Aktiebolaget Bofors v. United States (Two Cases). Aktiebolaget Bofors v. Acheson, Secretary of State
194 F.2d 145
D.C. Cir.
1951
Check Treatment

*2 CLARK, Before WILBUR K. MILLER FAHY, Judges. Circuit MILLER, WILBUR K. Judge. Circuit appellant, Aktiebolaget Bofors, insti- tuted these three actions in the United Court for States District April 17, Columbia on three All complaints, contained substantially allegations similar factual and had the objective, secret, general same dismissed unlicensed were trade followed. judge, appeals these the trial its claim extra submit provided contract. arbitration as allegations summarize the We *3 equitable ad- When all obtain efforts to an Bofors, corporation complaints. a Swedish justment through negotiation informal mu- selling and engaged manufacturing proved fruitless, Bofors addressed to nitions, unpatented owner was the of an State, Defense, and Army Secretaries of process by pro- the use it secret of which Navy styled a formal document “Petition apparent- gun, duced a 40mm anti-aircraft Action,” Agency for a full contained ly superior Navy De- excellence. The requested and again statement of the facts partment to ac- of the United States desired agree officials grant that those to either quire Negotiations the Bofors secret. for unauthorized use 1941, 21, in a contract dated resulted dispute trade secret or to submit to ar- granted the terms of which Bofors to petition The bitration. for agency Department, consideration rejected by Secretaries, all after four dollars, an hundred thousand sum six which Bofors filed the now three actions make, and license to irrevocable “Exclusive before us. in the and have made United States use 40mm use” the Bofors United States 10870, 1. No. Bofors United States. v. use, the Bofors gun for naval water-cooled action, alleged tort, to sound in use, types gun army all air-cooled 40mm damages in the sum two million dollars. therefor, the Bofors and ammunition The moved to on two government dismiss carriage Bofors guns. field for 40mm grounds: complaint (a). that the to failed agreed secret to make full disclosure its upon state a cause which relief two process and to furnish the services granted, (to) could and that the court expert production engineers period for a jurisdiction subject was without over the year. of one The District order of matter. Court’s money paid, deliv and Bofors The expressly grounds dismissal both sustained to the Attache at ered Naval the American of the motion. speci Legation plans, in Stockholm all We first examine the to see fications, and manufacturing drawings whether it states upon a cause of action our engineering necessary data to enable granted. which relief can be plead- Bofors guns ammuni people to manufacture ed that the arose under the Federal process. Bofors tion secret Act, 28 1346(b), Tort Claims U.S.C. so § use began immediately inquiry allega- the initial is whether the so also the trade secret revealed to it and tions described a tort. transfer, under Lease

began to the Lend guns legislation, Act* and similar Bofors unpatented The owner of an to>other to be used ammunition nations property right trade secret it Ger common war them right not long as does disclose it. His Japan. many and depends use of it the exclusive secrecy. Any person continuance of who be- regarded such transfers as theft, obtains the secret from brib yona scope which it him license ery, stealth, breach of a Be- confidential re granted, protested vigorously. lation or unlawful means violates his continuing throughout other ginning in 1941 property informally right and commits a tort.1 As years, succeeding it several Judge opinion in his ei- Holtzoff said the American authorities importuned case, intact, royalty long “So the secret remains arrangement out ther work * 891; Peabody 887, seq. 268 F. et E.D.Pa. 22 411 U.S.C.A. 452; Norfolk, 98 Mass. Radium Reme- v. Corp. v. Smith Petroleum Iron A. O. Weiss, dies v. Minn. Co. Co., Cir., 1934, Works 73 F.2d 339; Pressed Steel Car N.W. Co. 536-539; Booth v. Stutz Motor Car Co. Co., Standard Steel Car 210 Pa. 962; America, Cir., 1932, 56 F.2d A. 4. Mfg. Co., Noxall Polish Feasel v. D.C. * ** any it, guilty one invades arising who of a out interference with

tortious act.” rights.” wrongful The tort lies in the Even though a tort claim was acquisition. But one ac lawfully who has complaint, stated in the de we should quired may a trade secret it in any termine any whether allegations its up set acquired liability manner without unless he action, label plaintiff to a contractual limitation applies pleading does not restriction as to its event use. In that a determine the nature of the cause of action for purposes licensee who uses secret which he states. Bofors’ denomination *4 beyond scope granted the of the license its suit arising as one under the Federal by the owner is liable breach of con Tort Claims Act was which a conclusion tort, tract, no the he commits because but does prevent recogniz not the from thereby only right of the owner which he ing any other form of the claim which by agreement complaint invades is one created the described. the According to of owner disclosure. The could not allegations here, main acquired' the United States aris damages tain a him for suit the subject trade secret the to' contractual ing use without plead from unlicensed make, limitation “to in use have made ing being proving the contract. the United the States for States United gist true, of the is the the owner’s action use” the therein devices If the described. agreement.4 of the licensing United process States used in the secret manufacturing guns and ammunition for Department acquired the the Here by nations, use other alleged, Subsequent lawfully. unauthorized secret 1941, agreement it 21, violated the of therefore, was, by use the June and, consequently, complaint the stated complaint the not follows that tortious. It a cause of action for breach of contract.5 did not state a cause in case No. may alleged It the be that gov action of Moreover, our 28 U.S.C. in tort. making upon ernment in unauthorized excepts from those claims use the 2680(h) may morally justified under trade secret government by be sued was which the ex the “Any claim war, Harry Claims Act igencies Tort L. Hopkins sugg the Federal 3. Section which is it in may rather proper him a breach trade proper only mitted so, (1939), D.C.D.D.C.1950, In the Comment “(a) “(b) “ “ “One who third * find the * * rule stated % ato * * his liable to the secret, * means to his disclosure means, other than permitted to use the secret is in persons. * * manufacturing may be duty discovered % following (pp. It a manufacturer who discloses part the mere basis confidence without owner or not in this Section. is the procure disclosing as follows: other [*] to disclose the secret theOr following the section Restatement, of the F.Supp. employment or use constitutes the secret or copying if reposed privilege uses [*] liability 3—1 the secret to manufacturer secret trade 131, another’s or in him by secret, to use [*] under to do Torts 8-9): per- only use, 133. im- im- 4. Whittaker v. 5. The . .others.” Bofors. were, in the sentence The reason manufacturing plain in tbe manufacture of 25 N.W. 632. nations tion has little force. the within transferring secret or use it products on bis own account or for States use” would against common enemies. The conten secret States was owner, government enough: nations, tbe witb course, the United States for “using” meaning bad intended it their use in Collins, 1885, equipment which duty our to allied and associated argues potential not have been tbe Bofors use of allies and words tbe manufacture of not to granted of the If products that for the use of those words is the to 34 Minn. customers waging “for disclose tbe disclose tbe tbe United license parties equipment associates inserted for tbe license United use in waf Secretary Navy, a declara- the and the seeks alleged refusal but the ested;6 the con- tion of rights the United of Bofors military and naval authorities 1941,including tract of determina- arbitrate the to discuss States for its vio- damages tion or arbitration of unauthorized for such compensation not were As the four Secretaries be borne lation. should It justification. use no per- parties were was to the contract and not of the purpose that the mind therein, appellant’s sonally interested trade of the prevent unlicensed not to prayer clearly di- declaratory relief Hopkins thought ought secret, which sovereign, was not made rected at the done, to be but obtain Consequently,the com- party defendant. beyond the past and use of the secret future plaint properly dismissed. Larson v. grant had been scope license Corpora- Foreign & Commerce complaint Domestic is that the ed. conclusion Our stated, tion, 1949, 337 U.S. S.Ct. cause of No. 10870 case L.Ed. The District Court for breach of contract. based its order dis erred insofar as urges, however, Appellant ground that the missal *5 Act, of10 the Administrative Procedure § upon cause action did not state a the government’s 5 waives U.S.C. § granted.7 be could .relief permits immunity from suit and this action the decide whether It remains to by providing in subsec against the officers jurisdiction Court had of the cause legal person “Any suffering that (a) tion of action for breach of contract set forth ** agency any wrong action because complaint. in the That court concur to thereof.” judicial shall be entitled review of Claims jurisdiction rent with Court the Ad recently We said that 10 have § against for of an action the States United not extend ministrative Procedure Act does damages when for of contract the breach jurisdiction any cases not the court to amount claimed does not exceed ten thou competence. Almore otherwise its within dollars, 1346(a) (2); sand but 28 U.S.C. § Pace, 1951, 193 F. U.S.App.D.C.-, sought, when a Court greater sum is the Moreover, 2d that subsection note jurisdiction, Claims alone has U.S.C. * * * provides “Every final (c) that hold that the District Court 1491. We § agency for which there no action complaint in was correct the dismissing any remedy court adequate shall be sub- of action case No. 10870'because the cause ject judicial review.” As we said to have for of contract is not therein stated appellant heretofore, the could have sued in jurisdiction within the of that court. damages Court of the Claims for breach adequate remedy the contract. Thus an Acheson, 2. No. Bofors v. prevents Tucker afforded the Act Bofors Secretary of State et al. This action relying on from the Administrative State, Secretary the Secre Procedure Act. tary Defense, Secretary Army qualify did following letter, 7. The order limit 6. The written Mr. ground saying Hopkins of dismissal representative, com- to a Bofors was upon plaint a Judge did cause of not state action in a shown footnote to Holtzoff’s granted by relief could be Dis- opinion, F.Supp. 131, 132. He de- broadly Court; trict said a “picturesque,” cause it as but obvi- scribed ously upon was not stated action which relief his did not base order of dismissal granted, assigned enjoin it, then upon could did not to Bofors seek ground second for dismissal a the court’s use: (cid:127)unlicensed jurisdiction. Thus your lack of the effect of “I have letter of December separately (a) Army was to hold telling the order me tell the to to stated, stop guns no cause of was manufacturing that Bofors jurisdic- (b) that without use of the United Nations in the defeat Germany Japan. over the matter. have tion We grounds only say considered both you “I therefore I if can that trial you recited court’s dismissal what are who asked me do client your asking order. Government to do X should jump tell him lake.” Bofors v. United No. declaratory judg States. except that similar to No. ment is defendant.

here the United States is the sole sought gov that the declaration ' contract, and ernment had violated the required

prayed appropriate that officialsbe agree or arbitrate

damages. already

We have determined does not state Although suit tort. denominated a readily

declaratory judgment, the action reality

seen to be in for breach of contract 10870, which we first

like No. discussed.

It, too, jurisdiction beyond the

District Court the Tucker Act.

Affirmed.

FAHY, Judge. Circuit concur in the result. In No.

I

however, think we should leave to I *6 having jurisdiction contract

issue the whether or not

of action for stated. UNITED STATES.

KELLY v.

No. 10639. Appeals Court Columbia Circuit. District of

Argued April 16, 1951. 10, 1952.

Decided Jan.