Bond v. Polycycle, Inc.

732 A.2d 970, 127 Md. App. 365, 1999 Md. App. LEXIS 127
CourtCourt of Special Appeals of Maryland
DecidedJuly 7, 1999
Docket1545, Sept. Term, 1998
StatusPublished
Cited by25 cases

This text of 732 A.2d 970 (Bond v. Polycycle, Inc.) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bond v. Polycycle, Inc., 732 A.2d 970, 127 Md. App. 365, 1999 Md. App. LEXIS 127 (Md. Ct. App. 1999).

Opinion

ADKINS, Judge.

This case is an appeal from an order of the Circuit Court for Baltimore County issued by the Honorable Norris Byrnes against Martin Bond, appellant, in favor of PolyCycle Corporation (PolyCycle), appellee. The trial court found that Bond misappropriated a trade secret and issued an injunction restricting him from disclosing or making use of the technology he developed on behalf of PolyCycle. PolyCycle was also awarded attorneys’ fees. Appellant timely noted this appeal.

Appellant asks us to determine whether the trial court erred in: 1) finding that he violated the Maryland Uniform Trade Secrets Act; 2) concluding, without the appropriate finding of fact, that he usurped a corporate opportunity; 3) ordering him to pay appellee’s counsel fees; and 4) placing an unreasonable restraint on his right to free speech.

For the reasons that follow, we perceive no error and affirm the judgment of the circuit court.

FACTS

Prior to July 1995, George Brown and Marvin Marks were involved in discussions concerning a potential investment in Antaeus Group, Inc. (Antaeus). Later, Brown and Marks approached appellant, an engineer, and asked him to review a technology patented by Antaeus, which separated toxins from medical waste. It was Brown and Marks’s idea that the same technology could be used to remove paint and other adherents from plastic in a way that would be non-destructive to the plastic. In essence, the process broke the plastic into small pieces and applied a combination of heat and agitation to break the bond between the paint adherent and the plastic, without changing the physical or chemical properties of the plastic. In exchange for Bond’s review of the technology, *369 Brown and Marks offered him a share of a proposed joint venture to license and commercialize the technology.

Appellant reviewed the technology and concluded that it had great economic potential. As a result, Bond, Brown, and Marks formed PolyCycle in 1995 “[t]o engage in the business of designing and manufacturing equipment for use in the separation of adherent foreign matter from solid materials, including the separation of paint from plastic resins and providing the use of such equipment as a service to others” In exchange for a license to use the Antaeus process and common stock in Antaeus, PolyCycle paid Antaeus $700,000 and agreed to pay it future royalties.

Bond was named the president of PolyCycle and was responsible for the daily operations of the company. Brown was responsible for accounting, while Marks performed marketing and consulting services. It was agreed that no one would receive compensation for his work. Bond estimated that the development of the technology would take up to six months and cost approximately $75,000 to $100,000.

Bond began to undertake the development and improvement of the Antaeus technology. After renting space for the business, and purchasing equipment and supplies, Bond determined that the Antaeus technology was not suitable for Poly-Cycle’s needs without modification. One problem with the existing apparatus was that it did not recycle the water used in the process. Therefore, Bond added a hydrocyclone to the machine to recycle the water. Secondly, to improve the process, Bond replaced the Vaughan chopping pump with a Dicon mixing pump. Lastly, Bond modified the pressure vessels on the equipment to further aid the process.

In addition to modifying the equipment, Bond sought customers for PolyCycle. Specifically, Bond targeted the automobile industry. When Bond discussed the technology with potential customers, he required that they sign a confidentiality agreement, which stated that the technology belonged to PolyCycle.

*370 As a result of a delay of more than two years and costs of approximately $500,000, meetings were held to review PolyCycle’s progress. At one of these meetings, Bond requested a salary for his efforts, but Brown and Marks declined the request, citing PolyCycle’s failure to generate a profit. Bond then consulted with an attorney and sought assistance in negotiating a compensation package. Bond’s subsequent compensation demand upon PolyCycle merely resulted in further estrangement of the parties.

Bond also sought legal advice on whether his improvements to the technology were patentable. After conferring with his attorney, Bond believed that his modified process was not sufficiently different from the existing technology to warrant a patent. He testified, however, that he believed based on his attorneys’ advice, that he was entitled to use any modifications of the Antaeus technology for which he was responsible, but that PolyCycle might have the right to use his modifications.

On September 23, 1997, Bond, through counsel, wrote to Marks and Brown and informed them that he had determined that the Antaeus technology was not commercially viable, but that he had developed an alternative technology that he believed was economically viable. Bond further stated that this alternative technology did not belong to PolyCycle, and contended that it belonged to him. The next day, on September 24, 1997, Bond resigned from PolyCycle as a director and officer. When Bond left, he took all of the technology with him, including computer files, papers, and records pertaining to the technology. In addition to taking the computer files, he deleted the files from PolyCycle’s computers. In response, PolyCycle brought this suit, seeking to compel the return of, and restrict the use of, such information.

DISCUSSION

Appellant contends that the trial court erred in finding that he willfully and maliciously violated the MUTSA. He also contends that the court placed an impermissible prior re *371 straint on his right to free speech. Appellee asserts that the trial court did not err in its findings. We agree with appellee.

In reviewing the trial court’s decision on the evidence, this Court will not reverse unless the decision was clearly erroneous. See Md. Rule 8-131(c). Maryland Rule 8-131(c) provides:

When an action has been tried without a jury, the appellate court will review the case on both the law and the evidence. It will not set aside the judgment of the trial court on the evidence unless clearly erroneous, and will give due regard to the opportunity of the trial court to judge the credibility of the witnesses.

See also Operations Research, Inc. v. Davidson & Talbird, Inc., 241 Md. 550, 556, 217 A.2d 375 (1966).

1.

Maryland Trade Secrets Act

The Maryland Uniform Trade Secrets Act (MUTSA) defines a trade secret as:

[Ijnformation, including a formula, pattern, compilation, program, device, method, technique, or process, that:
(1) Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and

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732 A.2d 970, 127 Md. App. 365, 1999 Md. App. LEXIS 127, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bond-v-polycycle-inc-mdctspecapp-1999.