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CERTIFIED LABS. OF TEXAS, INC. v. RUBINSON

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA


September 10, 1969

CERTIFIED LABORATORIES OF TEXAS, INC., National Chemsearch Corporation of New York, Inc., and Dyna Systems, Inc.
v.
Alan RUBINSON, Robert W. Lowery, Jay Griffith, Herb Kress and Malter International Corp.

The opinion of the court was delivered by: LORD, III

JOSEPH S. LORD, III, District Judge.

 This action is brought by three corporations engaged in selling products known as chemical specialties against four former salesmen for breach of various covenants ancillary to their employment and for misuse of trade secrets; against these same defendants and a corporate competitor for inducing the breach of these covenants; and against all defendants for conspiracy to commit the aforementioned contractual breaches and torts. Plaintiffs seek equitable relief as well as money damages.

 Jurisdiction is based upon diversity of citizenship and the requisite jurisdictional amount. 28 U.S.C. ยง 1332.

 I. FINDINGS OF FACT

 1. Plaintiffs, Certified Laboratories of Texas, Inc. ("Certified"), National Chemsearch Corporation of New York, Inc. ("Chemsearch"), and Dyna Systems, Inc. ("Dyna Systems"), are affiliated Texas corporations with their principal places of business in Dallas, Texas.

 2. The individual defendants, Alan Rubinson ("Rubinson"), Robert W. Lowery ("Lowery"), Jay Griffith ("Griffith"), and Herb Kress ("Kress") reside in and are citizens of the Commonwealth of Pennsylvania.

 3. The corporate defendant, Malter International Corp. ("Malter"), is a Louisiana corporation with its principal place of business in Gretna, Louisiana.

 4. The amount in controversy against each defendant exceeds $10,000 exclusive of interest and costs.

 5. For many years plaintiffs Certified and Chemsearch and their predecessors have been engaged in the business of selling and distributing disinfectants, soaps, detergents, cleaners, chemical specialties, insecticides, paints, water treatments, maintenance chemicals, adhesives, glues, paper products for industry and institutions, degreasers, sanitary supply and floor maintenance materials and equipment and related products in Pennsylvania and throughout the United States.

 6. Plaintiff Dyna Systems is engaged in the business of selling and distributing a number of the kinds of products described in the immediately preceding paragraph as well as fasteners, lubricants, engine additives, electric terminals, connectors, and washing, degreasing, lubricating and chemical application equipment in Pennsylvania and throughout the United States.

 7. Plaintiffs Certified, Chemsearch and Dyna Systems and defendant Malter are engaged in what is known as the chemical specialties, maintenance, chemical and sanitary supply business. The products which they merchandise perform generally similar functions and are competitive.

 8. The chemical specialties industry is a highly competitive business in which basically identical maintenance and sanitation preparations are marketed through aggressive, door-to-door sales programs to bulk consumers, principally commercial, industrial and institutional users.

 9. The marketing technique employed by plaintiffs and defendant Malter, and generally employed by their competitors, is to engage a large sales force in the field, canvassing aggressively and distributing novelty gifts to secure entry to the customer and to stimulate repeat business.

 10. Plaintiffs have invested in and have developed programs of recruiting and training salesmen, including aptitude tests, interviews, study, training guides and materials, training in the field, periodic reports to sales managers and analyses of such salesmen's work, product guides, demonstration kits and training in connection therewith, as well as periodic sales and training meetings, and periodic issuance of new training material. 11. The individual defendants made application for employment with the plaintiffs and were hired by plaintiffs at the following times: Rubinson Certified 12/3/64 Lowery Certified 5/17/67 Griffith Chemsearch 6/28/68 Dyna Systems 1/28/69 Kress Chemsearch 2/8/65 Dyna Systems 1/28/69

19690910

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