Hangingout, Inc. v. Google, Inc.

Filing 9

MOTION to Dismiss for Failure to State a Claim by Google, Inc.. (Attachments: # 1 Memo of Points and Authorities, # 2 Declaration of Margret M. Caruso, # 3 Exhibit 1 to Caruso Declaration)(Caruso, Margaret)Attorney Margaret M. Caruso added to party Google, Inc.(pty:dft) (kaj).

1 QUINN EMANUEL URQUHART & SULLIVAN, LLP

Margret M. Caruso (Bar No. 243473)
Cheryl A. Galvin (Bar No. 252262)
555 Twin Dolphin Drive, 5th Floor
3 Redwood Shores, California 94065-2139
Telephone: [phone]
4 Facsimile: [phone]
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5 Attorneys for Defendant Google Inc.
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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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13 HANGINOUT, INC,

Plaintiff,

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vs.

16 GOOGLE INC.,
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Defendant.

CASE NO. 13-CV-2811 JAH NLS
MEMORANDUM OF POINTS AND
AUTHORITIES IN SUPPORT OF
GOOGLE’S MOTION TO DISMISS
ORAL ARGUMENT REQUESTED
Date: March 3, 2014
Time: 2:30 p.m.
Courtroom 13B
Judge: Hon. John A. Houston

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Case No. 13-CV-2811 JAH NLS
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF GOOGLE’S MOTION TO DISMISS

TABLE OF CONTENTS

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Page

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4 INTRODUCTION ....................................................................................................... 1
5 BACKGROUND ......................................................................................................... 1
6 ARGUMENT ............................................................................................................... 2
7 I.

LEGAL STANDARD ....................................................................................... 2

8 II.

HANGINOUT’S § 1114 CLAIM (COUNT I) MUST BE DISMISSED ......... 3

9 III.

HANGINOUT’S § 1125 CLAIM (COUNT II) MUST BE DISMISSED........ 3

10 IV.

HANGINOUT’S STATUTORY AND COMMON LAW UNFAIR
COMPETITION CLAIMS (COUNT III) MUST BE DISMISSED................. 6

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A.

Hanginout Fails To Allege A Claim Under California Business
& Professions Code § 17200................................................................... 6

B.

Hanginout Fails To Allege A Claim of California Common Law
Unfair Competition. ................................................................................ 7

CONCLUSION ............................................................................................................ 7

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TABLE OF AUTHORITIES

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Page(s)

Cases

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4 Ashcroft v. Iqbal,
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6

556 U.S. 662 (2009) ................................................................................... 2, 3, 5, 6

Balistreri v. Pacifica Police Department,
901 F.2d 696 (9th Cir. 1990) .................................................................................. 2

7 Bell Atlantic Corp. v. Twombly,
8
9

550 U.S. 544 (2007) ....................................................................................... 2, 5, 6

Brookfield Communications, Inc. v. West Coast Entm't Corp.,
174 F.3d 1036 (9th Cir. 1999) ............................................................................ 2, 4

10 Department of Parks and Recreation for State of California v. Bazaar Del Mundo
11

Inc.,
448 F.3d 1118 (9th Cir. 2006) ................................................................................ 4

12 Entrepreneur Media, Inc. v. Smith,
13
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279 F.3d 1135 (9th Cir. 2002) ................................................................................ 6

Fractional Villas, Inc. v. Tahoe Clubhouse,
No. 08-cv-1396, 2009 WL.160932 (S.D. Cal. Jan. 22, 2009)................................ 6

15 FreecycleSunnyvale v. The Freecycle Network, Inc., No. C 06-00324 CW,
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2006 WL 2060431 (N.D. Cal. July 25, 2006) .................................................... 2, 4

Glow Industries, Inc. v. Lopez,
252 F. Supp. 2d 962 (C.D. Cal. 2002) ................................................................ 4, 5

18 Groupion, LLC v. Groupon, Inc.,
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20

859 F. Supp. 2d 1067 (N.D. Cal. 2012).................................................................. 7

International Jensen, Inc. v. Metrosound U.S.A., Inc.,
4 F.3d 819 (9th Cir. 1993) ...................................................................................... 4

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Statutes
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15 U.S.C. § 1114...................................................................................................... 1, 3
15 U.S.C. § 1125(a) ..................................................................................................... 3
Cal. Bus. Prof. Code § 17200 ...................................................................................... 6
Fed. R. Civ. P. 12(b)(6) ............................................................................................... 2

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1

INTRODUCTION

2

The complaint that Plaintiff Hanginout, Inc. (“Hanginout”) filed against

3 defendant Google Inc. (“Google”) on November 26, 2013 (the “Complaint”) fails to
4 state any claims for which relief can be granted.

Hanginout does not own, or

5 allege to own, a registered trademark and therefore cannot state a claim for
6 trademark infringement under 15 U.S.C. § 1114, Section 32 of the Lanham Act.
7 Hanginout’s additional claims for federal and state law unfair competition fail
8 because Hanginout does not plead any factual allegations sufficient to support that it
9 has a valid, protectable trademark or that it is the senior user.

Because Hanginout

10 fails to state a cognizable legal theory or sufficient facts to support any cognizable
11 legal theory, the Complaint must be dismissed in its entirety.
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BACKGROUND
According to Hanginout’s Complaint (Dkt. No. 1), it developed an interactive

14 video-response platform under the brand HANGINOUT.

(Compl. ¶ 11.)

15 Hanginout filed U.S. trademark applications for the HANGINOUT word mark and
16 the HANGINOUT design mark (“the HANGINOUT marks”) on July 12, 2012.
17 (Id. at ¶ 16.)

The applications are still pending. (Id. at ¶ 17.) The Complaint

18 does not allege that HANGINOUT is a viable protectable trademark, either because
19 it is inherently distinctive or because it has acquired secondary meaning.
20 it allege that Hanginout is the senior user of the mark.

Nor does

The Complaint does not

21 allege the date Hanginout first used the HANGINOUT marks in commerce or how
22 Hanginout “commercialized” its products, (Compl. ¶ 9), including whether
23 Hanginout has done any marketing or made any sales of its products bearing the
24 HANGINOUT marks, the volume of actual paying customers, or where the
25 customers are located.
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According to the Complaint, Defendant Google has developed a social media-

27 based video chat service called Hangouts that enables both one-on-one and group
28 video chats.

(Compl. ¶ 19.) Hangouts can be accessed on the Internet through

Case No. 13-CV-2811 JAH NLS
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1 Google+ websites, or through mobile applications for Android and IOS.

(Id.)

2 Google filed an application to register the mark HANGOUTS on April 26, 2013.
3 (Id. at ¶ 20.)

Hanginout alleges upon information and belief that Google “officially

4 launched” Hangouts on May 15, 2013 (Compl. ¶ 18), but does not allege when
5 Google first began using the HANGOUTS mark.
6 “aggressively market[s]” its Hangouts product.
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Hanginout alleges that Google
(Id. at ¶ 25.)1

ARGUMENT

8 I.

LEGAL STANDARD

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A complaint may be dismissed under Rule 12(b)(6) of the Federal Rules of

10 Civil Procedure “based on the lack of a cognizable legal theory or the absence of
11 sufficient facts alleged under a cognizable legal theory.”
12 Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990).

Balistreri v. Pacifica

“Factual allegations must be

13 enough to raise a right to relief above the speculative level.”

Bell Atlantic Corp. v.

14 Twombly, 550 U.S. 544, 555 (2007) (internal quotations and citation omitted).
15 Mere “labels and conclusions, and a formulaic recitation of the elements of a cause
16 of action will not do.”

Id. Rather, “[t]o survive a motion to dismiss, a complaint

17 must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that
18 is plausible on its face.’

. . . A claim has facial plausibility when the plaintiff

19 pleads factual content that allows the court to draw the reasonable inference that the
20 defendant is liable for the misconduct alleged.”

Ashcroft v. Iqbal, 556 U.S. 662,

21 678 (2009) (quoting Twombly, 550 U.S. at 556, 570).

A plaintiff must plead “more

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While these allegations are assumed true for purposes of this motion to
dismiss, and justify granting the motion, Google reserves the right to contest their
accuracy and completeness. For example, Google officially launched Hangouts on
June 28, 2011 (http://googleblog.blogspot.com/2011/06/introducing-google-projectreal-life.html)—almost a year before the date Hanginout’s claimed as its first use
date in its trademark applications (Compl. ¶ 16, Attachments A, B). But
determination of the parties’ respective dates of first use are not necessary to resolve
this motion.
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1 than an unadorned, the-defendant-unlawfully-harmed-me accusation.”

Iqbal, 556

2 U.S. at 678.
3 II.

HANGINOUT’S § 1114 CLAIM (COUNT I) MUST BE DISMISSED

4

The plain language of 15 U.S.C. § 1114(1)(a), Section 32(1) of the Lanham

5 Act, provides protection only for the “registrant” of a “registered mark” when a use
6 in commerce of an imitation of that “registered mark” is likely to cause confusion.
7 15 U.S.C. § 1114(1)(a):

(1) Any person who shall, without the consent of the
registrant—

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(a) use in commerce any reproduction, counterfeit,
copy, or colorable imitation of a registered mark in
connection with the sale, offering for sale, distribution, or
advertising of any goods or services on or in connection
with which such use is likely to cause confusion, or to
cause mistake, or to deceive . . . .

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13 Id. (emphasis added).
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Unlike Section 43(a) of the Lanham Act (15 U.S.C. § 1125(a)), which

15 provides protection for unregistered trademarks, “section 32 provides protection
16 only to registered marks.”

Brookfield Commc’ns, Inc. v. West Coast Entm’t Corp.,

17 174 F.3d 1036, 1046 n.8 (9th Cir. 1999); accord FreecycleSunnyvale v. The
18 Freecycle Network, Inc., No. C 06-00324 CW, 2006 WL 2060431, at **3-4 (N.D.
19 Cal. July 25, 2006) (dismissing claim under 15 U.S.C. § 1114 where mark was
20 unregistered but an application was pending, finding that “[o]n its face, §32(1) limits
21 standing to registrants.”).
22

Hanginout does not allege that it has a registered trademark—only that it has

23 “pending trademark applications” for the HANGINOUT marks.

(Compl. ¶ 17.)

24 Hanginout therefore has not stated a claim for which relief can be granted, and its
25 claim for trademark infringement under 15 U.S.C. § 1114 must be dismissed.
26 III.

HANGINOUT’S § 1125 CLAIM (COUNT II) MUST BE DISMISSED

27

The Complaint fails to allege elements necessary to state a claim for

28 trademark infringement under 15 U.S.C. § 1125(a) (Section 43(a) of the Lanham
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1 Act), which can provide protection for unregistered marks.

To state such a claim, a

2 plaintiff must allege that it has a valid, protectable trademark, for which it is the
3 senior user, and that the defendant is using a mark confusingly similar to the
4 plaintiff’s mark in commerce.

See, e.g., Brookfield, 174 F.3d at 1047. Hanginout

5 fails to do this.
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First, the Complaint does not allege that HANGINOUT is a valid and

7 protectable trademark.

Although Hanginout alleges it has pending trademark

8 applications, unregistered marks are not entitled to a presumption of validity.
9 Glow Industries, Inc. v. Lopez, 252 F. Supp. 2d 962, 976 (C.D. Cal. 2002)
10 (plaintiff’s pending trademark application not entitled to presumption of validity).
11 Therefore, a plaintiff must allege that its unregistered mark is either inherently
12 distinctive or has acquired secondary meaning.

E.g., Int’l Jensen, Inc. v.

13 Metrosound U.S.A., Inc., 4 F.3d 819, 823 (9th Cir. 1993).
14 dismissed because it fails to do so.

The Complaint must be

“[B]ecause inherent and acquired

15 distinctiveness are different legal theories that potentially involve different factual
16 bases, [the accused infringer] is entitled to notice of whether the Marks are alleged
17 to possess inherent distinctiveness.”

Freecycle, 2006 WL 2060431 at *6

18 (dismissing § 43(a)(1) claim and finding that counterclaimant had failed to allege
19 whether the marks had inherent or acquired distinctiveness).
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Second, the Complaint fails to allege facts sufficient to show that Hanginout

21 is the senior user of the mark.
22 commercial usage.

Seniority of use can only be established by

“[I]t is not enough to have invented the mark first or even to

23 have registered it first; the party claiming ownership must have been the first to
24 actually use the mark in the sale of goods or services.”

Dep’t of Parks and

25 Recreation for State of California v. Bazaar Del Mundo Inc., 448 F.3d 1118, 1125
26 (9th Cir. 2006) (citation omitted).

Thus, the senior user of an unregistered

27 trademark may assert trademark rights only where it has obtained “sufficient market
28 penetration in any particular geographic area to claim common law trademark rights
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1 as the senior user in that territory,” which is determined by examining information
2 including the trademark user’s “volume of sales and growth trends, the number of
3 persons buying the trademarked product in relation to the number of potential
4 purchasers, and the amount of advertising.”

Glow Industries, 252 F. Supp. at 983.

5 The Complaint fails to allege sufficient commercial use to establish seniority.

It

6 does not even allege when Hanginout first used the HANGINOUT mark in
7 commerce.2

Further, it fails to allege any facts from which it would be plausible to

8 conclude that Hanginout made any use in commerce of sufficient volume and
9 geographic scope to give it seniority over Google’s nationwide use of HANGOUTS.
10 Cf. Iqbal, 556 U.S. at 678 (requiring complaint to be “‘plausible on its face’”)
11 (quoting Twombly, 550 U.S. at 570).

Hanginout has not alleged that its product has

12 been marketed or sold in any specific geographic area for any continuous length of
13 time nor alleged any sales or advertising of its product.

Accordingly, the

14 Complaint’s factual content fails to “allow[] the court to draw the reasonable
15 inference that the defendant is liable for the misconduct alleged.”

Id. (citing

16 Twombly, 550 U.S. at 556).
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Attachments A and B to the Complaint, which Hanginout represents are the

20 trademark applications for the HANGINOUT marks, represent under oath the date
21 of first use of the marks is June 6, 2012.
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(Compl. ¶ 16, Attachments A, B.)
However, it is unclear whether that is accurate. The specimens that Hanginout
submitted to the USPTO contain a copyright date of 2013—and feature an image of
the iPhone 5S, which was not released until September 2013. (Declaration of
Margret M. Caruso (“Caruso Decl.”), ¶ 2, Ex. 1;
http://www.apple.com/pr/library/2013/09/16iPhone-5s-iPhone-5c-Arrive-on-FridaySeptember-20.html.) Thus, nothing on the face of the specimens, which are
incorporated in the Complaint by reference as part of Hanginout’s trademark
application, reflect that the HANGINOUT mark was used in commerce for the
services identified as early as July 2012. This calls into question not only the first
use date, but also the veracity of Hanginout’s representations to the USPTO.
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Third, Hanginout’s allegation of likelihood of confusion is factually deficient.

2 The Complaint only formulaically recites that “Google’s wrongful use of the
3 HANGINOUT marks constitutes trademark infringement of Hanginout’s
4 HANGINOUT marks, has caused significant confusion in the marketplace, and is
5 likely to cause both confusion and mistake, along with being likely to deceive
6 consumers.”

(Compl. ¶ 30.) But it alleges no facts that, if proven, would

7 “allow[] the court to draw the reasonable inference” that confusion is likely.
8 556 U.S. at 678 (citing Twombly, 550 U.S. at 556).

Iqbal,

This requires dismissal. See,

9 e.g., id.; Fractional Villas, Inc. v. Tahoe Clubhouse, No. 08-cv-1396, 2009
10 WL160932, at *4 (S.D. Cal. Jan. 22, 2009) (dismissing Lanham Act Section 43
11 claim where plaintiff failed “[b]eyond conclusory allegations” to plead “any specific
12 facts that show the unauthorized use of its intellectual property caused confusion,
13 induced mistake, or deceived as to the affiliation of defendant with plaintiff”).
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Because Hanginout has failed to plead the essential elements of validity of its

15 asserted trademark and senior use, and failed to plead sufficient factual allegations
16 to support those elements or likelihood of confusion, Hanginout’s trademark
17 infringement claim under Section 43(a) of the Lanham Act must be dismissed.
18 IV.

HANGINOUT’S STATUTORY AND COMMON LAW UNFAIR
COMPETITION CLAIMS (COUNT III) MUST BE DISMISSED

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A.
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Hanginout Fails To Allege A Claim Under California Business &
Professions Code § 17200.

Actions pursuant to California Business & Professions Code § 17200 are

22 “substantially congruent” to claims made under the Lanham Act and rise and fall
23 with those claims.
24 (9th Cir. 2002).

E.g., Entrepreneur Media, Inc. v. Smith, 279 F.3d 1135, 1153

Hanginout’s conclusory allegations in support of its § 17200 claim

25 provide no further factual information than what it pleads for its federal Lanham Act
26 claims.

(Compare Compl. ¶ 42 with ¶ 38.) Accordingly, its § 17200 claim fails

27 for the same reasons as its federal Lanham Act claims.
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B.

Hanginout Fails To Allege A Claim of California Common Law
Unfair Competition.

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“Under California law, unfair competition is limited to cases in which a party
passes off their goods as another.” Groupion, LLC v. Groupon, Inc., 859 F. Supp.
2d 1067, 1083 (N.D. Cal. 2012). Because Hanginout has not alleged that Google
has “passed off” its goods as those of Hanginout, the Complaint fails to state claim
for common law unfair competition. Id.
CONCLUSION

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For the foregoing reasons, Hanginout’s Complaint should be dismissed in its
entirety.

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DATED: January 10, 2014

Respectfully submitted,
/s/ Margret M. Caruso
Margret M. Caruso
Cheryl A. Galvin
QUINN EMANUEL URQUHART
& SULLIVAN, LLP
Attorneys for Defendant Google Inc.

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CERTIFICATE OF SERVICE

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I hereby certify that on January 10, 2014, I will cause to be filed the foregoing

3 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF
4 GOOGLE’S MOTION TO DISMISS with the Clerk of the Court using the
5 CM/ECF system, which will then send a notification of such filing to counsel for
6 Plaintiff Hanginout, Inc.
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8

QUINN EMANUEL URQUHART &
SULLIVAN, LLP

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By /s/ Margret M. Caruso
Margret M. Caruso
Attorneys for Defendant Google Inc.
[e-mail]

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