Opinion ID: 1989929
Heading Depth: 3
Heading Rank: 3

Heading: Evidence regarding breach.

Text: In order to find in favor of Revere concerning its claim of tortious interference with business relations, the jury had to find that Delfino and Eckart violated their agreement with Revere concerning disclosure of Revere's proprietary information and assignment of rights to inventions. See Iowa-Illinois Gas & Elec. Co. v. Black & Veatch, 497 N.W.2d 821, 825 (Iowa 1993) (questions of performance or breach are for the jury). Deere argued to the jury that the March 12 proposal did not contain confidential information or trade secrets belonging to Revere, but rather that the drawings were in fact based on prior art of a welded-in sensor. Deere also presented evidence that drawings of the Gozinta that Revere submitted to Deere did not contain proprietary stamps, which were required if the information was to be considered confidential between the parties. Deere thus contends that Revere cannot argue that information Delfino, and Eckart disclosed in the March 12 proposal was confidential when in fact Revere disclosed essentially the same information to Deere. Upon our review, we conclude that substantial evidence supports the jury's verdict that Delfino and Eckart breached their agreement with Revere either based on the conclusion that they made a discovery or invention which they failed to disclose or assign to Revere, or wrongfully disclosed confidential information, knowledge or data. First, the agreement required Delfino and Eckart to disclose or assign any inventions and/or discoveries to Revere made during the course of their employment and likewise precluded them from disclosing confidential information, knowledge or data belonging to Revere. Trade secrets would clearly fall within the definition of confidential information. Revere thus did not have to prove that the confidential information disclosed amounted to a trade secret, but rather only had to convince the jury that information depicted in the March 12 proposal amounted to a discovery or invention or that the proposal contained confidential information, knowledge or data belonging to Revere. [2] This fact is consistent with the jury's finding that Deere tortiously interfered with Revere's agreement with Delfino and Eckart, but did not misappropriate Revere's trade secrets. Second, Revere presented evidence from which the jury could conclude that Delfino and Eckart's March 12 proposal to Deere contained confidential information, knowledge or data, belonging to Revere that was not generally published or made available to the public, including to Deere. By comparing the drawings depicted in D E's March 12 proposal to Deere with Revere's original drawings of the Gozinta, Elengo of Revere testified that in his opinion the diameter of the holes depicted in the March 12 proposal were identical to those depicted in the drawings of Revere's Gozinta. Elengo also testified that the diameter of holes depicted in a document entitled Draft Sensor Development Program, D E Sensor Manufacturing, were Revere trade secrets, that this information was not publicly available and that this information was not disclosed in the Gozinta patent. Additionally, Elengo testified that Delfino and Eckart had access to Revere's drawings of the Gozinta during the course of their employment with Revere and further testified that the device described in the March 12 proposal could not have been designed in four or five days without using Revere's trade secrets. A proprietary stamp appears on Revere's drawings of the Gozinta stating, [t]his drawing contains proprietary information which shall not be reproduced or transferred to other drawings or disclosed to others or used for manufacturing or any other purpose without written permission of Revere Corporation of America. Delfino and Eckart were thus put on notice that Revere considered any information that appeared in the Gozinta drawings to be confidential. Delfino and Eckart likewise affixed a proprietary stamp with language similar to Revere's stamp on the drawings they submitted with the March 12 proposal, which the jury could find incorporated Revere confidential proprietary information. Deere presented evidence through its witness, Walt Jacobson, the inventor of the Gozinta, that size and placement of the strain gauges, and all the other features of the product are allegedly common knowledge. Jacobson also testified that what he invented, or the strong part of the invention, was the knurl feature of the device. Deere also presented evidence that the idea of welding a sensor had been the subject of prior patents. Despite this testimony, and even if true, the jury could still conclude that the Gozinta drawings as a whole, on which D E's March 12 proposal was based, represented the substantial time and money expended by Revere in how it thought the sensor should be designed and manufactured. It was this specific information that Delfino and Eckart acquired by virtue of their employment with Revere and it was this information which they were precluded from disclosing under their agreement to the detriment of Revere. See Basic Chems., Inc. v. Benson, 251 N.W.2d 220, 229-30 (Iowa 1977) (rejecting defendant's contention that he had right to take skills and knowledge he acquired during employment with former employer, including formulas and information contained in buy books and cost books because they were the result of his efforts; knowledge acquired by employee cannot be used to injury of employer during employment) (quoting Sperry Rand Corp. v. Rothlein, 241 F.Supp. 549, 564-65 (D.Conn.1964)); Callmann, § 14.12, at 53 (1996) (one who receives information in a confidential capacity has a duty not to use or disclose such information even though others might already be aware of it). [3] Additionally, we find no merit in Deere's contentions that the device D E actually sold to Deere was different from that outlined in the original proposal. The critical facts are that Delfino and Eckart, while still employed by Revere, began working on a device, prepared drawings and designs that incorporated Revere's confidential information, and disclosed this information to a third party. From this evidence the jury could reasonably find that D E's March 12 proposal for a sensor was substantially similar to Revere's Gozinta or at least used Revere's designs of the Gozinta as a starting point for D E's sensor. Cf. Olson v. Nieman's, Ltd., 579 N.W.2d 299, 315 (Iowa 1998) (noting that minor modifications did not insulate defendant from liability for misappropriation of trade secrets where evidence showed later device was based on plaintiff's diagram). At the very least, the jury could find that Delfino and Eckart used the technology. Revere had developed with respect to the Gozinta, including the problems associated with the knurl strap interface, to develop a welded-in sensor to Revere's detriment. In effect, Delfino and Eckart took Revere's proprietary information concerning what would not work and used it as a basis to develop a device that would directly compete with Revere. We also reject Deere's contention that the terms of Revere's agreement with Deere concerning what those parties defined as proprietary information, and how that information was disclosed, somehow dictates what information is considered to be confidential under Revere's agreement with Delfino and Eckart. Each agreement establishes its own restrictions and responsibilities upon the parties governed thereunder and the terms of one are not applicable to the other. The record also shows that Delfino and Eckart consulted with a patent attorney concerning whether the welded-in disc sensor was a patentable device and that the attorney opined that the device was patentable. We believe that the jury could conclude from this and other evidence presented that Delfino and Eckart's work on developing the replacement for the Gozinta, following their employment with Revere, amounted to an invention or discovery which Delfino and Eckart were required to disclose to Revere and which they wrongfully disclosed to Deere. Upon our review of the record, we conclude that the jury's finding that Delfino and Eckart breached their agreement with Revere is supported by substantial evidence.