Universal Talking-Machine Co. v. English — 69 N.Y.S. 813

Majority

p. 813

(34 Misc. Rep. 342.)

UNIVERSAL TALKING-MACH. CO. v. ENGLISH.

(Supreme Court, Special Term, New York County.

March, 1901.)

Headnote

1. Injunction—Contract or Employment—Breach.

Equity win not enjoin an employs having special knowledge or skill, and who refuses to render further services, from performing similar services for any other than the employer in violation of his contract, unless it is affirmatively shown by the employer that such skill cannot be supplied by others.

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2. Same—Inventions op Employe.

Where an employé contracts to assign to his employer all inventions made hy him during his employment, he will not be enjoined from using such inventions to the injury of his employer, where the evidence fails to show any invention made by the employé during the term of his employment.

Suit by the Universal Talking-Machine Company against John C. English. Motion to continue temporary injunction.

Denied.

Olney & Comstock, for the motion.

J. E. Ludden, opposed.

The defendant’s contract with the plaintiff contained four several and severable obligations on 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, 1899) 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 employé, so that in case of a default 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 employé 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

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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 employé who still remains with the plaintiff. This employé 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 employs or necessarily disclosed to him while occupying a confidential relation towards the owner, and such employe 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 of equity will grant relief and enjoin the employé from making use of said knowledge to the prejudice of his employer.”

Kodak Co. v. Reichenbach, 79 Hun, 184 , 29 N. Y. Supp. 1143 ; Little v. Gallus, 4 App. Div. 569 , 38 N. Y. Supp. 487 .

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 any one

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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 any one, save plaintiff’s officers and employés, any processes, apparatus, inventions, or improvements relating to the production of records, or that he has threatened to do so, or told any one 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 contract, 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 Jaw secondly above stated. The motion to continue the injunction must be denied, and the temporary injunction vacated, with $10 costs to defendant.

Motion denied, and temporary injunction vacated, with $10 costs to defendant.