Tri-Tron International, a Montana Corporation v. A. A. Velto and William Wurz, Etc.

Appellants Velto and Wurz appeal from a judgment entered against them and George Doerner in a nonjury trial in which they were charged, among other things, with improper use of a trade secret and with engaging in a civil conspiracy to improperly utilize the secret.

Factual Background

A brief summary of the facts follows:

By 1967, the appellee, and its predecessor, had developed a device, the purpose of which was to remove scaling from water pipes by an electro-chemical process. Starting in 1968, Velto and Doerner distributed the device in California under contract with appellee using the trade name, DM Associates [DM]. From that time until August, 1970, while DM was acting as a distributor for appellee, the parties were negotiating on the subject of DM purchasing appellee’s enterprise. In August, 1970, when it appeared that the parties were about to close the transaction, a schematic diagram of appellee’s device was given to Doerner and Velto to facilitate their financial negotiations with their banker. Only once in the past had such a diagram been made available. That was in connection with the sale of one of appellee’s units to the City of Los Angeles, the city…