Case ID: misc_34/html/0342-01.html
Source: Caselaw Access Project
Author: {"author": "Scott, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The Universal Talking Machine Company, Plaintiff, v. John C. English, Defendant.
    (Supreme Court, New York Special Term,
    March, 1901.)
    Equity — • Enjoining servant having special skill from performing similar services for another — Discoveries made during his employ- . ment.
    Equity may enjoin an employee, having special knowledge or skill not readily obtainable from anyone else and who refuses to render further services, from performing similar services for any person other than the employer, but will not interfere unless it is affirmatively shown by the employer that the employee has knowledge or skill which cannot easily be supplied by others.
    The rule that, where an employee has agreed to give his employer the benefit of any discoveries or inventions he may make while employed, equity will enjoin him from using them to the detriment of his employer, has no application where the employer fails to show specifically any discovery or invention made by the employee during the term of 'his employment.
    Motion to continue a temporary injunction.
    Olney & Comstock, for motion.
    J. E. Ludden, opposed.
   Scott, J.

The defendant’s contract with the plaintiff contained four several and severable obligations oh his part. First, to give his personal services and devote his skill and attention, for the period specified, to the exclusive service of the company in the matter of making sound records, and copies thereof, and in designing improved apparatus, and in developing and perfecting improved processes for recording and reproducing sound. Second, to vest in and assign to plaintiff all inventions and improvements in the art of sound recording and reproducing, or relating thereto, or capable of employment therein made by defendant since the 12th day of June, 1899, as well as those of such description made by him during the term of his employment by plaintiff. Third, to fully disclose to the authorized officials of the company any or all of the inventions' or improvements contemplated by the contract together with full descriptions, written or verbal or both, and all drawings, diagrams or formulae thereof and full directions for making, using and practicing the same. Fourth, not to disclose any of such inventions or discoveries (i. e., those made since June 12, 189‘9) to other than the duly authorized officials or attorneys of the plaintiff. The defendant has refused to complete this contract. He offers various reasons in justification of his refusal, with which it is not necessary to deal upon this motion. For the purpose of passing upon the question now presented it may be assumed, without deciding, that the defendant has no justification for his refusal to go on and complete his contract according to its terms. When so much is assumed, however, it does not necessarily follow that the plaintiff is entitled to relief in equity, for in general the remedy for a breach of contract is to be found in an action for damages. There are cases, however, in which equity will intervene and afford injunctive relief. One of these cases is correctly stated in the plaintiff’s brief by a quotation from a well-known text-book, as follows: “ When one person agrees to render personal services to another which require and presuppose a special knowledge, skill and ability in the employee, so that in ease of a defaidt the same services could not easily be obtained from others, although the affirmative specific performance of the contract is beyond the power of the court, this performance will be negatively enforced by enjoining its breach.” Pom. Spec. Perf. (2d ed.), § 24.

In other words, in a case such as is supposed by the writer above quoted, while equity cannot compel the employee to devote his knowledge, skill and ability to his employer, it can forbid him to devote them to the service of any other, and a portion of the relief asked for by the plaintiff is that the defendant be enjoined from performing for any other, the services which he has agreed to perform for plaintiff. It will be observed that in order to apply this principle to any particular case the servant must be possessed of special knowledge, skill and ability, so that in case of his default the same service cannot easily be obtained from others. The plaintiff’s business, as stated in the complaint, is that of manufacturing records of sound, and selling apparatus containing sound records and which reproduce sound known as zonophones and gramophones. The sound records made by plaintiff are stated to be what are known as original or master records, being flat discs of a hard composition on which are pressed lateral vibrations, which are the sound waves. These vibrations or waves are produced upon the discs, by a needle, the movements of which are influenced by the sounds projected into a receiver, or horn.These originals are then reproduced by an electrotyping process, and. the electrotypes are used as a matrix or die for pressing duplicate discs. Defendant’s especial skill and knowledge seems to have been, first, that he knew the composition of the disc on which the master record was traced; and, second, he had acquired a certain skill in so placing the singer, orator or musician with reference to the receiver or horn into which the sound was to be projected, as to produce the best results, and his sole employment by the defendant was to produce these master records. So far as concerns the composition of which the disc is made it appears that he dictated the formula to an officer of the plaintiff at the time he signed the contract in question. So far as concerns the placing of the person producing the sound he swears that before he left plaintiff’s employ he fully and carefully instructed another" employee who still remains with the plaintiff. This employee denies that he was taught by defendant, but how he acquired his present skill is immaterial. The important fact is that notwithstanding defendant’s defection plaintiff is still able to produce master records, which the defendant swears, and plaintiff does not deny, are quite as good, if not a little better than those which defendant made. It does not appear, therefore, that the same service that defendant agreed to render, cannot readily be obtained from another, and' the application for an injunction upon this ground cannot prevail. The plaintiff relies, however, upon another equally well-established rule,- which has been stated as follows: Where a person is the owner of valuable trade secrets, which were either discovered by an employee, or necessarily disclosed to him while occupying a confidential relation towards the owner, and such employee has agreed to give his employer the exclusive property in and control over such inventions, and thereafter in violation of such agreement, undertakes to make use of the same in such manner as to materially injure his employer’s business, a court in equity' will grant relief and enjoin the employee from making use of said knowledge to the prejudice of his employer.” Eastman Kodak Co. v. Reichenbach, 79 Hun, 184; Little v. Gallus, 4 App. Div. 569. The defendant by his contract did agree that all inventions and discoveries made by him during the term of his employment should belong to plaintiff, and that he would not impart them to anyone else. It is not contended that plaintiff disclosed any trade secrets to defendant, and it is not made very clear that he himself discovered or invented anything during the period of his connection with plaintiff. The plaintiff alleges very generally that defendant made some inventions or discoveries in the direction of improving the process of making records, but gives no details thereof either by stating the nature of such inventions or discoveries, or their result or effect in improving the processes. The defendant says that he has not since he entered plaintiff’s employ, learned anything new in reference to making sound records and copies' thereof, or in designing improved processes for recording and producing sounds, and now knows no more on the subject, than when he first entered plaintiff’s employ, and he denies with emphasis that he has ever disclosed to anyone, save plaintiff’s officers and employees any processes, apparatus, inventions or improvements relating to the production of records, or that he has threatened to do so, or told anyone that he intended to do so. He states that he intends to go into business, but only in the manufacture and sale of pressed records which are not manufactured by plaintiff: The only obligation assumed by defendant as to inventions, discoveries and improvements, was that plaintiff should be entitled to such as defendant might make while in plaintiff’s employ, that is, after October 12, 1899, and that as to those he should make disclosure only to plaintiff’s officers or attorneys; As to anything that he had invented or discovered prior to October 12, 1899 he was left free to make such use as he saw fit. In view of plaintiff’s total failure to point out or designate any invention or discovery which it alleges that defendant has made since the date fixed by the nontract, coupled with defendant’s positive denial that there are any such, the plaintiff has not made out a case justifying the continuance of the injunction pendente lite under the rule of law secondly above stated.

The motion to continue the injunction must be denied, and the temporary injunction vacated, with ten dollars costs to defendant.

Motion denied and temporary injunction vacated, with ten dollars costs to defendant.