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I have never been fan of new hangout that replace the good old Gtalk. I miss the good ol Gtalk days.
Even worse the hangout chat history started coming in my inbox, here is how you can hide it

• Go to gmail Settings->Filters
• Create filter for “Has the words” section, add is:chats as the filter
• Click on create filter with this result, Select Skip Inbox (Archive), hit ok for both the warnings