noting that “in the area of confidential relationships,” party who discloses another party’s trade secret or confidential information may be subject to tort liability apart from breach of any express agreement for which party may be liable
How later courts described this case
- noting that “in the area of confidential relationships,” party who discloses another party’s trade secret or confidential information may be subject to tort liability apart from breach of any express agreement for which party may be liable
- adopting the definition of a trade secret in the Restatement (First) of Torts § 757 (1939)
- noting that existence of confidential relationship is to be determined in each case, and viewing picture as a whole, trial court concluded that confidential relationship existed
- stating that “[t]he protection of a trade secret is a well[-]recognized objective of equity”
Written by the judges who cited it.
The opinion
Mr. Justice Walker,
dissenting.
*593 After further consideration, I have concluded that our decision in this case is unsound. Since the entire patent file becomes public property when the patent issues, the information contained therein can no longer constitute a trade secret. When the parties made their license agreement, respondent had filed his original patent application containing seventeen separate and distinct claims of novelty and invention. Thirteen of these claims were rejected by the Patent Office because of lack of invention or conflicts with prior patents and were cancelled by respondent in subsequent amendments to his application. While the patent as issued lists ten claims, these embody only four of those which were listed in the original application with some additional claims asserted in the amended applications.
The entire world now has access to the file and is free to manufacture and sell devices incorporating the features of the thirteen rejected and cancelled claims except as the same may be protected by other patents, but petitioner has been perpetually enjoined from doing so. The net result is that petitioner is prevented from ever hereafter doing that which everyone else is free to do. Since respondent can be adequately protected by damages or by an injunction of limited duration, the trial court’s judgment is clearly more punitive than remedial.
This action cannot be justified by saying that a patent may not afford the same protection as a trade secret or that an award for damages for patent infringement may not fully protect respondent. Respondent testified that his patent application was made as broad as possible, because the Patent Office would “kick back” all he couldn’t use. Although it was thus contemplated that some of the claims might be rejected and have no protection either from the patent or as trade secrets after the patent issued, the contract does not bind petitioner never to use any of the information disclosed to it. By applying for and accepting his patent, respondent elected to look to it for protection and broadcast his secrets to the world. He chose disclosure and patent protection in preference to a trade secret. The narrow question is whether under all these circumstances petitioner is under a legal duty never to use any of the information obtained from respondent, and in my opinion it is not.
Our original opinion apparently recognizes that the trial court’s judgment goes too far. It suggests that respondent might have been entitled only to an injunction of limited duration if petitioner had laid a proper predicate by alternative pleadings and supporting evidence showing that the same would afford *594 respondent adequate protection. This does not comport with my idea of the burden resting upon the moving party in an equitable proceeding. It should not be said that he can simply establish his right to some sort of relief and then be granted much more than is actually required for his protection unless the defendant proves that he is entitled to less.
While petitioner does not here argue that the injunction should have been limited to a period of years, it has vigorously contended from the beginning that the permanent injunction should not have been granted and that the rule of Conmar Products Corporation v. Universal Slide Fastener Co., 2nd Cir., 172 F. 2d 150 , should be applied in this case. It is my opinion that the burden was upon respondent to establish his right to the relief granted, i.e., a perpetual injunction. This he has not done. In a case where there are no pleadings or evidence justifying the issuance of an injunction of limited duration, we should follow the rule of the Conmar case and deny injunctive relief after the trade secrets have been made public through the issuance of a patent. See 36 Texas Law Rev. 384.
I would reverse and render the judgments of the courts below in so far as petitioner has been permanently enjoined from manufacturing or selling any device embodying features described in the original patent application which were not carried forward and reserved in the patent.
Opinion delivered June 4, 1958.
2nd Motion for rehearing overruled July 16, 1958.