Leslie F. Keeley Co. v. Hargreaves

86 N.E. 132, 236 Ill. 316
CourtIllinois Supreme Court
DecidedOctober 26, 1908
StatusPublished
Cited by8 cases

This text of 86 N.E. 132 (Leslie F. Keeley Co. v. Hargreaves) is published on Counsel Stack Legal Research, covering Illinois Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Leslie F. Keeley Co. v. Hargreaves, 86 N.E. 132, 236 Ill. 316 (Ill. 1908).

Opinion

Mr. Justice Dunn

delivered the opinion of the court:

This appeal is from a decree making perpetual an injunction against the defendants in a bill filed by the appellee, the Leslie E. Keeley Company, against Frederick B. Hargreaves, the Fred. B. Hargreaves Company, and others.

The bill alleged the incorporation of the complainant under the laws of Illinois, having its principal place of business at Dwight, in Livingston county; that Leslie E. Keeley, a practicing physician, about 1880 discovered a new remedy for drunkenness and similar diseases and began to administer the same; that about 1881, for the purpose of carrying on and developing the business in connection with said remedies, a partnership was formed between the said Keeley and Curtis J. Judd, Frederick B. Hargreaves, John R. Oughton and James Halpin, with written articles of co-partnership, whereby it was, among other things, expressly provided that each member of the firm should jealously guard all information pertaining to the compounding of said remedies, their constituent parts and elements, and should under no consideration divulge any information whatever concerning their manufacture to anyone; that if any partner should so impart any of said information his connection with said business should immediately determine; that if any partner sold his interest he agreed to keep secret all his knowledge of and concerning the nature and manufacture of said remedies, and not to divulge any of such knowledge to anyone whatsoever without the written consent of all of the then surviving partners; that to the said Oughton, as a pharmacist, was confided the preparation and ingredients of the secret remedies, and the secret was imparted to him by Keeley, as a secret and confidential communication, for that purpose; that the remedies were administered to a large number of patients, the treatment became very successful and the remedies acquired a great reputation; that about March 20, 1886, the connection of the said Frederick B. Hargreaves with the partnership was severed, and for a valuable consideration he by an instrument in writing sold all his interest (except the accounts, notes, two deeds and one mortgage,) in the said partnership to the said Judd for the use of the remaining members; that afterwards, by two certain instruments in writing, the first about January 7 and the second about September 26, 1887, he sold to the Leslie E. Keeley Company all his interest in the matters excepted from the first transfer; that about March 25, 1886, Halpin sold his interest to the remaining partners; that about April 3, 1886, the complainant corporation was duly incorporated, and Keeley, Judd and Oughton, the sole remaining partners, became the sole subscribers to its capital stock, and in payment therefor gave over and sold to the corporation the entire assets, good will and business of the co-partnership, together with the right to make, administer and sell the said secret remedies discovered by Keeley; that complainant continued the business, which grew rapidly and is of great value to the complainant; that the objects for which the corporation was formed were enlarged, branch institutes were established at various places, and the secret remedies were sold by complainant to them and administered there by skilled physicians instructed under the direction of Keeley during his lifetime and since his death by other physicians instructed by him or by others in complainant’s' employ; that the complainant became the owner of certain real estate described in the bill; that Keeley died February’21, 1900, and since his death the medical direction of the business has been supervised and the administration of the secret remedies directed by physicians regularly licensed and instructed in the administration of the said remedies; that from the time of the discovery the secret of the remedies has been jealously and carefully guarded, and,’ aside from the good will, is the chief and most valuable asset of the complainant, and if it should be made public the business of the complainant would be destroyed; that Frederick B. Hargreaves has given out that he knows the secret of the remedies as prepared by Keeley and by the co-partnership, and became so acquainted with it while associated with Keeley and a member of the co-partnership ; that defendants have entered into a conspiracy wrongfully to use said Hargreaves’ alleged knowledge of the secret remedies, and to that end have formed a corporation to sell and administer such remedies; that said Hargreaves is to disclose his alleged knowledge of the secret remedies, and proposes to sell to defendant company remedies made in accordance with the secret formulas used by Keeley, the partnership and complainant, the knowledge of which he claims to have; that defendant company proposes to purchase of said Hargreaves such remedies and to sell and administer the same; that said Hargreaves has contracted to give the company his exclusive services in the preparation of such remedies, the knowledge of which he gained, if he possesses it, while associated with Keeley and the co-partnership; that defendants are about to open at Dwight an institution for the preparation and administra^tion of such remedies compounded under said Hargreaves’ direction, and to offer and sell such remedies to others and to so-called Keeley Institutes at a lower price than sold by complainant; that said Hargreaves and wife, in pursuance of said conspiracy, have conveyed to Williám H. Ketcham an undivided interest in certain property now owned by the complainant, which constitutes a cloud on the complainant’s title; that the defendants pretend that said Hargreaves has some interest in complainant’s business, and is at liberty to sell the secret acquired while associated with Keeley and to prepare and sell remedies compounded in accordance with the secret formulae used by Keeley, but complainant alleges that if said Hargreaves does know the secret formula, or has any material knowledge of it, he obtained it wholly through his confidential relations with Keeley and by reason of his being a co-partner, and would therefore, after having sold his interest in the co-partnership, be debarred, in equity and good conscience, from ever thereafter using the same for his own benefit or the benefit of any other person than complainant.

The bill prays for an injunction restraining the said Frederick B. Hargreaves from disclosing to his co-defendants, or any other person, any knowledge acquired, directly or indirectly, from the said Keeley, or by reason of Hargreaves’ membership in the said co-partnership, as to the composition, formulae or methods of compounding the said remedies, and from making remedies in accordance with the knowledge derived, directly or indirectly, from the said Keeley or while a member of said partnership, or from advertising that he will make such remedies, and restraining the other defendants from selling or administering such remedies and from disclosing any -information which they may have derived from Hargreaves in regard to them; also restraining Ketcham from setting up any claim, by virtue of the deed from the said Frederick B. Hargreaves to him, to the real estate therein described, and restraining both Ketcham and Hargreaves from making any conveyance of any interest therein, and for a decree that the conveyance from said Hargreaves to Ketcham of the said real estate be set aside as a cloud upon the complainant’s title.

Separate answers were filed by the various defendants putting in issue the allegations of the bill. The claim, of the defendants is, that the discovery of the remedies mentioned in the bill was not made by Dr.

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Bluebook (online)
86 N.E. 132, 236 Ill. 316, Counsel Stack Legal Research, https://law.counselstack.com/opinion/leslie-f-keeley-co-v-hargreaves-ill-1908.