Specht v. Google Inc.

• Decision Date: 23 May 2014
• Docket Number: No. 11–3317.,11–3317.
• Citation: 747 F.3d 929
• Parties: Erich SPECHT, et al., Plaintiffs–Appellants, v. GOOGLE INC., Defendant–Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

747 F.3d 929

Erich SPECHT, et al., Plaintiffs–Appellants,

v.GOOGLE INC., Defendant–Appellee.

No. 11–3317.

United States Court of Appeals, Seventh Circuit.

Argued April 2, 2012.

Decided April 4, 2014.

Rehearing En Banc Denied May 23, 2014.

Martin J. Murphy, Attorney, Law Office of Martin J. Murphy, Chicago, IL, for Plaintiffs–Appellants.

Herbert H. Finn, Attorney, Greenberg Traurig, LLP, Chicago, IL, for Defendant–Appellee.

Before ROVNER, SYKES, and TINDER, Circuit Judges.

ROVNER, Circuit Judge.

During the dot-com boom of the 1990s, Erich Specht founded Android Data Corporation, and registered the “Android Data” trademark. The company ceased principal operations in 2002, but the Android Data mark remained registered to it. Five years later, Google Inc. rolled out its new Android operating system for mobile phones. Specht responded with this suit against Google, alleging primarily that, by releasing the Android operating system, Google had infringed on his Android Data mark. Google counterclaimed that Specht had abandoned the mark after 2002, forfeiting his ability to assert any rights to it. Because we agree with the district court that the undisputed evidence in the record establishes that Specht abandoned the mark, we affirm the district court's grant of summary judgment to Google.

Background

Inspired by the recent success of a number of technology start-ups, Erich Specht decided in 1998 to enter the business world himself. He designed a suite of e-commerce software and formed Android Data Corporation (ADC), through which he intended to license the software to clients. ADC also performed a number of other web-based services to clients, including website hosting and design, and computer consulting services. Two years later, Specht applied to register the trademark “Android Data” with the United States Patent and Trademark Office. The application was approved in 2002.

Despite the trademark's approval, by the end of 2002 ADC stopped major operations. That year, the company lost five clients, prompting Specht to lay off his only employee, cancel ADC's internet service contract, and move the business into his home. Signifying the end of ADC's life, he transferred all of ADC's assets, including its software and the registered “Android Data” mark, to another of his wholly-owned companies, The Android's Dungeon, Incorporated (ADI). Specht spent all of the next year unsuccessfully seeking a buyer for ADC's assets. As ADC was idle, he also shut off its phone line that year.

After 2002, Specht's business activities were limited. He continued to host ADC's website a while longer and conducted some hosting services for others. But he let the registration for the company's URL (androiddata.com) lapse in 2005, at which time he could no longer be reached at his associated email address. Specht passed out business cards in 2005 bearing the Android Data mark, but the record does not disclose how many, to whom, or why.

In 2007, about five years after he first began to wind down ADC's operations, Specht attempted to revive the use of the Android Data mark. First, to promote his software suite to catalog companies, Specht sent out a mass mailing in December 2007 with the Android Data mark. These mailings garnered no sales. Second, two months later, Specht attempted to license his software to a healthcare consulting firm, also to no avail. He made no other use of “Android Data” in 2007 or the next year. In April 2009, he used the mark once again when he resurrected his website, albeit with a slightly different URL (android-data.com) because his previous URL had by then been registered by a third party. He also assigned the Android Data mark to ADI, retroactive to the December 2002 asset transfer.

Meanwhile, during the years that Specht struggled with his shrinking business, another technology start-up calling itself “Android, Incorporated” began developing what would become known as the Android operating system for smart phones. Googlepurchased Android, Inc., in 2005. Two years after the purchase, Google released to the public a beta version of its Android software. This release, in November 2007, occurred about a month before Specht had attempted to revive his use of the Android Data mark in his mail mailing that December.

Google's beta release of Android in November 2007 allowed software developers to populate the marketplace for Android applications before the finished product appeared on a mobile phone. About a year after Android's beta release, under a license from Google, T–Mobile US, Inc., released the first publicly-available smartphone to run Android. Ever since Android's beta release, Google has continuously been using the Android mark. Google tried in November 2007 to register “Android” as its own trademark, but the Patent and Trademark Office denied that application and Google's subsequent appeal, citing the likelihood of confusion with Specht's Android Data mark.

Specht, ADC, and ADI sued Google, the founders of Android, Inc., and the Open Handset Alliance (an industry consortium created to foster innovation in mobile phone technology) over the use of the Android mark. The plaintiffs (whom we will, except where necessary, refer to simply as “Specht”) raise two claims under the Lanham Act: one for trademark infringement, see15 U.S.C. § 1114(1), and one for unfair competition, see id. § 1125(a). They also advance a claim for a violation of Illinois's Deceptive Trade Practices Act, see815 ILCS 510/2, and two claims for common-law trademark violations.

The district court dismissed all of the defendants except Google. No claim could be stated against Android, Inc.'s founders, the court explained, because as corporate officers they were not liable for Google's actions. The Open Handset Alliance was dismissed because it does not exist as a distinct legal entity. The district court also dismissed Specht and ADC as plaintiffs from the infringement claim; since Specht and ADC no longer owned the Android Data mark, the court ruled that only ADI had standing to assert infringement. Google answered the surviving allegations, raising two counterclaims relevant to this appeal. First, it sought a declaration that Specht had abandoned the mark, depriving him and his companies of any rights to it. (This claim also functions as an affirmative defense to Specht's Lanham Act claims.) Second, Google asked the district court to cancel the plaintiff's mark.

After Google moved for summary judgment, the parties locked horns over what evidence was properly before the court. Google challenged the admissibility of a slew of Specht's evidence. Relevant to this appeal, Google challenged Specht's attempts to submit screenshots from webpages of Specht's former clients from 2005, bearing the Android Data mark. The contested screenshots were from an internet archive service. The district court excluded these screenshots because, without an affidavit describing the reliability of the archive service, they were not properly authenticated. SeeFed.R.Evid. 901. Specht also brought evidentiary objections of his own. As relevant here, he objected to Google's screenshots of Specht's own website from August 2010 and to two of Google's press releases from November 2007 about the Android operating system. But the district court overruled both objections because Specht had submitted an identical screenshot and had alleged in his complaint the information from the press releases.

Evidentiary issues resolved, the district court addressed the merits. It found that Specht had abandoned the mark in 2002; the few times Specht used the Android Data mark after 2002 did not demonstrate continued use or intent to resume use of the mark. Because Specht therefore had forfeited any rights he might have to the mark, the district court ruled that all of Specht's claims failed as a matter of law. The district court also issued Google's requested declaration, and canceled Specht's registration.

Analysis

Before we proceed we must address appellate jurisdiction. Google filed a number of cross-claims that it later dismissed without prejudice, permitting it to reinstate those claims at some later point. Because these claims might be renewed, we ordinarily would dismiss this appeal for lack of finality as the litigation on those dismissed claims has not come to a conclusion in the district court. But at oral argument Google represented that it was willing to dismiss those claims with prejudice. Under authority such as JTC Petroleum Co. v. Piasa Motor Fuels, Inc., 190 F.3d 775, 776–77 (7th Cir.1999), and First Health Group Corp. v. BCE Emergis Corp., 269 F.3d 800, 801–02 (7th Cir.2001), Google's representation suffices to make the district court's entry of judgment appealable under 28 U.S.C. § 1291. Assured of our authority to resolve this appeal, we turn to the merits, first addressing two procedural rulings that preceded the decision on summary judgment.

Specht first attacks the district court's dismissal of him and ADC as plaintiffs in the trademark infringement claim, but the ruling was correct. The Lanham Act grants standing to trademark registrants, defining that term to include registrants and their “legal representatives, predecessors, successors, and assigns.” 15 U.S.C. § 1127. Specht argues that, because the definition of “registrant” in the Lanham Act is conjunctive, both the registrants (Specht and ADC) and the assignee (ADI) have standing to sue. But the Lanham Act transfers standing to assignees, even if that party is not the registrant, to ensure that only the current owner of the mark can claim infringement. See Gaia Techs., Inc. v. Reconversion Techs., Inc., 93 F.3d 774, 780 (Fed.Cir.1996); Gillette Co. v. Kempel, 45 C.C.P.A. 920, 254 F.2d 402, 404 (1958) (“the assignee of a registration stands in the place of the registrant in all respects”). Since that party is now ADI, only ADI has standing to claim that the Android Data mark has been infringed.

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