Bolt Associates, Inc. v. Trustees of Columbia University

249 F. Supp. 612, 149 U.S.P.Q. (BNA) 120, 1966 U.S. Dist. LEXIS 10344
CourtDistrict Court, S.D. New York
DecidedJanuary 17, 1966
StatusPublished

This text of 249 F. Supp. 612 (Bolt Associates, Inc. v. Trustees of Columbia University) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bolt Associates, Inc. v. Trustees of Columbia University, 249 F. Supp. 612, 149 U.S.P.Q. (BNA) 120, 1966 U.S. Dist. LEXIS 10344 (S.D.N.Y. 1966).

Opinion

HERLANDS, District Judge:

This is a motion by the plaintiff for a preliminary injunction. It is denied in all respects for the reasons set forth in this opinion.

Subject Matter of the Litigation

The trade secret and device involved in this case concern the plaintiff’s un-[613]*613patented underwater pneumatic acoustical repeater for use in submarine geophysics, the seismological branch of oceanography, for the purpose of developing a profile picture and topography of the ocean floor and the stratification and thickness of the sediments beneath it.

Aside from commercial application, such and similar devices are an essential implement in the defendant’s performance of oceanographic research since November, 1960, for the Navy Department looking to improvements in the techniques of undersea warfare, subsurface deployment and navigation of submarines and methods to locate and destroy enemy craft. Disclosure of further details of this character would impinge upon a security classified underseas warfare development program.

The Complaint

According to the complaint, verified by the plaintiff’s president and filed December 6, 1965, the action is for “unfair competition by the misappropriation of a trade secret belonging to plaintiff” (Complaint, paragraph “1”). Jurisdiction is founded upon diversity of citizenship.

The complaint alleges that, in the spring of 1961, plaintiff’s predecessor in interest discovered, designed and developed a secret process and device “for conducting ocean floor surveys using echo sounders in which the sound source is comprised solely in the release of air under pressure” (Paragraph “5”); that in June 1961, the plaintiff confidentially informed the defendant that it had developed a secret process and device for oceanographic work in which the sound is produced solely by the explosive release of high pressure air and, in that month, the plaintiff secretly demonstrated the said process and device to three named employees of the defendant for the expressed “purpose of determining whether the defendant wished to obtain and pay for a license to utilize” plaintiff’s device and system (Paragraphs “6”, “7” and “15”); that shortly thereafter the defendant misleadingly told the plaintiff that it was “not interested” in the plaintiff’s device whereas, in fact, the defendant “secretly built” a device “closely resembling” the plaintiff’s (Paragraphs “20” and “22”); that, since June 1961 and to the present, the defendant built a number of devices which “embodied features which were in” the plaintiff’s device and the defendant misappropriated by extensive use the plaintiff’s secret device (Paragraphs “21”, “22” and “23”); that the defendant “at all times” secretly continued to develop such devices “for its own use and the benefit of the United States Navy” by misleading the Navy to the plaintiff’s detriment (Paragraphs “24” and “26”); and that the defendant has been “unjustly enriched through its misappropriation of plaintiff’s trade secret” (Paragraph “27”). The defendant will sometimes be referred to in this opinion as the “University”.

The Moving Affidavits

In support of its motion, the plaintiff has submitted four affidavits: the first, by its president, Stephen Chelminski; the second, by one of its attorneys, Roland T. Bryan, sworn to December 4, 1965; the third, by its vice-president, John F. Gilbert; and the fourth, another affidavit by Mr. Bryan, sworn to December 23, 1965.

The Chelminski affidavit asserts that the manufacture and use of the defendant’s device “would immediately and irreparably injure plaintiff” by threatening “to deny to plaintiff and to its licensee [Litton Industries] the exclusivity of its trade secrets” and by threatening “plaintiff’s contract relationship with its licensee.” (Paragraph “7”.)

The Bryan affidavit deals solely with litigation in the United States District Court for the District of New Jersey, 244 F.Supp. 458, between this plaintiff and Alpine Geophysical Associates, Inc. and Walter C. Beckmann (hereinafter referred to as New Jersey defendants). The New Jersey action was one for breach of contract and trust, predicated upon a written, confidential agreement signed on July 19, 1961 and upon discussions looking to a license agreement. In the said confidential agreement, the New [614]*614Jersey defendants had promised not to use or incorporate plaintiff’s design in building devices for others until a patent has been issued or denied to the plaintiff. The New Jersey defendants were charged with having misappropriated the plaintiff’s trade secrets which they had obtained through the subterfuge of simulated negotiations and colorable agreements in 1961 and 1964. The plaintiff’s application therein for a temporary injunction was denied (see “Enclosure 1” annexed to the Bryan affidavit) and its motion for partial summary judgment was granted on or about November 16, 1965. (See “Enclosures 2 and 3” annexed to said affidavit.) The District Court concluded inter alia that “The defense interposed by [the New Jersey] defendants that the specific model of sound source manufactured by them was developed by Lamont Geological Observatory of Columbia University, is no defense to the breach of contract by the defendants.” (“Enclosure 2,” Conclusion -of Law “4”.)

From the papers in the New Jersey proceedings submitted by the plaintiff, the following facts appear: (1) that, commencing in the 1950s, the University engaged in developing sound-generating devices for use in its study of oceanographic seismology; (2) that Chelmin-ski (who later became the plaintiff’s president) and Beckmann (who later became the president of the corporate defendant in the New Jersey action) had been regularly employed in the University’s development laboratory (the Lamont Geological Observatory); (3) that, in June 1961, Chelminski demonstrated an air gun (“underwater pneumatic acoustical repeater”) to the University but no drawings thereof were exhibited; (4) that the University declined to give Chelminski a development contract for his device but suggested that Beckmann might be interested in his proposition; (5) that thereafter the plaintiff and the New Jersey defendants entered into relationships that eventually spawned the New Jersey lawsuit; (6) that, in 1964, the University developed and fabricated prototypes of its own device operating with highly pressurized air as a sound source; (7) that, because the University’s manufacturing facilities were inadequate to produce all of the devices needed in a ten months testing voyage planned for the summer of 1964, the University contracted with the New Jersey defendants to manufacture them in conformity with drawings and a model supplied by the University for that purpose; (8) that thereupon the New Jersey defendants proceeded to fill the University’s purchase order by making the devices as per the University’s drawings and model; and (9) that the University’s and the plaintiff’s devices are mechanically and functionally equivalent.

The Gilbert affidavit points out that the plaintiff received a rental contract (expiring July 23, 1965) from the Navy for “one of its repeating pneumatic acoustical sound sources”; and another rental contract (expiring August 17, 1965) from the Navy for two such devices.

The Bryan affidavit of December 23, 1965 presents documentary evidence that Alpine Geophysical Associates, Inc.

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249 F. Supp. 612, 149 U.S.P.Q. (BNA) 120, 1966 U.S. Dist. LEXIS 10344, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bolt-associates-inc-v-trustees-of-columbia-university-nysd-1966.