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Caputo v. Nice-Pak Products

April 22, 1997

GARRY L. CAPUTO D/B/A G.C. ASSOCIATES, PLAINTIFF-APPELLANT,
v.
NICE-PAK PRODUCTS, INC., DEFENDANT-RESPONDENT.



On appeal from the Superior Court of New Jersey, Law Division, Bergen County.

Approved for Publication April 22, 1997. As Corrected May 22, 1997.

Before Judges Shebell, P.g. Levy and Braithwaite. The opinion of the court was delivered by Shebell, P.j.a.d.

The opinion of the court was delivered by: Shebell

The opinion of the court was delivered by

SHEBELL, P.J.A.D.

In November 1993, plaintiff filed a complaint in the Law Division against defendant, Nice-Pak Products, Inc., his former employer, alleging defendant failed to pay plaintiff the consideration orally promised for plaintiff's assignment of his invention of a process to install a re-sealable label flap for packaging a product sold by defendant. The complaint contained three counts: 1) rescission of the contract of assignment, 2) recovery of patent royalties, and 3) unjust enrichment.

Defendant filed an answer denying plaintiff's allegations and, thereafter, moved for summary judgment. In March 1995, the Judge dismissed the recision count with prejudice for lack of subject matter jurisdiction, but denied defendant's motion as to counts two and three. In April 1996, defendant's second motion for summary judgment was denied. The case proceeded to trial before a jury; however, at the close of all evidence, a directed verdict was granted in defendant's favor on the remaining counts. Plaintiff appeals.

The facts reflect that in 1981 plaintiff began to work for defendant two days per week as an independent contractor. He was paid $1500 per month plus expenses. He worked on various packaging projects involving products sold by defendant.

In 1984, defendant began manufacturing a package of moist towelettes known as "Travel Pak." Defendant paid a royalty and used a Japanese firm's patent for the re-sealable flap. In 1987, defendant sought to avoid paying the royalty by devising its own technology. Defendant assigned the task to plaintiff, who began considering solutions for the problem.

In March 1987, plaintiff came up with an idea that led to the process of using a "corona treating" machine to selectively treat one zone on the top of the package so that the flap would be secured to the package at the treated zone, allowing the user to open the flap and then reseal it without the flap's coming off. According to plaintiff, the concept of corona treating by zone was his own new concept.

When plaintiff first proposed this method to defendant, defendant did not believe it would work, but plaintiff began experimenting. He built two of his own corona treatment machines, neither of which worked well enough. Therefore, defendant sent plaintiff and another employee to a Connecticut firm, Coretech, to have a more powerful treater machine built.

Plaintiff sent a letter to William Dwan, defendant's then senior vice president of technical services, enclosing a sketch of his invention and recommending defendant apply for patent protection. According to plaintiff, sometime in June 1987, Dwan agreed that defendant would pay for the technology to develop the process and that defendant would pay plaintiff a royalty of ten percent of the gross sales of the product.

In November 1987, plaintiff signed a written assignment of the invention to defendant, reciting a consideration "of One Dollar ($1.00) to us in hand paid by the said Assignee, and other good and valuable consideration." The assignment designated three "inventors" of the process, plaintiff, Dwan, and Saldarelli, each of whom executed the assignment. According to plaintiff, the recited consideration implicitly also included payment of the ten percent royalty promised to plaintiff in June 1987. Defendant submitted a patent application for the invention, which was ultimately granted.

In January 1989, before the patent was issued, defendant's president and owner fired plaintiff, stating that he did not need plaintiff's services anymore. He told plaintiff he had decided not to use plaintiff's invention. Plaintiff, later that year, heard the patent had issued. In 1993, while shopping in a supermarket, he discovered ...


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