Santa Monica Ice & Cold Storage Co. v. Rossier

NOURSE, P. J.

For a number of years the plaintiff had been engaged in the sale of ice in the City of Santa Monica through distributors who. were paid a salary and commission. The defendants, Rossier, Matheson and Matheson, as copartners, were selling ice out of Culver City under the trade name of Pure Ice Company. The defendants, Jacobs, Sr., Jacobs, Jr., and Tanner, were employees of plaintiff. In March, 1938, the three last named defendants left plaintiff’s employment and engaged to work for the partnership in competition with plaintiff. The Santa Monica district had been divided by plaintiff into two working territories designated in the evidence as route No. 1 and route No. 2. While employed by plaintiff, Jacobs, Jr., had worked route No. 1, Tanner had worked route No. 2, and Jacobs, Sr., had worked both. Jacobs, Sr., was the father of Jacobs, Jr., and the father-in-law of Tanner. In an effort to avoid a charge of unfair competition the partnership assigned Jacobs, Jr., to route No. 2 and Tanner to route No. 1, while Jacobs, Sr., worked with both in both territories. Before leaving the employment of plaintiff, Jacobs, Jr., notified his customers of the proposed change and asked them to patronize Tanner. Jacobs, Sr., took Tanner through the district and urged his former customers to give him their trade. At the beginning of their new employment one or more of these defendants was accompanied by Rossier to whom their former customers were designated. In some instances when the party had been a customer of the employee accompanying Rossier the latter personally made the deliveries. The plaintiff was able to show that, because of these activities of the several defendants, it had lost a large number of its customers. Its application for an injunction to restrain these activities was granted, and all defendants appeal. They attack the judgment both as to the restraint

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placed upon the three former employees of- the plaintiff, and as to that placed upon the partnership which gave them their new employment.

The gravamen of the action is the alleged disclosure and unlawful use of trade secrets and confidential information obtained by the former employees through the good will and personal contacts -fostered by their employers. Particular emphasis is laid on the “route books” which it is charged these employees made use of in their new employment. The respondent states the character and value of these books as follows.- “Bach of the distributors has a particular established trade route. The names and addresses of plaintiff's customers are kept in specially prepared loose leaf volumes, containing the names and addresses of the customers, the days upon which deliveries of ice are to be made and other information such as whether the customer is a cash customer or charge customer, together with any special information respecting the habits, customs and preferences of the customer. Bach driver is furnished with such a volume (known as a route book) covering the particular territory and route which has been assigned to such driver. A duplicate of the list is kept in the office of the Company and from time to time is checked with the route book so as to add new customers who may from time to time be acquired. These lists have been compiled and are maintained at the expenditure of a substantial sum of money by the Company and enable the plaintiff to keep a check upon its business and to increase and extend it where possible.”