Fremont Oil Co. v. Marathon Oil Co.

92 Ohio Law. Abs. 76
CourtSandusky County Court of Common Pleas
DecidedJuly 1, 1962
DocketNo. 33204
StatusPublished
Cited by3 cases

This text of 92 Ohio Law. Abs. 76 (Fremont Oil Co. v. Marathon Oil Co.) is published on Counsel Stack Legal Research, covering Sandusky County Court of Common Pleas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fremont Oil Co. v. Marathon Oil Co., 92 Ohio Law. Abs. 76 (Ohio Super. Ct. 1962).

Opinion

Gabel, J.

This matter comes on to be heard on the pleadings, the evidence and the briefs of counsel.

Basically, this is a suit alleging a conspiracy on the part of all the defendants to commit certain acts of unfair competition, and plaintiff prays for a permanent injunction, accounting of profits, cancellation of distributorship contracts between Marathon Oil and the individual defendants and such other equitable relief as plaintiff may be entitled to in the premises.

Defendants generally deny the actionable charges made by the petition.

The individual defendants were for the most part, long time employees of Fremont Oil Company. Robert E. Mehling, eight years; Urban Miller, eighteen and a half years; Kenneth Ohms, seven and a half years; Edward T. Hallier, twenty-seven years; Louis M. Dolweck, six years; Ken L. Hirt, one and one-half years.

Miller, Ohms, Hallier, Dolweck and Hirt, the last named on a part time basis, were tank truck drivers for Fremont Oil Company serving approximately twelve hundred customers with petroleum products with special emphasis on gasoline and fuel [80]*80oil. Mehling, in addition to other general duties, was the route supervisor and liaison representative between the drivers and the management. None of the drivers had entered into a restrictive contract forbidding them to compete territorially or otherwise upon termination of employment with Fremont Oil.

Prior to October 1, 1962, the stock of Fremont Oil was apparently wholly owned by Harold Gabel and John Lehmann, or members of their immediate families. On October 1, 1962, Fremont Oil became a wholly owned subsidiary of Standard Oil of Ohio. Shortly thereafter, Russell G. Mantz, the new manager, called a meeting of all the employees and assured them as to job security and indicated there would be merit raises when warranted. It is interesting to note from the testimony of the tank truck drivers, that they had received no pay raise for a period of from three to five years under the previous management. However, probably encouraged by the statement of Mr. Mantz that there would be merit raises when warranted and disappointed that raises were not promptly forthcoming, the drivers and Ed Miesle, the latter not a party to this suit, sometime early in December of 1962, met at the Ohms residence primarily to discuss a pay raise. It was agreed they would stick together, make their demand as a group, but would postpone any request for a raise until after Christmas so as not to jeopardize the payment of an anticipated Christmas bonus.

Thereafter, Ed Miesle without waiting for group action, requested a pay raise and got it promptly. He was never invited to attend any further group meetings.

The next meeting was held either late in December or early in January 1963, at the home of Urban Miller. Robert Mehling either asked or was invited to attend this meeting and was accompanied by his father-in-law John Lehmann, one of the former major stockholders of the Fremont Oil Company. As a leverage to use with Fremont Oil, it was suggested to the drivers at this meeting that they contact another oil company. This was agreed upon and it was also agreed that Mehling would represent the group in any negotiations with another company. It is quite obvious from the testimony of all the individual defendants that from and after the meeting at the Miller home, [81]*81no further thought was given to making any demand for any wage adjustment with Fremont Oil.

From and after this meeting, all approaches, contacts and negotiations with Marathon, were carried forward for and on behalf of the drivers by Mehling until the meeting of the drivers with representatives of Marathon at Holiday Inn on January 28th.

In accordance with the agreement reached at the meeting at the Miller home, Mehling sought out representatives of Marathon and began negotiations for employment for the entire group. As a result of prolonged negotiations beginning early in January 1963 and after Mehling had had at least ten contacts or meetings with Marathon representatives, on February 7, 1963, Mehling signed a contract with Marathon as a Class A distributor, and Miller, Hallier, Ohms and Dolweck, signed contracts with Marathon as Class B distributors.

It must be noted that all of these negotiations and meetings between Mehling and/or the drivers with Marathon, occurred while the group were still trusted employees of Fremont Oil and without the knowledge of Fremont Oil.

After signing the distributorship contracts on February 7, the drivers, or Mr. Mehling, had a total of thirteen more meetings with representatives of Marathon while still employees of Fremont Oil.

Before leaving Fremont’s employ and in furtherance of their objectives, the drivers or their representative, Mr. Mehling, with the knowledge and tacit consent of Marathon, (1) kept their intentions a complete secret; (2) agreed to resign en masse without notice on March 4, 1963, by leaving a note on Ron Miller’s desk at Fremont Oil in the following language.

“Ron, sorry we had to go this way. We are all with Marathon Oil Company. Goodbye for now and good luck. We’ll be seeing all of you. Tell all the boys and Russ.

(Signed) Urb, Eddie, Louis, Ken,

Zeke, Ken Hirt”

(Plaintiff’s Exhibit No. 22)

(3) gave Marathon complete customer lists torn from Fremont Oil analysis sheets and supplemented from memory by the drivers; (4) gave Marathon full information as to Fremont [82]*82credit policies; (5) gave Marathon information as to quantity discounts and special price discounts enjoyed by preferred customers of Fremont Oil; (6) began soliciting some of Fremont Oil customers to switch to Marathon. This was done by all of the drivers and by Mehling as well, as evidenced by the testimony of each of them. (7) disclosed to Marathon, Fremont Oil’s method of computing sealed public agency bids; (8) disclosed to Marathon customer gallonage figures and equipment located at consumer and re-seller accounts; (9) upon leaving, took keys to Fremont Oil customer tanks; (10) prior to leaving, took all route lists from Fremont Oil vault; (11) took trailer court list; (12) removed from office of Fremont Oil and destroyed 4 re-seller contracts.

All of the foregoing are facts fully substantiated by the evidence.

Apparently, these employees had no feeling of obligation or duty to their employer, and had no realization that in good morals as well as under the mandate of the law, they were required to be faithful in their employment and to refrain from engaging in practices harmful to the interests of their employer. On this score see 35 Ohio Jurisprudence (2d), 700, Section 78, wherein it is stated as follows:

“The employee is bound to the utmost good faith toward his employer and to be loyal and faithful to his interests and to not act in antagonism or serve a private interest of his own in opposition thereto.”
í < There is an implied agreement on the part of the employee that he will faithfully serve and be regardful of the interests of his employer during the term of his service and carefully discharge his duty to the extent reasonably implied by the relation of employer and employee.”

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Related

Standard Oil Co. v. Landmark Farm Bureau Cooperative
369 N.E.2d 785 (Ohio Court of Appeals, 1976)
H. J. Sherwood, Inc. v. Fibeco, Inc.
234 N.E.2d 531 (Cuyahoga County Common Pleas Court, 1967)

Cite This Page — Counsel Stack

Bluebook (online)
92 Ohio Law. Abs. 76, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fremont-oil-co-v-marathon-oil-co-ohctcomplsandus-1962.