Cercast Inc. and Vestshell Inc. (Plaintiffs)
v.
Shellcast Foundries Inc., Bodo Morgenstern and
Vera Stibernik (Defendants)
Trial Division, Walsh J.—Montreal, January 18;
Ottawa, January 30, 1973.
Practice—Rules of court—Stay of judgment pending
appeal—Whether applicable to interlocutory judgment order
ing defence to be filed within two weeks—Rules 2(2), 1213.
Federal court Rule 1213 provides:
Execution of a judgment appealed against shall be stayed
pending the disposition of the appeal upon the appellant
(a) giving security satisfactory to the respondent that, if
the judgment or any part thereof is affirmed, the appel
lant will satisfy the judgment as affirmed, or
(b) giving such security and doing such other acts and
things as are required by order of the Trial Division to
ensure that, if the judgment or any part thereof is
affirmed, the judgment as affirmed will be satisfied.
Federal Court Rule 2(2) provides:
These Rules are intended to render effective the substan
tive law and to ensure that it is carried out; and they are
to be so interpreted and applied as to facilitate rather than
to delay or to end prematurely the normal advancement of
cases.
Held, having regard to Rule 2(2), Rule 1213 is not appli
cable to an appeal from an interlocutory judgment ordering
defendants to do something within a certain delay, in this
case to move for particulars or file a statement of defence
within two weeks.
MOTION.
COUNSEL:
K. Plumley for plaintiffs.
M. McLeod for defendants.
SOLICITORS:
Gowling and Henderson, Ottawa, for
plaintiffs.
Ogilvy, Cope, Porteous, Hansard, Marler,
Montgomery and Renault, Montreal, for
defendants.
WALSH J.—Four more motions in this matter
came on for hearing before me in Montreal on
January 18, 1973, these being a continuation of
a series of motions and appeals that have been
made which have had the effect of frustrating
plaintiffs' efforts to advance the proceedings to
eventual trial on the merits ever since my judg
ment of November 7, 1972, dismissing plain
tiffs' motion for an interlocutory injunction. It is
evident that as a result of that judgment, which
has not been appealed, defendants have no
interest in expediting the trial on the merits
while plaintiff' on the other hand has just
reason for feeling that time is of the essence in
that unless and until it can obtain a judgment
against defendants on the merits, defendants are
in a position to continue to carry on and expand
the very practices which plaintiff complains of
including the passing on to third parties of the
knowledge which plaintiff claims defendants
obtained from it while defendant Morgenstern
was in its employ and which is allegedly of a
confidential nature.
For a full understanding of the motions now
before me it is desirable to again make a brief
review of the previous proceedings. By judg
ment dated March 14, 1972, Pratte J. refused to
grant defendants' motion to strike a large
number of paragraphs from plaintiffs' statement
of claim on the grounds that the Trial Division
of the Federal Court of Canada has no jurisdic
tion to hear and determine the allegations and
issues therein contained nor to grant the conclu
sions prayed for therein. Defendants were rais
ing the constitutional issue of the validity of
section 7 of the Trade Marks Act and its
application to the present proceedings. This
judgment of Pratte J. was appealed and the
appeal is still pending. Meanwhile, the identical
issue of law had been raised in the Court of
Appeal in MacDonald, Railquip Enterprises
Ltd. v. Vapor Canada Ltd. and in due course it
brought down its decision dated November 1,
1972, [1972] F.C. 1156, upholding the constitu
tionality of this section. During the lengthy
hearing of the proceedings for the interlocutory
injunction before me the same issue was raised
and I indicated at the time that while the hearing
should proceed on the issues of fact involved, I
would hear no argument relating to the constitu
tional issue but would withhold my judgment
pending the judgment of the Court of Appeal in
the Vapor case which was expected at an early
date, and that I would then follow it. Soon after
the said judgment of the Court of Appeal came
down on November 1, 1972, I rendered the
above-referred-to judgment on the interlocutory
injunction on November 7, 1972 in which I
dismissed defendants' objections to the jurisdic
tion of the Court on the constitutional issue in
accordance with the Court of Appeal judgment.
Since then the judgment of the Court of Appeal
has been appealed to the Supreme Court, but in
the normal course of events a considerable
length of time will elapse before the case is
heard and judgment rendered there.
Subsequently, two further motions came on
for hearing before me in Montreal on December
12, 1972, the first being plaintiff's motion
requiring defendant Morgenstern to produce
writings and documents relating to his dealings
with certain companies in Europe and attend for
cross-examination, and renewing its application
for an interlocutory injunction and finally
asking for default judgment against defendants
for failure to file a defence to the statement of
claim which had been filed on January 24, 1972
or alternatively for an order requiring them to
file it within one week. The other motion was a
motion by defendants asking that plaintiff's
motion be dismissed on the grounds that the
Federal Court of Canada does not have jurisdic
tion to grant the relief sought in the said motion,
and that in any event the application for the
relief sought by way of interlocutory injunction
had already been dealt with by my judgment of
November 7, 1972 rejecting the application,
which judgment had not been appealed. I ren
dered judgment on these two motions on
December 19, 1972 dismissing plaintiff's motion
with respect to requiring defendant Morgenstern
to produce documents and attend for cross-
examination and the renewed request for an
interlocutory injunction but I maintained it with
respect to the request for an order requiring
defendants to plead to the proceedings, and
issued an order in the following terms:
... defendants are ordered to file a motion for particulars if
it is their intention to file same or, in the alternative, a
defence to the statement of claim within two weeks of the
date of this judgment.
With respect to defendants' motion in which the
constitutional issue was again raised to support
the contention that the Federal Court of Canada
does not have jurisdiction to grant the relief
sought, I dismissed this motion. In my reasons
for judgment on plaintiff's motion I stated in
part as follows:
What plaintiffs' motion does point up however is the
urgency of disposing of these proceedings on the merits at
the earliest possible date. If plaintiffs can establish at the
proceedings on the merits that defendant Morgenstern has
appropriated and used for his own purposes confidential
information and documents belonging to plaintiffs, then the
fact that he is now disseminating this information and pass
ing it on to third parties in Europe who are competing with
plaintiffs' licensee there cannot help but increase the dam
ages which plaintiffs allege they are suffering. Moreover, on
the basis of the further affidavits now before me it would
appear that, if the contents of them can be substantiated,
and I am not so deciding at this stage of the proceedings,
plaintiffs would have a stronger case than that presented to
me at the hearing on the interlocutory injunction, and one in
which the facts would more closely resemble those in the
case of Vapor Canada Limited v. John A. MacDonald,
Railquip Enterprises Ltd., and Vapor Corporation Limited,
No. T-2517-71, judgment of April 19, 1972, in which an
interlocutory injunction was granted. I believe therefore that
the third part of plaintiffs' motion requiring defendants to
file a statement of claim within a brief delay to be fixed
should be granted so that the proceedings can be heard on
the merits at an early date.
With respect to defendants' motion I stated:
Against this, defendants have again raised the issue of the
constitutionality of the Trade Marks Act claiming that the
Federal Court of Canada does not have jurisdiction to grant
the relief sought in this motion. In view of the decision of
the Court of Appeal in the John A. MacDonald, Railquip
Enterprises Ltd. v. Vapor Canada Limited case, A-85-72,
[[1972] F.C. 1156] dated November 1, 1972 (which judg
ment is itself now under appeal to the Supreme Court of
Canada) I cannot sustain this argument of defendants any
more than I sustained the same argument based on unconsti-
tutionality when it was raised before me in the proceedings
in this case for the interlocutory injunction.
Defendants had also argued that they could not
be required to plead to the present proceedings
as they had appealed on the same constitutional
grounds the judgment of Pratte J. requesting the
striking out of certain paragraphs of plaintiff's
statement of claim and asking that defendants'
delays for pleading be suspended. In comment
ing on this argument I stated:
This judgment was appealed but this does not have the
effect of staying the execution of it. Rule 1213 respecting
the staying of execution of a judgment appealed from by the
giving of security would not seem to be applicable to the
staying of a judgment merely refusing to strike out certain
paragraphs of plaintiffs' statement of claim. At this stage of
the proceedings, therefore, plaintiffs' original statement of
claim remains in full force and effect and defendants have
neglected to plead to it although it was filed as long ago as
January 24, 1972. Defendants have the right to continue
with their appeal in the present proceedings despite the
decision of the Court of Appeal in the Vapor case (supra),
and despite the judgment in that case a judge of the Trial
Division cannot state what the Court of Appeal will do in
the appeal against Mr. Justice Pratte's judgment in the
present case.
I then made a statement which was apparently
erroneous when I said that defendants had pro
ceeded no further with their appeal in the Vapor
case and that the appeal case had not been
prepared. The Appeal Book was not in the file
which I had looked at at the time but a close
examination of the file does indicate that it had
been filed on May 23 pursuant to Rule 1207(3).
This misunderstanding in no way affected the
ratio of my judgment, however, which appears
later on page 9 as follows:
To require the defendants to plead to the proceedings as
brought without further delay so that the case can be fixed
for hearing on the merits at the earliest possible date in no
way prejudices their right to continue their appeal against
the judgment of Mr. Justice Pratte refusing to strike certain
paragraphs from the statement of claim.
Both of these judgments of December 19, 1972
have now been appealed to the Court of Appeal.
The four further motions now before me are
as follows:
1. Defendants' motion for an order pur
suant to Rule 1213(b) fixing such securi
ty and requiring the doing of any other
acts and things that may be required to
ensure that, if the judgment of December
19, 1972 ordering defendants to file a
motion for particulars or a defence to the
statement of claim within two weeks of
December 19, 1972, is affirmed in the
Court of Appeal, the judgment as
affirmed will be satisfied; and secondly,
an order that all proceedings in the case
be stayed until a final judgment has been
rendered not only by the Federal Court
of Appeal on defendants' motion to strike
out certain paragraphs and conclusions of
plaintiff's statement of claim, which
motion the judgment of Pratte J. refused,
but also until judgment has been ren
dered in the Supreme Court in the event
of an appeal to the Supreme Court of
Canada from a judgment on this issue by
the Federal Court of Appeal.
2. A further motion by defendants for
particulars under reserve of the foregoing
motion. This motion was answered by a
document entitled "Reply To Demand
For Particulars" which was filed on
behalf of plaintiff on January 12, 1973.
3. A motion on behalf of plaintiff again
asking for an order for default judgment
because of defendants' failure to file a
statement of defence or, in the alterna
tive, that a statement of defence be filed
no later than January 25, 1973.
4. A motion on behalf of defendants
again asking for the striking out of cer
tain paragraphs in the statement of claim
and conclusions enumerated therein on
the grounds that "the particulars fur
nished with respect thereto in Plaintiffs'
Reply to Demand for Particulars dated
January 12, 1973, are insufficient", or
alternatively for an order requiring plain
tiff to furnish further and better
particulars.
In support of their motion referred to under
No. 1 above, defendants rely on the mandatory
wording of Rule 1213 which says: "Execution
of a judgment appealed against shall be
stayed . ." and in the French version: "L'exécu-
tion d'un jugement porté en appel doit être
suspendue . ." and argue that a judge of the
Trial Division has no option but to fix security
and stay the proceedings pending the disposition
of the appeal when an appeal has been made
from a judgment of the Trial Division. How
ever, despite the mandatory wording of this rule
I believe that effect should be given to all the
rules in their interpretation and in particular
Rule 2(2) which reads as follows:
(2) These Rules are intended to render effective the sub
stantive law and to ensure that it is carried out; and they are
to be so interpreted and applied as to facilitate rather than to
delay or to end prematurely the normal advancement of
cases.
In commenting on the rules, Jackett C.J. stated
in The Federal Court of Canada: A Manual of
Practice at page 43:
Unfortunately, there have to be so many detailed rules to
meet the exigencies created by circumstances that arise only
occasionally that it becomes difficult to see the woods for
the trees. Indeed, so true is this that it is not uncommon for
a practitioner to hold the view that it is his client's right,
and, therefore, his professional duty, to take advantage of a
rule to crf ate delay or confusion even though the reason for
the existence of the rule does not arise in the particular case.
My own view is that this is an unduly cynical view that is
incompatible with the principles regulating the conduct of
the legal profession. In any event, whatever may have been
the true view as to the proper application of rules of court
apart from Rule 2(2) of the new Rules of the Federal Court,
that provision puts an end to any doubt in clear and unam
biguous words which are based on a comparable provision
in the Quebec Code of Civil Procedure. Rule 2(2) is repro
duced here for emphasis:
2. (2) These Rules are intended to render effective the
substantive law and to ensure that it is carried out; and they
are to be so interpreted and applied as to facilitate rather
than to delay or to end prematurely the normal advancement
of cases.
If I appear to have put undue emphasis on this aspect of
procedure, let me say in defence that I hold the view very
strongly that the failure of the judicial process to settle the
real disputes between members of society as quickly and as
economically as possible is a direct result of the way the
litigation process has been used—I am tempted to say
abused.
This statement with which I wholeheartedly
agree is particularly applicable to the circum
stances of the present case. Rule 1213 appears
to be designed for the staying of execution of a
judgment calling upon a defendant to pay a sum
of money and I do not consider it to be appli
cable to an appeal from an interlocutory judg
ment ordering defendant to do something within
a certain legal delay. It is unrealistic to say the
defendants by giving security to satisfy the
judgment if it is affirmed can stop the execution
of it when what the judgment did was to order
defendants to do certain things within a brief
delay (in this case by January 3) and it is evi
dent that in this event the judgment could never
be satisfied, as by the time the appeal has been
decided the delay will have long since expired. I
made a similar finding in my reasons for judg
ment dated December 19, 1972 when defend
ants sought a stay of execution because of the
appeal of Mr. Justice Pratte's judgment, when I
said:
Rule 1213 respecting the staying of execution of a judgment
appealed from by the giving of security would not seem to
be applicable to the staying of a judgment merely refusing to
strike out certain paragraphs of plaintiffs' statement of
claim.
Defendants also argue that when an issue of law
has been raised in any proceedings it is desir
able that this issue should be settled before
proceeding to a trial of the issue on the facts of
the case, and that a long line of jurisprudence
supports this. No doubt this is so as a general
rule, but like many general rules, unless excep
tions are permitted in the circumstances of a
particular case, the Court may be forced to
reach an absurd conclusion. To say that because
an important constitutional issue has been
raised in another action between different par
ties and that an appeal from a judgment reject
ing it has presently been commenced before the
Supreme Court, it therefore follows that no
other case in which the same issue of law has
been raised can proceed any further until the
final determination of this issue, would, in my
view, result in greater inconvenience and injus
tice to plaintiff who is justifiably anxious to
proceed than would the alternative of forcing
defendants to proceed to trial on the merits
under reserve of their objections based on this
constitutional issue which they are still entitled
to raise. This was exactly the issue with which I
was faced in the proceedings for the interlocuto
ry injunction where, under reserve of the pend
ing appeal on the constitutional issue, I required
the parties to proceed to a hearing on the
injunction, as a result of which no time was lost
and by the time I was ready to render judgment
on the injunction the issue had been decided, at
least as far as the Court of Appeal is concerned.
In the present case the question of the furnish
ing of particulars still has to be dealt with and
this will then have to be followed by defend
ants' plea and plaintiff's answer. There will no
doubt be lengthy examinations on discovery so
that some time will elapse before the proceed-
ings can be set down for trial. A lengthy trial
will then ensue. Before rendering judgment on
the merits the trial judge will then have to
decide if he should await the judgment of the
Supreme Court in the Vapor case on the consti
tutional issue before issuing his judgment.
Should the judgment of the Supreme Court
eventually reverse the judgment of the Court of
Appeal and sustain defendants' objections on
the constitutional issue no doubt some time and
effort will have been lost as a result of proof
having been made on the merits which might
otherwise have been unnecessary, but in my
view this is a lesser evil than to say that all
proceedings should be stayed at this date for a
period which may well be two years while
awaiting the judgment of the Supreme Court,
followed by a further extended delay while the
pleadings and examinations on discovery for
trial of the present case are completed in the
event that the Supreme Court judgment upholds
the decision of the Court of Appeal which, at
present, must be taken as being the law. More
over, plaintiff in the present case has no control
over the progress of the appeal in the Vapor
case and can do nothing to expedite it should
the attorneys in that case show a lack of dili
gence in the prosecution of it.
It may be objected to by defendants that not
only is there an appeal pending to the Supreme
Court on the constitutional issue in the Vapor
case but there are also appeals pending to the
Court of Appeal on this issue in the present case
and that that is why they ask that the proceed
ings in the present case be stayed. However,
from a practical point of view it would appear
unlikely that the Court of Appeal, having
already rendered a very full judgment on this
issue in the Vapor case, would be prepared to
hear constitutional arguments all over again
including arguments by the Attorneys General
on an identical issue in the present case. Cer
tainly, if it did so, the same judgment would be
rendered. Similarly, even if there were an
appeal from such a judgment in the present case
to the Supreme Court that Court would certain
ly not hear any such appeal until it had disposed
of the appeal on the same issue in the Vapor
case. It is evident, therefore, that the status quo
with respect to the appeals to the Court of
Appeal in the present case will be maintained
for some time, and defendants should not be
able to avail themselves of this to gain further
delay and avoid taking any steps to advance the
proceedings in the present case towards trial on
the merits. The motion of defendants to fix
security and stay the proceedings is therefore
dismissed, with costs.
With respect to the plaintiff's motion desig
nated as No. 3 above seeking a default judg
ment because of defendants' failure to file a
statement of defence or in the alternative an
order that it be filed no later than January 25,
1973, plaintiff's counsel indicated at the hearing
before me that he would withdraw this and I
permitted same to be withdrawn without costs.
Motions designated as Nos. 2 and 4 above
can be dealt with simultaneously. Since I have
dismissed defendants' motion for a stay of pro
ceedings their motion for particulars, which was
made only under reserve of this other motion,
can now be dealt with. Before it was argued or
dealt with before me, however, plaintiff had
already answered it by a document entitled
"reply to demand for particulars". It is plain
tiff's contention that this was not intended to be
a furnishing of particulars but merely a contes-
tation of the motion requiring them to furnish
same, and it consisted of indicating to defend
ants where in the proceedings and examinations
on affidavits already in the record the particu
lars they required could be found. Under this
view of the significance of this document
defendants' motion to strike out paragraphs of
the statement of claim and conclusions because
the particulars furnished are insufficient is pre
mature, since plaintiff has not yet been ordered
to furnish same nor have the particulars been
furnished as such. The second part of defend
ants' said motion requesting an order requiring
plaintiff to furnish further and better particulars
can now be dealt with, however, at the same
time as the question of whether in fact any
particulars are required with respect to any of
the paragraphs in question.
Before dealing specifically with the particu
lars to be furnished it is desirable to make some
general comments as to what a motion for par
ticulars is supposed to accomplish, always bear
ing in mind the general object is the desirability
of advancing proceedings to trial as rapidly as
possible and of introducing precision into the
pleadings, and providing for an orderly trial in
which the issues of fact the Court will be called
upon to deal with are defined and limited as
precisely as possible. Pleadings should be kept
as brief as possible and plaintiff should not be
required to set out in its pleadings detailed facts
which can more properly be brought forward at
trial as part of its evidence. Neither should it be
required to give details to defendants of facts
that are well known to defendants already so
that defendants are well aware of facts which
they will have to meet. On the other hand, broad
generalized statements in a statement of claim,
such as the present, have the disadvantage of
opening up such a wide field of proof to plain
tiff that the trial can be greatly lengthened by
the introduction of extensive evidence of a
more or less irrelevant nature that would do
little to aid the Court in determining the real
issues of fact involved. It is apparent from the
frequent use of the word "confidential"
throughout the statement of claim that plaintiff
takes the view that all the equipment it uses, the
manner in which it is used, the types of wax, the
moulding techniques, the types of alloys, the
ceramic materials, the vacuum pouring tech
niques, the wax injection machines, and in fact
everything that it uses and everything that it
does in the manufacture of double-walled pin
fin non-ferrous investment castings is confiden
tial, and that none of this information of equip
ment can or should be used by defendants in
view of defendant Morgenstern's long employ
ment with plaintiff Cercast Inc. On the other
hand, it was made abundantly clear in the evi
dence before me in connection with plaintiff's
application for an interlocutory injunction that
equipment similar to that used by plaintiff, and
the waxes, alloys, ceramic material, injection
and vacuum pouring machines, and so forth are
widely used in the investment casting industry
and the nature of this equipment and these
materials, (to the extent that plaintiff's equip
ment and materials and the manner of using
same does not differ from that generally used in
the industry) is not therefore confidential infor
mation. Defendant Morgenstern has devoted
most of his life to the industry, has attended
professional conferences and conventions, visit
ed other plants, and has of necessity acquired a
great deal of information in this field quite apart
from anything he learned during the course of
his employment by plaintiff, and he is entitled to
use this information and to purchase or design
equipment to the extent that this arises from the
subjective pool of knowledge which he pos
sesses. In order for plaintiff to succeed, there
fore, it has to establish with precision, firstly, in
what manner its equipment, material or tech
niques differs from and is an improvement over
that in general use in the industry, and secondly,
to what extent defendants have copied this
equipment or used materials or techniques
developed expressly by plaintiff for its own use,
rather than having designed same entirely
independently of plaintiff. If plaintiff can estab
lish that defendant Morgenstern has in any way
copied such confidential equipment or used
such confidential information or caused his
company, Shellcast Foundries Inc. to use it, or
has conveyed details of such confidential equip
ment or such confidential information to third
parties it will have succeeded in its action. It
does not follow, however, that it should be
permitted in its statement of claim to take the
position that practically everything it uses and
the entire technique of making these castings is
original and confidential to it (which is an unten
able proposition), rather than limiting its conten
tions to such portion of its equipment as has
been originally designed or modified by it or
such techniques as it has developed which
nobody else uses or has knowledge of, and then
establishing that defendants have copied this.
Plaintiff's document entitled "reply to
demand for particulars" does not constitute a
proper furnishing of particulars but is rather an
argument to the effect that for the most part the
particulars requested are not required because
they can already be found in the file of the
proceedings including affidavits and evidence
given on examination on these affidavits in con
nection with the motion for an interlocutory
injunction, and an indication where this infor
mation can be found in the file. Defendants
argue that just as in patent actions it is now
established by the jurisprudence that it is not
sufficient to allege that the plaintiff is the owner
of a patent, giving the number of same, and that
defendants' actions which it complains of have
infringed this patent without going further and
indicatEng in what way they have infringed it
and what in general terms the patent deals with,
the same reasoning should be applied to a
motion for particulars which should give the
information sought rather than an indication of
where it can be found. Without deciding wheth
er jurisprudence established in patent infringe
ment actions is applicable in the present circum
stances, I am in accord with this argument.
Particulars are given to supplement paragraphs
of a statement of claim or a defence as the case
may be and should stand by themselves in con
nection with the paragraphs which they par
ticularize without any reference to the evidence
supporting them. The references, therefore,
indicating where information can be found in
plaintiff's document entitled "reply to demand
for particulars" must be looked on rather as an
argument that defendants do not require the
particulars in question than as being a proper
furnishing of them.
When faced with a motion for particulars the
plaintiff has two choices. Either it can provide
the particulars requested in which event, if
defendant does not deem them sufficient it can
request the Court for an order requiring that
further particulars be given, or alternatively it
can oppose the motion for particulars and the
Court will then order which, if any particulars
plaintiff must furnish pursuant to such order. In
the present case plaintiff has confused the situa
tion by combining in its document entitled
"reply to demand for particulars" what is really
an argument as to why, for the most part, they
are not necessary, with an actual furnishing of
particulars with respect to certain paragraphs,
without waiting for an order. Defendants then
made the motion referred to under No. 4 above
which it was possibly necessary for them to
make in case plaintiff's document was consid
ered to constitute a furnishing of particulars
which, in this event, would be insufficient and
would require a further order from the Court
directing what particulars are to be furnished.
Dealing with the two motions together, there
fore, I believe that the proper procedure is to
deal with the matter as if defendants had simply
made a motion for particulars which was
opposed by plaintiff, and render an order
indicating which, if any, particulars must be
furnished.
Applying the foregoing general principles I
can now deal specifically with the various para
graphs of defendants' motion for particulars and
plaintiff's reply to demand for particulars, here-
inafter referred to simply as "reply" as follows:
The paragraph numbers correspond with the
numbers in defendants' motion for particulars.
Paragraph 1, dealing with paragraph 5 of the
statement of claim, plaintiff's
reply is inadequate. Plaintiff is
ordered to specify what, if any,
"confidential information" the
employee Vera Stibernik pos
sessed.
Paragraph 2, dealing with paragraph 8 of the
statement of claim, particulars
requested in subparagraph (i) will
be sufficiently furnished if plain
tiff, in complying with this order,
repeats the answer given in sub-
paragraph 2(i) of its reply deleting
the reference to the cross-exami
nation of Bodo Morgenstern on
his affidavit.
With respect to subparagraphs (ii)
and (iii), plaintiff is ordered to
specify in a general way what part
of the technical information used
in the production of the castings in
question is "confidential". As pre
viously indicated the position that
all the technical information used
is confidential is an untenable one
and plaintiff's statement of claim
and the evidence at the trial should
be confined to that technical infor
mation developed by it and not
normally used elsewhere in the
industry, which it believes it can
prove defendant Morgenstern has
taken from it and is being used by
defendant Shellcast Foundries Inc.
The information given in subpara-
graph 2(ii) in the reply is therefore
insufficient for while it may be
correct to say that "all of the tech
nical information developed by
Cercast is confidential to it" this in
no way indicates which such tech
nical information was developed
by it.
Paragraph 3, dealing with paragraph 10 of the
statement of claim, it is noted that
clauses (a) to (h) of the said para
graph 10 all contain the conclud
ing clause "all of which is the con
fidential and proprietary
information of Cercast" which, as
indicated above, is an untenable
proposition as these paragraphs
cover the entire investment cast
ing process, the general principles
of which and equipment used are
well known in the industry. Plain-
tiff should indicate, therefore,
which parts of this knowledge and
techniques can be proved by it to
be confidential and not used by or
known to anyone else in the indus
try. With respect to subparagraph
3(i) of defendants' motion, the
answer given in 3(i) of the reply
would, if repeated when furnish
ing particulars pursuant to the
order I am rendering, be suffi
cient. The answer given in clause
3(ii)(a) of the reply to clause
3(ii)(a) of defendants' motion is
improper in that it merely gives a
reference to where this informa
tion can be found rather than
giving the particulars demanded.
The answers in the reply to clause
3(ii)(b) and (c) would be sufficient
if repeated when furnishing par
ticulars. The same applies to the
answers given in the reply to sub-
paragraph 3 (iii).
Paragraph 4, dealing with paragraph 11 of the
statement of claim, plaintiff
should specify which of the pieces
of equipment referred to differ so
significantly from other similar
equipment used in the industry
generally that the alterations made
by it are improvements of a "con-
fidential nature" which have
allegedly been copied by defend
ants.
Paragraph 5, dealing with paragraph 12 of the
statement of claim, this is a gener
al paragraph dealing with all of
plaintiff's technical files, drawings
and documents since it com
menced business in 1959 and it
would be impractical to require
plaintiff to furnish details as to
which of these files are confiden-
tial. The burden remains on plain
tiff at the trial to establish that any
information which it can prove the
defendants have taken from its
files is confidential. No details will
be ordered on this paragraph.
Paragraph 6, dealing with paragraph 13 of the
statement of claim, this is no
longer relevant since plaintiff
Vestshell has discontinued its
proceedings.
Paragraph 7, dealing with paragraph 14 of the
statement of claim, and specifical
ly with clauses (a) to (d), these
allegations relating to individual
parts or tools would only be rele
vant to the extent that defendants
have manufactured an identical
part or tool. There is evidence in
the Court record to the effect that
each part made requires an entire
ly different tool design, gating and
assembly technique, and so forth,
and while the experience gained in
designing a tool for and manufac
turing one part may be of some
help in designing a tool for and
manufacturing another part, spe
cific records for a given tool or a
part are of little use to anyone else
unless the same tool or part is to
be made by him. The same does
not apply to clauses (f) to (h),
however, which deal generally
with the equipment and materials
used. No particulars are ordered
therefore with respect to clauses
(a) to (d) but particulars should be
given with respect to clauses (f) to
(h) of paragraph 14 of the state
ment of claim indicating which
such information material is
"confidential".
Paragraph 8, dealing with paragraph 15 of the
statement of claim, the answer
given in paragraph 8 of the reply
would, if repeated by plaintiff
when furnishing particulars, be
sufficient.
Paragraph 9, dealing with paragraph 17 of the
statement of claim, the answer
given in paragraph 9 of the reply
is insufficient since it merely
refers to the evidence given by
Mr. Morgenstern in the transcript
of his cross-examination and does
not state what plaintiff alleges to
be the cause for the termination of
his employment. Plaintiff is direct
ed to furnish particulars of this.
Paragraph 10, dealing with paragraph 19 of the
statement of claim, subparagraph
(i) requests particulars with
respect to clause (d) thereof. The
answer given in subparagraph
10(i) of the reply would, if
repeated when furnishing par
ticulars, be sufficient, deleting
the reference to the evidence of
Mr. Rausch. With respect to sub-
paragraph (ii) requesting particu
lars of clause (e) of paragraph 19
of the statement of claim, this
more or less repeats paragraph
14 of the statement of claim and
as I directed in connection with
that paragraph, details should be
given showing which files con
tained "confidential" data of for
mulations and procedures "deve-
loped" by plaintiff.
Subparagraph (iii) requests particulars relat
ing to clause (f) of para
graph 19 of the statement
of claim, and the answer
given in clause 10(iii)(a)
and (b) of the reply would,
if repeated when furnish
ing the particulars, be suf
ficient, deleting references
to where this is to be
found in the file. With
respect to subparagraph
(iv) relating to clause (j) of
paragraph 19 of the state
ment of claim, and
requesting particulars of
confidential proprietary
information concerning
plaintiff's production fold
ers and files for foundry
records, this is sufficiently
answered in subparagraph
(iv) of paragraph 10 of the
reply although, as previ
ously indicated, this has
little relevance in that
records kept for any given
part are only useful and
can be relied on to the
extent that it can be estab
lished that defendants are
making an identical part.
With respect to subpara-
graph (v) requesting par
ticulars relating to clause
(1) of paragraph 19, sub-
paragraph (v) of
paragraph 10 of the reply
is an inadequate and too
generalized reply. Plaintiff
should furnish specific
details as to which of its
techniques are different
from those used by any
other manufacturer for, as
the reply itself indicates,
the wax assembly and
gating techniques differ
with the manufacture of
each specific part. These
techniques in general are
well known and not confi
dential information of
plaintiff.
Paragraph 11, dealing with paragraph 20 of the
statement of claim, the answer
given to the particulars requested
in clause 11(a) of the reply gives
no specific information as to
which files and "confidential"
information defendants allegedly
removed from plaintiff and are
now using. With respect to
clause (b), the particulars given
in clause 11(b) of the reply are
insufficient in that they do not
indicate which of this equipment
allegedly used by defendants and
copied from plaintiff was confi
dential to plaintiff and differed
significantly from similar equip
ment used by other persons in
the industry.
Paragraph 12, dealing with paragraph 21 of the
statement of claim, paragraph 21
as drawn appears to be suffi
ciently detailed and no particu
lars will be ordered on this
paragraph.
Paragraph 13, dealing with paragraph 23 of the
statement of claim, plaintiff
should particularize the broc
hures and advertising material
referred to. Paragraph 13 of the
reply merely gives a reference to
the affidavit and cross-examina
tion of defendant Morgenstern
which would not be a proper
answer.
Paragraph 14, dealing with paragraph 30 of the
statement of claim, particulars
should be given with respect to
what alleged confidential techni
cal information of plaintiff was
possessed by the employees
Jerry Wintgens, Ercole Man-
giante, Peter Mensl, and Pascual
Martin. The answer given in sub-
paragraph 14(iî) of the reply
should also be repeated when
furnishing the particulars.
Paragraph 15, dealing with paragraph 36 of the
statement of claim, particulars
should be given as to the "confi-
dential" process and information
allegedly used by defendants in
making the tools in question.
Paragraph 16, dealing with paragraph 39 of the
statement of claim, this is no
longer relevant since the discon
tinuance of plaintiff Vestshell
Inc.
Paragraph 17, dealing with paragraph 40 of the
statement of claim, no particulars
are required with respect to this
paragraph, the allegations of
which will, of course, have to be
proved by plaintiff.
Paragraph 18, dealing with paragraph 41 of the
statement of claim, no particulars
are required with respect to this
paragraph the allegations of
which are sufficiently particula
rized and the Court will decide
on the basis of the evidence sub
mitted which, if any, of the alle
gations in the subparagraphs of
the said paragraph 41 have been
proved.
Paragraphs 19 - 23. These all refer to the con
clusions of the action which
are properly drawn and
require no further particu
lars. It will be the responsi
bility of the Court to decide
on the basis of the evidence
submitted which, if any, of
these conclusions should be
granted.
The particulars ordered above shall be fur
nished by plaintiff within fourteen days of the
order I am rendering, in a document entitled
"particulars furnished by plaintiff pursuant to
order of January 30, 1973 on defendants'
motion for particulars".
Defendants will be required to plead to the
action on the merits within ten days of the filing
of the particulars pursuant to the order I am
rendering.
Part II of the conclusions of defendants'
motion for particulars asking for the striking out
of clause 41(a) of the statement of claim and
clauses 1(a), (b), (c) and (g) of the conclusions
relates to the constitutional issue and is
dismissed.
The costs of this motion for particulars and of
defendants' other motion relating to the
inadequacy of the particulars furnished in plain
tiff's document entitled "reply to demand for
particulars" (Nos. 2 and 4 above) shall be costs
in the cause.
1 Plaintiff Vestshell Inc. discontinued its action by notice
produced December 12, 1972.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.