#### Julia A. Sweeting, Respondent, *v.*Iroquois China Company, Appellant.

Fourth Department,

January 6, 1909.

Sale — secret process — prior sale to other parties — failure of consideration.

Where the inventor of a secret process, having already sold the same to one party, sells to another an “ exclusive” use thereof, he cannot recover on notes given to secure the purchase price of the second sale, where the formulas sold were identical except as respects the use of a single well-known ingredient which in no way aSected the operation of the process.

Kruse, J., dissented, with memorandum.

Appeal by the defendant, the Iroquois China Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Onondaga on the 27th day of May, 1908, upon the verdict of a jury, and also from an order entered in said clerk’s office on the 29th day of May, 1908, denying the defendant’s motion for a new trial made upon the minutes.

*Lamont Stilwell,*for the appellant.

*Thomas Woods,*for the respondent.

*778Spring, J.:

On the 2d day of November, 1906, T. Delos Sweeting, the husband of the plaintiff, claimed to be the owner of certain processes or formulas valuable in the manufacture of chinaware., The defendant is a corporation engaged in the manufacture of such ware in the village of Solvay, near the city of Syracuse.

These parties on that day entered into a written contract whereby Sweeting transferred to the defendant the exclusive use of such secret formulas in consideration of the sum of $12,000, payable as follows: $1,000 in cash, $2,000 in two separate promissory notes of $1,000 each, and $9,000 out of the earnings of the business, as stipulated in the agreement. The transfer of the formulas was made and the note in suit is one of those given in compliance with the agreement. After its maturity it was sold to the plaintiff and this action is brought by her for its collection. The defense interposed is that the note was without consideration in that Mr. Sweeting did not own the process which he pretended to transfer; that he had disclosed the ingredients of the same and parted with his interest therein to one Sebring in 1902.

It is undisputed that Mr. Sweeting had transferred a secret process to Sebring in 1902 for the sum of $1,000. The formula was composed of the same ingredients as the process sold to the defendant and the relative proportions were identical, except in the formula assigned to the defendant there is the addition of 100 pounds of English ball clay.

The sole question submitted to the jury was whether the-presence of this ingredient was such a substantial addition to the preceding process as to make a new formula, and the jury have so found. All the experts, including Sweeting and Sebring, agree as to the effect that English ball clay has on the constituent parts composing the process. Its use was not new. When Sweeting sold to Sebring the application of this ball clay was talked over and Sebring concluded not to use it. The evidence leaves it somewhat uncertain as to whether it was actually transferred to Sebring as one of the elements of the process. In any event, it was not considered as an indispensable part of the composition.

. Each formula is composed of five other ingredients, and, as already stated, the proportions of the two are relatively the same. The point *779is, therefore, whether the addition of a substance well known and whose effect upon the other component parts of the process is not a secret constitutes a new formula.

I am convinced that the English ball clay made no substantial change, and that the process transferred to the defendant was in all its essential features the same as that transferred to Sebring.

I appreciate that witnesses testified that the presence of the English ball clay produced an appreciable effect upon the mixture and even varied the proportions of the ingredients. That may be true. Any article, however well known, might produce the same result. .The effect of the ball clay, however, was definitely known. It is a plastic clay and toughened the fibre. This is significant also that the process sold to Sebring contains the same proportions of the component parts in the mixture without the ball clay as the formula transferred to the defendant with it. In the Sebring formula Pearson clay is mentioned, and in place of it English china clay is substituted in the formula to the defendant. The witnesses agree that the ingredients are identical.

The defendant paid a large sum of money on the assumption that it was acquiring the exclusive ownership of a valuable secret process. The evidence by a large preponderance shows that it acquired nothing, for the formula was owned by Sebring who had also purchased it from Sweeting.

It is not necessary to decide the other questions discussed in the briefs.

The judgment should he reversed.

All concurred, except Kruse, J., who dissented in a memorandum.

Kruse, J. (dissenting ):

I think it was a fair question of fact whether the formula sold to the defendant by Sweeting was substantially the same as the one which had theretofore been sold by Sweeting to Sebring, and that the jury was warranted in finding that it was not.

The ingredients from which pottery is made seem to be generally known by all potters, so that it is not at all strange that the ingredients contained in the several formulas were nearly alike; but the mixing and the proper proportion of each to be used for obtaining the best results require long and careful study ; as Sweeting says, *780it is the work of a lifetime; and the evidence upon the part of the defendant’s expert tends to sustain this view. He exhibited a sample of the ware he had made, he gave the necessary instruction, turned over the formulas to the defendant, which it used, and I think the case was properly submitted to the jury.

Judgment and order reversed and new trial ordered, with costs to appellant to abide event, upon questions of law and fact.