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relating to this point, before the Court of Appeals of the State of New York, the court said: "The business carried on by the defendant was founded on a secret process known only to herself and her agents. She had the right to continue the business and, by keeping her secret, to enjoy its

necessary to enable the obligee to use the right or secret art, and that he will not divulge the secret to any other person. Such a contract is not in restraint of trade. Vickery v. Welch, 19 Pick. 523. An instrument under seal was executed, upon a sale made by the plaintiff to the defendants, by which the former sold to the latter all his interest in the manufacture of porcelain teeth in the city of New York, with his stock on hand, and the good will of the business. The plaintiff covenanted to instruct one of the defendants in the art of manufacturing porcelain and incorruptible teeth, and to furnish him with his recipes therefor. The agreement also contained the following clause "and the party of the first part will not carry on or cause to be carried on by any person with whom he shall be interested, the manufacture of porcelain teeth, or impart the knowledge of manufacturing the same to any person, other than as aforesaid." It was alleged in the complaint, that the said art of manufacturing porcelain teeth, in which the defendant was to be instructed, was a secret of the plaintiff, and known to be such by the defendant. It was held on demurrer, that the covenant in question was valid, and not one in restraint of trade. Alcock v. Giberton, 5 Duer, 76. The defendant sold to the plaintiff a business of manufacturing and selling the "Government Carbolic Disinfectants," the process of man

ufacturing which was a secret in his possession, and covenanted not to carry on the business of a manufacturer or seller of the "Government Carbolic Disinfectants" or of any other article or thing of a disinfectant nature for fourteen years, and not to disclose the secret for the same period. The plaintiff brought this action, alleging that the defendant was infringing those covenants and seeking to restrain him. The defendant delivered a statement of defense, whereby he specifically denied that he was infringing the covenants, and further demurred on the ground that the covenant not to carry on such business was in restraint of trade and too general in its provisions. Held, that having regard to the subject-matter the covenant was not too general, and that the demurrer must be overruled. Hagg v. Darley, 47 L. J. Ch. 567. In a contract for the sale of the art and mystery of compounding and manufacturing an article of medicine and the exclusive right to make, use and vend the same, the vendor covenanted not to impart the art to any other person and not to make or vend the article himself; in consideration whereof the vendee covenanted to pay a certain sum of money in installments, at specified times. Held, that the covenants were independent, and that the vendor need not allege performance of the contract, on his part, in order to recover the money due. Held, also that it was

benefits to any practicable extent. She also had the right to sell the business, including, as an essential part thereof, the secret process, and, in order to place the purchasers in the same position that she occupied, to promise to divulge

not necessary for the vendor to allege that there was in fact such an art or secret as was mentioned in the contract; or that it was in his exclusive possession. Such a contract is valid, and does not fall under the rule prohibiting a general restraint of trade. Hard v. Seeley, 47 Barb. 428. The principle upon which a contract in general restraint of trade is held to be void as against public policy, is that such a contract deprives the public of the enterprise and skill of one of the parties to the contract, and injures him, without any corresponding benefit to the party contracting for such restriction. Although the policy of the law does not permit general agreements in restraint of trade, a person who is engaged in a particular business which he is carrying on by means of a secret process which he has discovered, may sell the secret to another and may lawfully contract with the purchaser that he will not thereafter use that secret in such business without the consent of the purchaser and will will not disclose the secret to others. Jarvis v. Peck, 10 Paige Ch. 118. "If he invents or discovers, and keeps secret a process of manufacture whether a proper subject for a patent or not, he has not, indeed, an exclusive right to it as against the public or against those who in good faith acquire knowledge of it; but he has a property in it which a court of chancery will protect against one who in violation of contract and breach of

confidence undertakes to apply it to his own use or to disclose it to third persons. The jurisdiction in equity to interfere by injunction to prevent such a breach of trust, when the injury would be irreparable and the remedy at law inadequate, is well established by authority. In the earliest reported case of this kind, Lord Eldon, indeed, refused to grant an injunction against imparting, in violation of an agreement, the secret, not only of a patent which had been obtained and had expired, and which the whole public was, therefore, entitled to use, but also that of making a certain kind of pills, for which no patent had been procured, and stated, as a reason for the latter, that if the art and method of preparing them was a secret, the court could not, without having it disclosed, ascertain whether it had been infringed. Newberry V. James, 2 Meriv. 446. But the same learned chancellor afterwards considered the general question as still an open one, whether a court of equity would restrain a party from divulging a secret in medicine, which was not protected by patent, but which he had promised to keep, and in such a case dissolved an injunction of the vicechancellor, upon the sole ground that the defendant made affidavit that the secret was not derived from the plaintiff. Williams v. Williams, 3 Meriv. 157. And in a later case he unhesitatingly granted an injunction against one who, by the terms of his agreement with

the secret to them alone and to keep it from every one else. In no other way could she sell what she had and get what it was worth. Having the right to make this promise she also had the right to make it good to her vendees and to protect them by covenants with proper safeguards against the consequences of any violation. Such a contract simply left matters substantially as they were before the sale, except that the seller of the secret had agreed that she would not destroy its value after she had received full value for it. The covenant was not in general restraint of trade, but was a reasonable measure of mutual protection to the parties, as it enabled the one to sell at the highest

the plaintiff, was not to be instructed in the secret, and who obtained a knowledge of it by a breach of trust. Lovatt v. Winyard, 1 Jac. & Walk. 394. Sir John Leach decreed, in one case, specific performance of an agreement by a trader to sell the good will of a business, and the exclusive secret of dyeing; and, in another, an account of the profits of a secret for making a medicine against a son of the inventor, holding it in trust for his brothers and sisters. Byron v. Whitehead, 1 Sim. & Stu. 74; Green v. Folgham, 1 Sim. & Stu. 398. In a more recent case, Morrison, the inventor and sole proprietor of a medicine, for which no patent had been obtained, entered into partnership with Moat, to whom he communicated the secret of making the medicine, but did not make the secret a part of the assets of the partnership, and reserved it to himself as against all other persons, and Moat covenanted not to reveal it to any person whomsoever. By subsequent agreement Morrison's sons and a son of Moat were admitted as partners in the business, and the secret was surreptitiously obtained from Moat by

his son. After the death of both the original parties, on a bill brought by Morrison's sons, who were also legatees of the secret, against Moat's son, Vice-Chancellor Turner, in an elaborate judgment, reviewing all the English authorities, granted an injunction restraining the defendant from using the secret in any manner in compounding the medicine, and refused to restrain him from communicating the secret, simply for want of any allegation or evidence of any intention to communicate it. Morrison v. Moat, 9 Hare, 241. The defendant appealed, but the order was affirmed (21 L. J. Ch. 248), and Lord Cranworth, delivering the opinion of the Court of Appeal, said: "The principles that were argued in this case, are principles really not to be called in controversy. There is no doubt whatever, that when a party who has a secret in trade employs persons under a contract, express or implied, those persons cannot gain the knowledge of the secret, and then set it up against their employer.'" Gray, J., in Peabody v. Norfolk, 98 Mass. 452, 458.

price and the other to get what they paid for. It imposed no restriction upon either that was not beneficial to the other by enhancing the price to the seller or protecting the purchaser. Recent cases make it clear that such an agreement is not opposed to public policy, even if the restriction was unlimited as to both time and territory." Where a contract relating to a trade secret is of such a character that the effect of it will be prejudicial to the public interest it will not be sustained. In a case in Massachusetts it was held that a contract made between citizens of this commonwealth, by which one of them agreed for a good consideration, never to "set up, exercise or carry on the trade or business of manufacturing and selling shoe-cutters at any place within the commonwealth of Massachusetts," is illegal as being in restraint of trade, although the manufacture of shoe-cutters is an art which can only be carried on by persons instructed in the same, and at the time of making the above contract the person so promising was ignorant of said art, and his said promise was made as a part of an agreement of partnership with one who was skilled and actually engaged in carrying on the same, and to take effect at the expiration of the partnership, and although at that time only three other persons were engaged in the business.2

§ 53. Restraint of Trade by Patents.-It is public policy to encourage useful inventions by granting the inventor a monopoly in the manufacture and sale of the article invented for a limited period. In a recent case before the United States Circuit Court for the Eastern District of Missouri, the rule is stated, as follows: "The entire theory and purpose of our patent laws is to create a limited monopoly. In consideration that a patentee will give his invention to the public, with full drawings and specifications so as to enable the public to freely use it at the expiration of seventeen years, a grant is made to him of an exclusive right to the monopoly of the patented article or device

1 Tode v. Gross, 127 N. Y. 480, 485.

2 Taylor v. Blanchard, 13 Allen, 370.

during that time. The rights so acquired by the patentee under a grant from the United States are entirely inconsistent with the patentee's being made subject to the provisions of the anti-trust laws of the several States. Under his grant he has been given, and for the consideration alluded to, is entitled to maintain a monopoly in the disposition or use of the patented article or device." Public

1 Columbia Wire Co. v. Freeman Wire Co., 71 Fed. Rep. 302, 306. See also Edison Electric Light Co. v. Sawyer-Mann Electric Co., 3 C. C. A. 605; s. c., 53 Fed. Rep. 592; Strait v. Harrow Co., 51 Fed. Rep. 819; Soda Fountain Co. v. Green, 69 Fed. Rep. 333; Billings v. Ames, 32 Mo. 265. "The objection that the covenants are void as being in restraint of trade, cannot be supported, admitting that all the patents are void. Agreements to restrain trade in particular places, founded on a reasonable consideration, are valid in law, and may be enforced. Here was a sufficient consideration, whether the patents were valid or not. Being the inventors of these machines, the parties may obtain valid patents for them; or, without thus securing a monopoly, they might reasonably expect to enjoy it, in fact, by means of their superior skill. For a time, at least, they would have little to fear from the competition of others. It was, therefore, lawful and reasonable for them to share in the profits of their invention, either by uniting in a joint concern, or by a more convenient arrangement, whereby each one might have the benefit of his own capital, industry and activity." Stearns v. Barrett, 1 Pick. 443; s. c., 11 Am. Dec. 223, 227.

The invalidity of a patent does not destroy the consideration for a contract, based on its supposed validity, to settle litigation

under it, and fix the respective rights of the parties, especially where the contract includes mutual Covenants as to the conduct of their business, and is partly executed before the invalidity is discovered. Gloucester Isinglass & Glue Co. v. Russia Cement Co., 154 Mass. 92; s. c.. 12 L. R. A. 563. The grant of the right to make, use and vend a patented article "within the southern half of Alabama, less C county," is not void for uncertainty in defining the boundaries of the territory. Dudley v. Suddoth (1891), 91 Ala. 349; S. C., 8 So. Rep. 873. "Considerations which might obtain, if the agreement were in regard to other articles, cannot be of any weight in the decision of a question arising upon an agreement as to patented articles. If an owner of a patent should choose to refuse to manufacture the article covered by his patent, could anyone else claim such right? His simple neglect or refusal to manufacture would stand as a conclusive reason why it was not manufactured. An owner might sometimes make more money by not manufacturing than by doing so, but of that question he is the sole and absolute judge.” Good v. Daland, 121 N. Y. 1, 8; S. C., 24 N. E. Rep. 15, 16. Complainants, who were manufacturing, under patents. stays which consisted of a stiffening blade having a sheet of rubber on each side,

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