Legalese

Battle of the NYC Startups: GroupMe Sues Groupie to ‘Remove Cloud of Uncertainty’ Around Trademark

More "perceived deep pockets," more problems.
 Battle of the NYC Startups: GroupMe Sues Groupie to Remove Cloud of Uncertainty Around Trademark

No smiley face for Groupie.

Last week, GroupMe*, the popular group messaging app acquired by Skype in late Augustfiled a complaint in Southern District of New York against Groupie, another New York City-based startup. Their stated motive: to “remove the ‘cloud’ of uncertainty” around the GroupMe trademark.

In the filing, GroupMe stops just short of calling Groupie a trademark troll. Funny, we’re more accustomed to hearing about the patent kind.  

Groupie, which was founded in 2008, is also a group messaging app. However, Groupie is more narrowly focused around connecting users by interests and hobbies and only works on the iPhone. It does not appear to have raised any outside financing. Last year, Groupie claimed 60,000 users who sent more than 1 million in-app messages daily. GroupMe, on the other hand, which was founded in 2010 and works on multiple platforms, recently expanded in the events space. GroupMe also raised $11.5 million before its acquisition and, according to the court documents, currently has 4.6 million users who send an average of 550 million messages per month.

In May 2009, Groupie trademarked its name as a “computer application software for mobile phones,” and “challenged” GroupMe’s attempt to trademark “GroupMe” last year.

The new court documents, which were first picked up by The Next Web, allege that GroupMe’s “perceived ‘deep pockets’ and rapid success have caused it to become unfairly targeted and wrongfully accused of trademark infringement” by Groupie. The filing goes on to say that Groupie has “threatened” GroupMe with “infringement liability if it does not acquiesce to an outrageous payout, it has also initiated a media blitz against [GroupMe] through which it has contacted countless reporters and bloggers in the technology sector,” in order to get the press to write about Groupie challenging GroupMe over trademark infringement.

It’s been almost a year since we last heard of this dispute. In fact, early last August, before the Skype acquisition was announced, Groupie reached out to Betabeat over this alleged infringement. As we noted at the time, we had never heard of Groupie until they contacted us. Tech blogs like GigaOm and Business Insider also picked up the story and GigaOm’s post was syndicated to the New York Times. Oddly enough, however, there doesn’t appear to have been any coverage of the dispute since last August. Even then, it seemed to quickly fade from the public eye . . . until last week’s filing.

In the lawsuit, which was filed July 11th, GroupMe requested declarations from the court that there is “no likelihood of confusion” between the GroupMe mark and the Groupie mark. GroupMe is also seeking a declaration that it has not violated any trademark of Groupie’s.

The filing goes on to request that Groupie’s trademark registration be cancelled because it is “merely descriptive.” (Trademark rights are not granted to descriptive marks, only distinctive ones.)

Part of GroupMe’s argument rests on the fact that its rapid success has built “substantial recognition and goodwill,” as well as “significant property rights.” The suit in particular notes that “approximately 1000 articles have been written about [GroupMe] and its founders.”

Indeed, Betabeat has mentioned GroupMe’s success with the press in a profile of Brooke Hammerling, the founder of Brew Media Relations, GroupMe’s PR firm, which the company hired when it was still notably early-stage.

Through Brew PR, GroupMe declined to comment on the suit. Groupie has not responded to requests for updated figures on its user base and engaged, however, the startup drafted the following response for Betabeat with the help of its lawyers:

This newly filed action is just the latest volley in an ongoing trademark dispute rooted in the confusing similarities between Groupie’s pre-existing, validly registered trademark “Groupie” and the nearly identical Groupme name.  Groupie initially filed an Opposition Proceeding against Groupme before the Trademark Trial and Appeal Board in July of 2011 (Groupie LLC v. Groupme Inc., TTAB Opposition No. 91200478).  Groupie’s Opposition Proceeding seeks to protect its trademark by preventing Groupme from registering the confusingly similar “Groupme” mark.  Not only do “Groupie” and “Groupme” look and sound the same, the two companies’ products are virtually identical and are distributed through the same channels of commerce, thus causing ongoing consumer confusion.  Additionally, the evidence will show that Groupme’s claim for cancellation of Groupie’s valid trademark is a late pursued theory premised on the illogical conclusion that the trademarked brand “Groupie” is a generic term.  Groupie is confident that claim will be summarily rejected.  In short, Groupie has been vigorously fighting to protect its trademark in the Opposition Proceeding and will do the same in the newly filed action.

Something tells us this lawsuit won’t be getting 1,000 articles.

*Disclosure.

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