John E. Droeger v. Welsh Sporting Goods Corporation, a Corporation

In this diversity action, Welsh Sporting Goods Corporation appeals the judgment entered after a jury found that Welsh had misappropriated a trade secret owned by John E. Droeger. We reverse.

In 1970, Droeger wrote an unsolicited letter to Welsh concerning Droeger’s patented design for luggage convertible to a backpack. In early June, 1970, Welsh’s sales representative, Warren M. Bayley, met with Droeger to discuss the patented device. At that same meeting, Droeger sketched for Bayley a second type of luggage that was also convertible to a backpack. This second concept, known as the “Russian design”, was not original with Droeger.

Subsequent to the June meeting, Bayley wrote Droeger that “any and all descriptions, information, and naturally patents will be held in the strictest confidence.” Thereafter, Droeger sent a letter to Bayley with two sketches. One sketch showed the Russian design plus an improved version of that design conceived by Droeger. The other sketch showed Droeger’s “improved Russian design” could be applied to an existing Welsh product. In the accompanying letter, Droeger described his improvements, which included alteration of the carrying handle and the use of…