New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1910-04-02
INJUNCTION UPHELD
TRADE RIVAL LOSES.
Former Employe Barred from
Engaging an Same Business.

The Court OF Appeals has Just rendered
decision against the defendant IN the action
of the Mccall Company against John H
Wright, which is OF unusual importance TO
commercial interests The main question
involved. as stated by the Court Of Az
peals, was a. To- the extent TO which
court Of equity would intervene 20 restrain
by injunction an emplOye Of corporation
from using 10 the disadvantage OF mis- en-
plOyer the business information which hs
had acquired while in its employ, by
Stunning the management Of rival concern.
IN violation OF his express agreement not 20 .
compete with his employers business
The suit for an injunction was begun by
the plaintiff in February Of last year Tire
circumstances which led TO the bringing OF
the suit. according 10 the complaint. ara =
these: The plaintiff is one OF the large
manufacturers Of paper dress patterns. fss 2
business having attained great proportions.
mainly By reason Of methods and systems
devised and PIT in operation BY its presi-
dent James TT. OttIey- and which we're to
a large extent original and confidential IN
their nature. The defendant came frorn-a
bOOkkeeper's desk IN a department store II
the plaintiffs employ in 1901 at 81 a week
but was rapidly promoted. through several p
various grades OF the business. until rS
occupied a position in which his acqusinr-
ance with the business and mis- general IN
p0rtance and authority were second only 70
the presidents.
TIE defendsrt was discharged IN Dscerr-
Der. IaeS for engaging in an outside busi-
ness venture. but on hts promise OF fidelity
70 his employer for the future he was
taken back into the employment OF Lss
plaintiff under temporary contracts. which 81
were finally superseded by contract made
in January Of last year. which is the uasis
Of the action
Under that contract he agreed 70 render
SUCH services as should be assigned 70 him
from time 10 time for A term OF six years
al a large and continuously Increasing rate
Of compensation Under the new szreeru7nt
the defendant stipulated that ne was not
10 engage in any other business during ~.
sfx-vear period covered By The caJutrast.
ard also that in case he entered the en-
pIOyment Of a rival concern during that
time an injunction might issue against him
The complaint states that the defendant
Intended 20 violate this last contract at th-
time he made 10. and that while Ne vas IN
the plaintiffs employment under 10 rs
quietly negotiated with rival concerns FOR
a position with them. and about thres
weeks after his contract with the PLAINTIFF
had been signed left its employ without
cause or provocstio1 and became The press-
dent and active manager OF a rival pattern
company
The trial court decided these circun,-
stances would not entttle the PLAINTIFF tn
an injunction. the Defendants services
and qualifications not being special.
unique and extraordinary. The AppelIsts
Division reversed this ruling and held tfar
1. % cir h. r7f.
tiff would be entitled 20 an Injunction as
the Defendants qualifications for injurfnE
the plaintiff by advancing the interests OF
a competitor are special, unique and sE-
traordinary.
The appeal 10 the Court OF Appeals was
heard IN the early part - this wear. and
the opinion just handed down sustains the
decision OF the Appellate Division, on the
ground that the agreement is a valua5ls
right in connection with the Mccall Com
pany's business. which NAV be enforced
The court SAYS that this question has most
frequently come I'D in connection with On,
sale OF q business under an agreement not
70 start in a competing one. and adds
There is no fundamental principle II
favor of the validity and -enforceaolity @
such an agreement in the case OF me sale
of a business which would not sustain a
contract on good consideration PROHIBITING
for a limited period an enpIOye who has
entered the empiUC-men and learned the
business Of one employer from Carrying
the benefits Of the Information and trade
secrets thus acquired into the employment
and maintenance OF a competing business
The PLAINTIFF was represented in the
Court Of Appeals by Sackett. Chapman &
Stevens and the defendant BY Louis Mar
shall.