In November 2013, Hanginout, Inc. (“Hanginout”) filed a lawsuit against Google Inc. (“Google”) alleging, among other things, that Google had infringed on Hanginout’s HANGINOUT mark.
Hanginout, a Virginia based social media company, uses its HANGINOUT mark for its interactive video response platform, which enables its users to create, promote, and sell their own brands by engaging directly with potential customers via pre-recorded video messages and/or video profiles. Google alleged that by 2009, it had already developed its internal version of what would become its HANGOUTS product. Google made its HANGOUTS product accessible to the public as part of its Google+ platform in June 2011. Google’s HANGOUTS product allows users to engage in live interactions with other users, including instant messaging and real-time video-conferencing. Neither Hanginout’s HANGINOUT mark or Google’s HANGOUTS marks are registered trademarks, as both are still the subject of pending trademark applications with the U.S. Patent and Trademark Office (“USPTO”).
In its action before the U.S. District Court for the Southern District of California, Hanginout moved for a preliminary injunction in January 2014.
However, the district court stated that, establishing priority of use is not in and of itself sufficient to bestow common law trademark rights. To warrant a preliminary injunction, Hanginout must also establish sufficient market penetration in a specific geographic area.
In support of its argument that it had sufficient market penetration, Hanginout asserted:
- it had a Facebook profile by March 2011;
- by May 2011, over 200 consumers had registered for and used Version 1.0 of the HANGINOUT web based platform;
- from September 15, 2012 through December 23, 2013 the HANGINOUT smart phone application had 30,000 visits from California 15 consumers, 7,000 visits from New York consumers, 3,500 visits from Florida consumers, 2,700 visits from Michigan consumers, 2,600 visits from Texas consumers, and a ranging number of visits from consumers in the remaining states;
- nearly 8,000 individuals had registered for the HANGINOUT iTunes application by the filing of the preliminary injunction; and
- various celebrities and politicians have created HANGINOUT accounts and published content utilizing the HANGINOUT platform.
The court did not find this evidence persuasive and found that Hanginout’s failure to present any evidence as the actual location of its registered users or sales was dispositive. Further, the court stated that there was a dramatic decline in the overall number of views of the HANGINOUT application. Therefore, the court denied Hanginout’s motion, finding that Hanginout had not proven that it had enough of the requisite market penetration to enforce its common law trademark under the Lanham Act.
While the court ultimately denied Hanginout’s motion for a preliminary injunction, it did find that Hanginout was the senior user of the mark. There was dispute as to whether Google began use of HANGOUTS in June 2011 or whether use did not begin until May 2013; however, the court determined that that issue did not need to be resolved, because Hanginout began use of its HANGINOUT mark in commerce in or around May 2011, prior to both of Google’s alleged first use dates.