.
  **NOTE
        11.**  **Restated Financial Statements**
  The
        Company’s financial statements for the year ended August 31, 2006 have been
        restated to reflect the beneficial conversion feature and the warrants attached
        to the convertible debt issued during 2006. A summary of the effect of the
        restatements is as follows:
  **Balance
        Sheet:**
  Discount
                  on Convertible DebenturesOriginal
              
              $
              485,014As
                  Restated
              
              
              1,880,384Additional
                  Paid in CapitalOriginal
              
              $
              746,008As
                  Restated
              
              
              3,812,665Accumulated
                  DeficitOriginal
              
              $
              1,950,360As
                  Restated
              
              
              3,621,647**Statement
                  of Operations**:Warrant
                  ExpenseOriginal
              
              $
              -As
                  Restated
              
              
              1,081,657Interest
                  ExpenseOriginal
              
              $
              126,810As
                  restated
              
              
              716,440
  
  **ITEM
        2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONTINUING AND FUTURE PLAN OF
        OPERATIONS.**
  
  **FORWARD
        LOOKING STATEMENTS**
 
 This
        analysis should be read in conjunction with the condensed consolidated financial
        statements, the notes thereto, and the financial statements and notes thereto
        included in the Company's Registration Statement on Form SB-2, as amended,
        initially filed on March 20, 2004. All non-historical information contained
        in
        this annual report is a forward-looking statement. The forward-looking
        statements contained herein are subject to certain risks and uncertainties
        that
        could cause the actual results to differ materially from those reflected
        in the
        forward-looking statements.
  **Results
        of Operations**
 
 Total
        revenue was $449,427for the quarter ended February 29, 2008 as compared to
        $443,864 for the quarter ended February 28, 2007, a net increase of $5,563.
        The
        net increase is a result of our effort to replace what has become non-profitable
        business with profitable activities. Also, overall losses as a percentage
        of
        sales were cut by approximately 38%, reversing a negative trend. This can
        be
        attributed directly to both internal restructuring and to our significant
        investment in the research and development of our new brand based on the
        Pipeline Posse. Our line of clothing is continuing to be developed and
        advertising and promotional campaigns are initiated and underway. Officer
        and
        Administrative Compensation was $31,308 for the quarter ended February 29,
        2008
        as compared to $94,423 for the quarter ended February 28, 2008, a net decrease
        of $63,115. The net decrease is due to restructuring and streamlining management
        responsibilities to help facilitate future company direction and resulting
        profitability. Total Assets were $437,035 at February 29, 2008as compared
        to
        $621,006 at February 28, 2007, a net decrease of $183,791. The net decrease
        was
        primarily due to cash used for development expenses and reduction of inventory.
  **Plan
        of Operation**
  We
        continue promoting and marketing the Pipeline Posse product line, a recognized
        name in the world of surf and action sports. Our intent remains the
        manufacturing, selling and distributing of our own lines of surf wear and
        to
        promote this and other lines of goods in appropriate trade journals and other
        media as they are developed, expanded and distributed. Our first full length
        movie (surf video) – “Pipeline Posse – Project One” is now for sale in surf
        shops nationwide as well as available on the website: pipelineposse.com.
        Ads
        have been placed in major surf publications as well as on selected internet
        websites and the video trailers are available for viewing in our website
        video
        section. Private label business is beginning to return in spite of the
        continuing competition with aggressively marketed inexpensive overseas
        manufacturing. We continue to advocate the value of “Made in the USA” products
        and this is having some effect on new business as well as the return of previous
        customers. Our unique ability to respond to client needs for fast delivery
        also
        adds to our value as a domestic producer of quality goods. Should we be able
        to
        perpetuate and expand this trend we will add to our existing staff to support
        expansion and growth of both our private label business and entertainment
        business now that the writer’s strike has ended and remain cautiously optimistic
        on both issues.
 
 **Private
        Labeling**
 
 Domestic
        headwear suppliers have been drastically reduced as a result of increased
        lower
        pieced imports. Suppliers remaining in this business each have their own
        niche
        in the market place. Few remain in California and our customer base is
        increasing somewhat with this reduced competition. There are U.S. suppliers
        located in the Midwest and on the East Coast. They seldom manufacture for
        our
        market and deal mainly in the golf, major league baseball and ad specialty-type
        businesses.
 
 Overseas
        suppliers are a different situation. They can produce a cap at a fraction
        of the
        price we can and we are constantly in competition with them. They can copy
        all
        that we create, but if they are asked to create on their own, they may fall
        short, as our industry is constantly changing by way of fabrics, styles,
        and
        method of decorating. Overseas suppliers are in the business of mass production
        for export. Our current customers use overseas suppliers for some of their
        "bread and butter" styles but tend to use U.S. suppliers for the more cutting
        edge products. However, overseas manufacturers require considerably more
        time in
        creating new products because of their inability to provide face-to-face
        contact
        with designers and domestic customers. They also require greater lead times
        for
        shipping and cannot make changes overnight (literally) when required. The
        logistics also may not allow them to be immediately aware of developing trends,
        forecasting them, and then developing an appropriate finished product instantly.
  
  At
        present, the youth oriented "action sports" lifestyle-clothing market
        (surf/skate/snow) is led by labels such as "Quiksilver" of Huntington Beach,
        California, representing in excess of $1 billion in annual sales. Also, "O'Neill
        Sportswear", "Rip Curl", "Lost", "Billabong", "Volcom", and numerous other
        Orange County, California-based clothing companies service this market and
        can
        be considered competition for our new brands. We believe that teens and young
        adults are looking for something new and trendy to identify with, purchase,
        and
        wear.
 
 Although
        we believe we now have the experience and resources to take advantage of
        and
        fulfill the needs of this market and we have already made significant steps
        towards doing so, the youth, active and sports apparel industry is highly
        competitive, with many of our competitors having greater name recognition
        and
        resources than we do. Many of our competitors are well established, have
        longer-standing relationships with customers and suppliers, greater name
        recognition and greater financial, technical and marketing resources. As
        a
        result, these competitors may be able to respond more quickly and effectively
        than we can to new or changing opportunities or customer requirements. Existing
        or future competitors may develop or offer products that provide price, service,
        number or other advantages over those we intend to offer. If we fail to compete
        successfully against current or future competitors with respect to these
        or
        other factors, our business, financial condition, and results of operations
        may
        be materially and adversely affected.
 
 We
        currently have no market share data available for competition in these areas.
        We
        work on each job through personal contacts and are frequently the only company
        contacted for the particular project.
 
 We
        do not
        depend on any one or a few major customers.
 
 **Patents,
        Trademarks, Franchises, Concessions, Royalty Agreements, or Labor Contracts**
 
 We
        recently applied to the USTPO for the trademark “Pipeline Posse” in several
        categories. Each of our applications is active and currently under review
        for
        approval by the USPTO examiners We will continue to assess the need for any
        copyright, trademark or patent applications on an ongoing basis.
 
 **Film
        Wardrobe & Entertainment Related Business**
 
 Film
        wardrobe and related business remains slow as productions continue to be
        produced outside the United States. This holds true for nearly all of the
        major
        studios as well as independent filmmakers, causing the majority of the local
        costume houses to downsize.
 
 To
        counter this trend and help regain our lost dollar volume in this area we
        will
        continue our existing strategy of marketing directly to movie and television
        productions before they begin filming locally and send units out of town
        on
        location. Our strategy of dealing directly with producers, wardrobe personnel,
        and talent is beginning to pay off with recent orders from major films such
        as
“Superman Returns” and the recently released “American Gangster” starring Denzel
        Washington and Russell Crowe.
 
 **Corporate
        Sales**
 
 While
        corporate clients currently account for less than fifteen percent (15%) of
        our
        business, we continue to focus on growing this area of our business over the
        next year with the addition of in-house salespeople. Also, the addition of
        new
        silk screening equipment has given us the capability to accept and produce
        large
        orders of promotional t-shirts and related items for corporate programs through
        outside sales and advertising organizations. Our salespeople are now attempting
        to solicit business to our existing client base via telephone and Internet
        as
        well as to potential new customers through the same means as well as through
        print advertising via mailing and placement in trade publications. We are
        committed to making this new division profitable and more qualified labor
        has
        been retained to operate the new equipment as needed. Second and third
        manufacturing shifts can be added as growth requires. We have assigned two
        in-house clerical persons to service new inquiries and added accounts, as
        well
        as order finished goods for embellishment and shipping. Current production
        capacity is adequate to handle the anticipated increased volume. No other
        major
        capital expenditures are anticipated at this time.
 
 **Development
        of new Product Lines**
 
 We
        have
        identified and developed an opportunity to export the California life style
        to
        the rest of America and to the worldwide markets in general. Started as an
        idea
        born in San Clemente, California, home of the premier surfing beaches in
        the
        world, we have created a number of California Driven brands of products.
 Under
        the
        California Driven umbrella, several lines are being developed with specific
        target markets in mind. Currently, several California Driven products are
        being
        developed by us but they do not represent any significant amount of our current
        overall revenue. The California Driven brand lines are being developed as
        an
        expansion into our own line of products to market and sell.
  
  The
        first
        identified brand line is Pipeline PosseTM **.** Three
        trademarks have been applied for and are under active review for approval
        by the
        USPTO. **** We
        have
        completed initial design of a line of surf wear under the Pipeline PosseTM logo
        and have manufactured lifestyle oriented goods to begin a sales and marketing
        campaign. The exclusive rights for Pipeline PosseTM were acquired on August 15,
        2005 from Braden Dias of Hawaii. Mr. Dias is a world renowned surfer and
        is
        under agreement with us to represent Pipeline Posse as a professional athlete
        in
        the development of Surf and Sportswear lines. In addition to Mr. Dias, several
        additional professional Hawaiian surfers are currently under agreement to
        represent the project and 3 support people have been hired, both in Hawaii
        and
        California. Clothing design is being aggressively developed by both in-house
        personnel and professional independent contractors experienced in product
        development for the Action Sports Industry.
 
 Contact
        with our target market has been initially established in several major surf
        publications through personal interviews with our athletes as well as editorials
        on The Pipeline Posse itself. Print and on-line advertising campaigns have
        commenced in both industry related magazines and websites. We have also
        published and activated PIPELINEPOSSE.COM, our website which features up
        to date
        information on the athletes, activities, photo and video galleries, an active
        news blog, related action sports links, and a fully developed online store.
        The
        secure site and shopping capability has been recently activated to accept
        credit
        cards and offer shipment of merchandise worldwide. A multi- faceted major
        advertising and marketing campaign is being budgeted and developed for 2008
        and
        professional sales organizations are being interviewed and considered for
        representation and distribution of the brand both domestically and
        worldwide.
 
 Additional
        Action Sport related brands are being considered and are in various stages
        of
        development in regard to trademarks, competition, market potential, and strategy
        and cost. Target dates for launch have not been yet established.
  This
        Form
        10-QSB includes forward looking statements concerning the future operations
        of
        the Company. This statement is for the express purpose of availing the Company
        of the protections of such safe harbor with respect to all forward looking
        statements contained in this Form 10-QSB. We have used forward looking
        statements to discuss future plans and strategies of the Company. Management's
        ability to predict results or the effect of future plans is inherently
        uncertain. Factors that could affect results include, without limitation,
        competitive factors, general economic conditions, customer relations,
        relationships with vendors, the interest rate environment, governmental
        regulation and supervision, seasonality, distribution networks, product
        introductions, acceptance, technological change, changes in industry practices
        and one-time events. These factors should be considered when evaluating the
        forward looking statements and undue reliance should not be placed on such
        statements. Should any one or more of these risks or uncertainties materialize,
        or should any underlying assumptions prove incorrect, actual results may
        vary
        materially from those described herein.
  **Critical
        Accounting Policies**
  Sew
        Cal’s
        financial statements and related public financial information are based on
        the
        application of accounting principles generally accepted in the United States
        ("GAAP"). GAAP requires the use of estimates; assumptions, judgments and
        subjective interpretations of accounting principles that have an impact on
        the
        assets, liabilities, revenue and expense amounts reported. These estimates
        can
        also affect supplemental information contained in our external disclosures
        including information regarding contingencies, risk and financial condition.
        We
        believe our use if estimates and underlying accounting assumptions adhere
        to
        GAAP and are consistently and conservatively applied. We base our estimates
        on
        historical experience and on various other assumptions that we believe to
        be
        reasonable under the circumstances. Actual results may differ materially
        from
        these estimates under different assumptions or conditions. We continue to
        monitor significant estimates made during the preparation of our financial
        statements.
  Our
        significant accounting policies are summarized in Note 1 of our financial
        statements. While all these significant accounting policies impact its financial
        condition and results of operations, Sew Cal's views certain of these policies
        as critical. Policies determined to be critical are those policies that have
        the
        most significant impact on Sew Cal's consolidated financial statements and
        require management to use a greater degree of judgment and estimates. Actual
        results may differ from those estimates. Our management believes that given
        current facts and circumstances, it is unlikely that applying any other
        reasonable judgments or estimate methodologies would cause effect on our
        consolidated results of operations, financial position or liquidity for the
        periods presented in this report. During the next twelve months, we expect
        to
        take the following steps in connection with the further development of our
        business and the implementation of our plan of operations:
  
  **Item
        3. Controls and Procedures**
 
 Our
        management, under the supervision and with the participation of our Chief
        Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), has evaluated the
        effectiveness of our disclosure controls and procedures as defined in Securities
        and Exchange Commission (“SEC”) Rule 13a-15(e) and 15d-15(e) as of the end of
        the period covered by this report.  Based upon that evaluation,
        management  has concluded that our  disclosure  controls 
and  procedures  are  effective  to ensure  that
        information  we are required to disclose in reports that we file or submit
        under the Securities Exchange Act is communicated to management, including
        the
        CEO and CFO, as appropriate to allow timely decisions  regarding required
        disclosure and is  recorded,  processed,  summarized 
and  reported  within the time periods specified in the SEC’s rules
        and forms.
 There
        were no changes (including corrective actions with regard to significant
        deficiencies or material weaknesses) in our internal controls overfinancial
        reporting that occurred during the second quarter 2007-2008 that has materially
        affected, or is reasonably likely to materially affect, our internal control
        over financial reporting.
  **PART
        II - OTHER INFORMATION**
  **ITEM
        1. LEGAL PROCEEDINGS**
 
 Naranjo
        v. Sew Cal Logo Inc., California **** Case
        No.
        BC368353
 In
        March,
        2007 Mr. Naranjo filed a purported class action suit against Sew Cal asserting
        wages due and violations of various sections of the California Labor Code
        relating to his purported tenure with the company.  Sew Cal denies all
        allegations in the complaint and intends to defend the suit
        accordingly.
  **ITEM
        2. CHANGES IN SECURITIES**
  None
  **ITEM
        3. DEFAULTS UPON SENIOR SECURITIES**
  None.
  
  **ITEM
        4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**
 
 None.
  **ITEM
        5. OTHER INFORMATION**
  None
  
  **ITEM
        6. EXHIBITS AND REPORTS ON FORM 8-K**
  (a)
        EXHIBITS
 
 31.1
              
              Certification
                  of the Chief Executive Officer Pursuant to Section 302 of the
                  Sarbanes-Oxley Act31.2
              
              Certification
                  of the Chief Financial Officer Pursuant to Section 302 of the
                  Sarbanes-Oxley Act32.1
              
              Certification
                  of the Chief Executive Officer Pursuant to Section 906 of the
                  Sarbanes-Oxley Act32.2
              
              Certification
                  of the Chief Financial Officer Pursuant to Section 906 of the
                  Sarbanes-Oxley Act
  (b)
        REPORTS ON FORM 8-K
  None
  **SIGNATURES**
  Pursuant
        to the requirements of Section 13 or 15(d) of the Securities Exchange Act
        of
        1934, the Registrant has duly caused this report to be signed on its behalf
        by
        the undersigned, thereunto duly authorized.
 
 Date:
                  April 7, 2008
              
              By:
              /s/
                  Richard SongerRichard
                  SongerPresident,
                  Director and ChieExecutive
                  OfficerBy:
              /s/
                  Judy SongerJudy
                  SongerDirector
                  and ChiefFinancial
                  Officer