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Ingersoll-Rand Co. v. Ciavatta

Decided: April 8, 1987.

INGERSOLL-RAND COMPANY, A NEW JERSEY CORPORATION, AND INGERSOLL-RAND RESEARCH, INC., A DELAWARE CORPORATION, PLAINTIFFS-RESPONDENTS,
v.
ARMAND CIAVATTA, A RESIDENT OF NEW JERSEY, DEFENDANT-APPELLANT



On appeal from Superior Court of New Jersey, Chancery Division, Somerset County whose opinion is reported at 210 N.J. Super. 339.

Dreier, Shebell and Stern. The opinion of the court was delivered by Dreier, J.A.D.

Dreier

Defendant, Armand Ciavatta, has appealed from a Chancery Division judgment enforcing a contractual obligation contained in an "Agreement Relating to Proprietary Matter" he signed while an employee of plaintiffs, Ingersoll-Rand Company and Ingersoll-Rand Research, Inc. (hereafter collectively called "plaintiff" or "Ingersoll-Rand"). The trial judge in a comprehensive opinion reported at 210 N.J. Super. 339 (Ch.Div.1986) made extensive factual determinations which need only briefly to be reviewed here, since we accept these determinations which are amply supported by the record. Rova Farms Resort Inc. v. Investors Insurance Co., 65 N.J. 474, 483-484 (1974).

In October 1974, after two years' employment with another of plaintiff's subsidiaries defendant was hired as a program manager by Ingersoll-Rand Research. As a condition of his employment he signed an agreement assigning to his employer

(c) Within one year after termination of such employment if conceived as a result of and is attributable to work done during such employment and relates to a method, substance, machine, article of manufacture or improvements therein within the scope of the business of the COMPANY or any of its affiliates.

The products relevant to this litigation are a new type of friction stabilizer, developed by defendant, and a split-set friction stabilizer, manufactured and distributed by plaintiff. Both devices are used in the mining industry to prevent the separation of rock strata in mine roofs. Plaintiff, through sales of its patented split-set, has established a dominant position in the market with sales projected through the trial year at 3,000,000 units a

year at approximately $3 a unit. Although not then assigned to the manufacture of stabilizers, defendant submitted five proposals through 1975 for devices to support or stabilize mine roofs. Four of the five were not friction stabilizers, but one was an improvement to plaintiff's split-set.

From 1974 to March 1978 defendant worked in research capacities on products other than those relevant to this litigation. At the latter date he was promoted to manager of the friction stabilizer manufacturing unit dealing with the various outside manufacturing concerns fabricating the split set. He was fired on June 22, 1979 because of a conflict with his superior. He alleged that he left with no thought of developing a competing product, and no proof was offered to the contrary. Although he sought employment with other Ingersoll-Rand divisions, he was unsuccessful and then began a lengthy process of attempting to find other employment. Seven months later he found employment out of the industry with a firm which was experiencing serious financial difficulties, but that employment lasted only five months.

Defendant formulated his initial ideas concerning the new friction stabilizer while repairing a light fixture in his house approximately two months after he was fired. He filed his patent application nine months after termination and an improvement patent application a year after the initial filing. In February and March 1982 he was issued patents which the trial judge determined were encompassed by the agreement and must be assigned to plaintiff.

The trial judge made detailed factual findings establishing the basis for his determination that defendant's inventions were not based upon trade secrets or other confidential information of plaintiff. We need not recount the tribulations of defendant in achieving financing and his initial distribution of his product insofar as it relates to any claim of estoppel, laches, or unclean

hands. We accept the determination of the trial judge concerning these issues. 210 ...


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