Berolzheimer v. Heil Company

• Decision Date: 08 January 1965
• Docket Number: No. 14614.,14614.
• Citation: 340 F.2d 122
• Parties: Henry BEROLZHEIMER, Plaintiff-Appellant, v. The HEIL COMPANY, a corporation, Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

340 F.2d 122 (1965)

Henry BEROLZHEIMER, Plaintiff-Appellant, v. The HEIL COMPANY, a corporation, Defendant-Appellee.

No. 14614.

United States Court of Appeals Seventh Circuit.

January 8, 1965.

Karl Berolzheimer, James G. Staples, Chicago, Ill., Ross, Hardies, O'Keefe, Babcock & McDugald, Chicago, Ill., Parker & Carter, Chicago, Ill., of counsel, for appellant.

Arthur L. Morsell, Milwaukee, Wis., Edward H. Hickey, Chicago, Ill., Marvin E. Klitsner, Milwaukee, Wis., Foley, Sammond & Lardner, Milwaukee, Wis., Bell, Boyd, Lloyd, Haddad & Burns, Chicago, Ill., of counsel, for appellee.

Before KNOCH, CASTLE, and SWYGERT, Circuit Judges.

KNOCH, Circuit Judge.

Plaintiff-appellant, Henry Berolzheimer, brought this action in the Superior Court of Cook County for injunction, accounting and damages for breach of a confidential disclosure, wrongful appropriation of an allegedly original and novel concept for a refuse collection truck body, and breach of contract. After the case had been removed to the District Court (there was diversity of citizenship), plaintiff amended his complaint to request compulsory assignment of defendant's patent.

The District Judge tried the cause without a jury, made his findings of fact and conclusions of law, which were favorable to the defendant, holding that plaintiff had failed to establish by a preponderance of the evidence that he disclosed any novel concept, design or device to defendant which defendant adopted or appropriated, and entered judgment against plaintiff from which this appeal is taken.

Many of the facts are agreed or uncontroverted. Henry Berolzheimer was employed by the City of Chicago's Department of Streets and Sanitation from 1954 to 1961, as an automotive engineer. His duties included writing specifications for the equipment used by the Department and recommendations for improvements to such equipment.

The Heil Company which manufactures and markets refuse collection equipment, had been a major supplier of such equipment to the City between 1941 and 1948, after which the City preferred to use one of the compacting type of refuse collection truck bodies which appeared on the market between 1948 and 1949 and which were well known in the trade. These used a packing blade to compact as well as load the refuse in the truck body.

About 1953, Heil Co. developed its "Colectomatic" which required the operator to load the hopper with one batch at a time. Each batch was removed from the hopper by the packer plate and forced into the truck body. The Colectomatic was a rear loader, a type available on the market prior to April 10, 1957, which contained no ejector plate but which was unloaded by gravity dumping when the tailgate mechanism was swung out of the way. The loading blade in the tailgate compacted the refuse when sufficient refuse was loaded to react against the front.

The other major type available prior to April 10, 1957, was a side loader, manually loaded through side doors near the front of the truck and unloaded by an ejector plate moved from front to rear to push the refuse out of the rear doors. The ejector plate could also be used to compact the load toward the closed rear doors. Neither of these should be confused with the "duo-press conpaction" discussed later.

Donald C. Koentop, Heil's Chicago district sales representative, frequently called on Mr. Berolzheimer trying to persuade him to have the City buy Heil equipment. On the basis of a loading time-tonnage bidding formula devised by Mr. Berolzheimer, most of the units sold to the City during the first part of 1957 and the years immediately preceding were of a continuously loading type. Mr. Berolzheimer pointed out to Mr. Koentop that Heil would have to provide much faster loading than the equipment then used by the City to compete successfully.

A few days prior to April 10, 1957, Mr. Berolzheimer told Mr. Koentop that he had an idea for a continuous loader. He prepared a drawing which was plaintiff's Exhibit B at the trial, and on April 10, 1957, met with Mr. Koentop and and George Rea, Heil's chief engineer. Mr. Rea signed Mr. Berolzheimer's drawing and another document prepared by Mr. Berolzheimer, plaintiff's Exhibit A at the trial, to the effect that Heil would not patent or use as a basis of design the plan of mechanism for a continuous loading, compacting type refuse collection truck body, or any of its components, submitted by Mr. Berolzheimer, without his consent and agreement as to payment, unless the plan was shown to infringe an existing patent. Mr. Berolzheimer signed defendant's Exhibit 1, to the effect that as a condition to Heil's consideration of suggestions from outside persons, the latter acknowledged that Heil assumed no obligation in the absence of a formal written contract, and was released from any liability in connection with use of a suggestion submitted, except liability on a valid patent. When he signed defendant's Exhibit 1, Mr. Berolzheimer filled in the words "a continuous loading refuse collection truck body" to describe his suggestion.

In addition to Mr. Koentop, Mr. Rea, and Mr. Berolzheimer, the late George Urban, then one of Heil's engineers, was present at the conference on April 10, 1957, and, for part of the time, Heil's president, Joseph Heil. There are conflicts in the testimony of the surviving witnesses to this conference as to the matters covered. However, Mr. Berolzheimer's own impression was that the conference ended on a negative tone and that Heil had no further interest in his proposal. He did not resubmit the proposal to Heil or to anyone else, although, as indicated, his duties included making recommendations for improvements in equipment used by the City. His assertion of a claim of oral disclosure to Heil came only after the holder of the subsequently acquired Urban patent had publicized the invention. Cf. Friedman v. Washburn Co., 7 Cir., 1946, 155...