FALL 2008

Trade Secrets


Course No. 9200-704 (and 804)-801

ID No. 16545

MW 3:00 - 4:30 p.m.
Room L-134
Professor Jay Dratler, Jr.
Room 231D (IP Alcove)
(330) 972-7972
Copyright © 2000, 2002, 2003, 2006, 2008   Jay Dratler, Jr.   For permission, see CMI.

Questions and Notes on Wexler v. Greenberg and
B. F. Goodrich Co. v. Wohlgemuth

1.  What was the main issue in Wexler and Wohlgemuth?  Was it whether trade secrets existed, or whether they were misappropriated?  In each case, on what facts and legal doctrine does resolution of that issue depend?

2.  Are the two cases reconcilable, or was one wrongly decided?  Both Wexler and Wohlgemuth wanted to improve their position in life, didn't they?  Didn't both take what opportunities were offered them?  What specific facts, if any, were responsible for the court reversing the injunction in Wexler and granting a broad injunction in Wohlgemuth?

3.  What about the "smell test"?  Did what the defendants did in both cases smell the same?  Were there any odoriferous facts or testimony in either case that might have influenced the court?

4.  Apart from the smell test, do the results in the two cases make economic sense?  Weren't roughly the same countervailing economic policies at work in both cases?  If so, then why the different results?  In balancing the policies, did one court weigh some policies more heavily than the other court did?  If so, what policies?  Did the facts of the cases justify the weights that each court put on the particular policies that it stressed?

5.  Some courts and commentators refer to cases like Wohlgemuth as "inevitable disclosure" cases.  To see why, consider what might have happened if Wohlgemuth actually had gone to work for International Latex.  Over the long run, could he have kept himself from using trade-secret information acquired at B.F. Goodrich, perhaps unconsiously, even if acting in the utmost good faith?  As you think about this question, consider the large number of trade secrets to which he had access in his various positions at B.F. Goodrich and the competitive pressure that he would face in his new job.

"Inevitable disclosure" cases like this are among the few in which courts will grant broad permanent injunctive relief, without any time limit.  Was such relief appropriate in this case?  What are the economic policies for and against it?  Was it fair to Wolhgemuth under the circumstances?  Would a time-limited injunction have been fair to B.F. Goodrich, in light of the longevity and productivity of its research in the space-suit field?

6.  Could the chemical formulas that Greenberg developed at Buckingham still be trade secrets?  If so, who owns the trade secrets?  Suppose a third party, C, steals the formulas from a safe in Brite's office.  Would Brite have an action for misappropriation against C?  Would Greenberg?  Would Buckingham?  Suppose C steals the foruulas from a safe in Buckingham's office.  Would Buckingham has a cause of action for misappropriation against C?  Would Greenberg?  Would Brite?  What is the best was to do justice in this situation, to apportion ownership of the trade secrets, or to limit the persons who can sue for misappropriation?

7.  Wexler is the first case we have studied that contains a serious and extended discussion of the policies underlying legal protection of trade secrets.  Are those policies limited to cases of alleged misappropriation by former employees, or are they more general?   Make two lists of economic and social policies—those that favor the plaintiff, and those that favor the defendant.  As you read the cases in this course, add to both lists.  Is there more to the polices underlying trade-secret protection than just encouraging innovation and promoting commercial morality?

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