31 N.Y.S. 696 | N.Y. Sup. Ct. | 1894
This controversy relates to the ownership of and right to use a secret or unpatented process for manufacturing tobacco flavors, and to certain trade-marks and brands, used in the
“I have just come from 53 Broadway, and am very much annoyed to report we rec’d to-day 90 gal. order from Stern Bros., Chicago. What ails these d-— Jews? Did you not send them a circular? I have also other news to report. The inclosed is a copy of a letter from B. Bros. & Co., lawyers, to H. P. B., upon the propriety of suing out an injunction upon us. I am going there to-morrow, probably, but I am of the opinion, when I am through, there will be no injunction, I am quite sure.”
The day following, November 15th, Seymour advised what plaintiffs’ traveling salesman was doing. The next day he informed Von Micheroux that there might be danger that Marburg, one of plaintiffs’ oldest customers, would send an order to Baldwin Bros. & Co. instead of defendants. In the letter of November 19th to Von Micheroux, Seymour says, among other things:
“We have got them tight, I think, beyond all doubt. They don’t dare to attempt such a thing. Baird [the plaintiffs’ traveler], as I wrote you, went out over the N. Y. Central road, but so far has sold nothing. Only one letter from him since Monday, and no report of work beyond Albany. * * * They will have to discharge him, and toy it again, which will probably take the wind out of their sails, and all the fight out of them as well. From what I hear, the latter is pretty well squeezed out of them now. On Monday I am to see Guthrie, and you bet I will feel pretty independent. I know where I stand better than they do. * * * They are dying fast, much faster even than Itoberts, and I hardly think six months will see them in the ‘biz.’ If we hold Finzer and your old trade, they won’t last even that long after I leave.”
From the letter of November 22d we take the following:
“But we doubt it. Of course, they may be foolish enough to do so. No one can tell what fools may do. * * * Please, in all first orders, don’t fail to*699 give prices, terms, etc., as soon it will be impossible for writer to have access to B. B. Co.’s to get these particulars. * * * No orders at 53.”
These letters fairly indicate the general character of those received by the court, which defendants insist were immaterial. That Von Micheroux was as blameworthy as the other two defendants appears from his letters generally, and particularly in one of November 15,1892, immediately after the order from Chicago, of which Seymour complains in his letter of November 14th. He writes:
“I think we better send at once our trade-mark to Washington, and have it registered. I think you better communicate with Mr. Seymour at once, and that he shall attend to it at once without delay. Am sorry to see the •order from Chicago in our enemy’s hands, but of course it cannot be helped for the present. By New Year’s all the agony will be at an end. All the trade has received our circulars. Nothing more to state. I am, dear sirs.”
Of course, it is not pretended by the appellants that these letters did not show unlawful conduct on the part of Seymour, but they insist that they could in no way affect the defendants Boulger and Von Micheroux, because they were not, like Seymour, a partner in the firm of Baldwin Bros. & Co., but merely employés, and so could leave the business at any time, and engage in business on their own account. .That Seymour’s conduct was of such a character as would cause a court of equity to restrain him from committing further frauds of the character described in the letters written by him, and charge him with the damages resulting from the fraudulent acts already committed, is so well established as not to require citation of authority. The reason for it is well stated in Holmes v. Gilman, 138 N. Y. 369, 34 N. E. 205. At page 377, 138 N. Y., and page 206, 34 N. E., the court said:
“That a partner occupier a fiduciary position with regard to his copartners and the funds of the firm, and will not be permitted to make a personal profit out of the use of such funds, is, I think, clearly established. * * * Although partners do not, in the strict sense of the term, occupy the position of trustees towards each other and towards the firm funds, yet the position is one of a fiduciary nature, calling for the maintenance and exercise of the greatest good faith between them. Such a relationship authorizes the same remedy on behalf of the wronged partner as would exist against a ‘trustee,’ strictly so called, on behalf of a cestui que trust.”
Now, while Von Micheroux and Boulger were not partners of Baldwin Bros. & Co., and did not stand in a fiduciary relation to plaintiffs, still they were co-operating with Seymour in his efforts to perpetrate a fraud upon his partners, with full knowledge on their part that such was his intent, and that it was all to be done in order that they, as well as Seymour, should profit at the expense of Baldwin Bros. & Co. The court had the power to restrain them, as well as Seymour, from either further proceeding with or consummating such illegal scheme. For the damages sustained by plaintiffs because of Seymour’s conduct, the other defendants were participants, and likewise chargeable. This proposition is supported by Emery v. Parrott, 107 Mass. 95. We quote, as especially applicable to the facts of this case, from the opinion, as follows:
“The caso of the defendant Head stands somewhat differently, but is governed by the same general principles. He did' not stand in any fiduciary rela*700 tion.to the plaintiffs. But be knew the position of Parrott, and became the partner of Parrott, uniting with him to effect a sale of the property to Parrott and the plaintiffs, for the sake of dividing with Parrott the secret commission which the owner of the property had agreed to pay for effecting the sale. He was thus fully cognizant of the illegal conduct of Parrott, and co-operated with him in inducing the plaintiffs to make the purchase. He participated in the profits of the transaction; and the court are of opinion that he, as well as Parrott, must disgorge the secret gain which they thus-jointly obtained and divided with each other.”
If this position be well taken, it follows that evidence tending to show knowledge on the part of Von Micheroux and Boulger of the fraudulent practices in which Seymour was engaged for their mutual benefit was properly admissible against them. Such was the purport of these letters. We have not, of course, referred to all of them, but to enough at least to point out that from day today Seymour was putting them in possession of accurate information touching the steps being taken by him to mislead and defraud, his partners. The letters were all of the same general character, and they had the effect to inform the defendants Boulger and Von Micheroux of substantially everything that was being done by Seymour which was in violation of the relation existing between him- and the other members of the firm of Baldwin Bros. & Co., and therefore the evidence was immaterial. There were a number of' exceptions taken to the admission of evidence, but we do not think they call for a reversal of the judgment. The judgment should beaifirmed, with costs. All concur.