Riess v. Sanford

NOURSE, P. J.

The plaintiff had a judgment against defendant Sanford restraining him from manufacturing or selling cactus phonograph needles made of and from cactus spines of the species, type and character manufactured by the plaintiff. Damages for the unlawful manufacture and sale of such needles were awarded plaintiff against this defendant in the sum of $2792. Judgment also went against the co-defendant granting similar injunctive relief and damages in the sum of $1500. This defendant did not appeal and the judgment against it has become final. The defendant Sanford has appealed on a typewritten record.

The trial court found that the plaintiff had established a valuable business throughout the United States in the manufacture and sale of cactus phonograph needles under the trade name of “Kaeti”; that in connection with said business he became the owner of certain trade or business secrets consisting of information as to the type of material used in the manufacture of said needles and the source of said material. The defendant, who Imew nothing about the business, entered the employment of the plaintiff and during a period of three years in the course of his employment became acquainted with and familiar with all the secrets of his employer wdth the secret intention of gathering such information for the purpose of using it in future competition with plaintiff. During such employment he secretly entered into a contract with his co-defendant, a competitor of the plaintiff in the manufacture and sale of phonograph needles, under which he undertook to make use of these trade secrets to learn the species of cacti used in the manufacture of said needles and the source of supply where such spines could be obtained, and to use such information in the manufacture of such needles and their sale to his co-defendant. Before entering into this contract the defendant learned from his employer that his co-defendant had unsuccessfully endeavored to obtain from plaintiff the exclusive right of distribution and sale of the phonograph needles manufactured by the plaintiff.

The evidence fully supports the findings. The needles manufactured and sold by the plaintiff were made from a

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species of cacti known as the Sahuaro which grows in a particular belt north of Tucson, Arizona, and is not found in any other part of the country. This is one of some eight hundred species of cacti and the only one suitable for this purpose. These facts having been made known to the defendant, he secretly visited the tract on two occasions during his employment for the purpose of learning the source of supply and the method of collecting and delivering the spines. While still employed by the plaintiff, this defendant secretly manufactured a large number of needles either from the supply which his employer had on hand or from material obtained by the defendant during his employment from the Arizona field. These he exhibited to his co-defendant in his negotiations for the contract above referred to, and the plaintiff testified that after the defendant had left his employment lie discovered that the defendant had failed to deliver about 25% of the needles he should have received out of the raw material which the plaintiff had put in his possession.