author: BARNES, Circuit Judge:

text:
    KODEKEY ELECTRONICS, INC., Plaintiff-Appellee, v. The MECHANEX CORPORATION et al., Defendants-Appellants.
    No. 73-1303.
    United States Court of Appeals, Tenth Circuit.
    Argued and Submitted Aug. 14, 1973.
    Decided Oct. 11, 1973.

      Charles F. Brega, Denver, Colo., for plaintiff-appellee.
    Harry L. Hobson, Graham M. Clark, Jr., and Thomas A. Faulkner, Denver, Colo., for defendants-appellants.
    Before BREITENSTEIN, BARNES  and BARRETT, Circuit Judges.

       Honorable Stanley N. Barnes of the Ninth Circuit, sitting by designation.

   BARNES, Circuit Judge:

This is a civil diversity action seeking money damages and injunctive relief which would prohibit defendant from manufacturing, distributing, and selling a certain electronic speedometer and tachometer. The complaint charges (1) misappropriation of trade secrets, (2) breach of contract, and (3) unfair competition. Kodekey Electronics is a California corporation, and “defendant Me-chanex is located in Colorado,” and is a subsidiary of defendant Tenneco, a Delaware corporation.

Jurisdiction rests on 28 U.S.C. § 1332(a)(1) and the requisite amount in controversy exists. The District Court tried the issue of liability first, and found a basis for recovery, and granted judgment on the three charges above listed. It originally issued a restraining order, reserving its findings and conclusions with respect to damages, but thereafter fixed damages in the sum of $201,768.00, together with costs. The District Court thereafter signed an order modifying its opinion and order, and denied defendants’ Motions to Reopen, for a Partial New Trial, and for a New Trial.

I. FACTS

On June 9, 1966, Mr. Joseph Kramas, and one Erich Kaufmann, individually, and doing business as K & K Electronics, received an exclusive license to manufacture and market a new type of speedometer which had been developed by one Frank D. Neu and one John Foraker (Plaintiff’s Exhibit C).

In November, 1966, Mr. Joseph Kramas, representing K & K Electronics, a partnership, and predecessor of Plaintiff Kodekey Electronics, Inc., approached Mr. Allen J. Stephens of the Mechanex Corporation, and suggested that Mechanex should market an electronic speedometer then being manufactured and sold by K & K Electronics. At that time Mr. Kramas felt that his offering was promising, but that his product needed marketing attention on a national scale (Tr. Vol. I, p. 25).

Mr. Neu and Mr. Foraker had been testing prototypes of their new speedometer with the Greyhound Corporation previous to the execution of the licensing agreement. Subsequent to the execution of the licensing agreement, Mr. Kramas was contacted by Freightliner Corporation (a manufacturer of trucks for Greyhound Moving Corporation), and was asked whether it would be possible to modify the speedometer, as installed in the Greyhound Buses, for use in trucks. Mr. Kramas then began investigating the speedometer plights of other trucking firms in the California area, and found that a serious problem existed with respect to speedometers in the trucking industry (Tr. Vol. I, p. 26). Mr. Kramas thereupon compiled a mailing list and sent inquiries to large and small trucking firms throughout the country, and received significant responses regarding the problems that the trucking industry was experiencing with regard to speedometers and tachometers.

After approaching the Mechanex Corporation in November, 1966, regarding the possibilities that Mechanex might market the instrument on a national scale, Mr. Kramas insisted that a secrecy agreement be signed by a corporate officer of Mechanex before a consignment speedometer would be sent to Me-chanex for evaluation by the Mechanex Corporation (Plaintiff’s Exhibit K). Mr. Allen J. Stephens signed the secrecy agreement for the Mechanex Corporation and returned it by mail to the Plaintiff on December 5, 1966 (Plaintiff’s Exhibits L and M). The provision of said secrecy agreement is as follows:

The MECHANEX CORPORATION agrees to keep confidential all proprietary information regarding Electronic Speedometer furnished by K & K ELECTRONICS and not to use this information in any way detrimental to the interests of K & K ELECTRONICS. Further this information will not be distributed to a competitor of K & K ELECTRONICS or be used by MECHANEX to compete with K & K ELECTRONICS in the field of Electronic Speedometers.

Further details of the facts are set forth in the margin, for the convenience of the readers of this opinion. They are essential to a complete understanding of the issues ruled upon by the District Court, but not to an understanding of the controlling principles upon which this opinion is based.

The District Court, in its Memorandum Opinion of June 2, 1972, found that a valid and binding contract existed between the Plaintiff and Defendant for the distribution and sale by Defendant of a specific product of the Plaintiff; that the Defendant Mechanex had engaged in self dealing with the product in violation of contractual provisions (the electronic speedometer manufactured by the Defendant Mechanex being similar in appearance, operation and design and of the same general kind of product manufactured by Kodekey); that the manufacture of electronic speedometers by Defendant Mechanex was a clear violation and breach of the contractual agreement between Plaintiff and Defendant; that the Defendant Mechanex had engaged in unfair competition against Kodekey and had placed Kodekey in a disadvantageous position of marketing its electronic speedometer; that Plaintiff Kodekey was entitled to damages for the breach of contract and unfair competition; that the manufacture and merchandizing of the speedometer developed by the Defendant Mechanex violated the trust, confidence and fiduciary responsibilities imposed on Defendant Mechanex to the detriment and irreparable damage of Plaintiff Kodek-ey ; and that an adequate remedy at law to protect the contractual rights of the Plaintiff against actions not being present, and the Plaintiff having sustained its burden of proving the reasonableness of the restrictive covenants, that enforcement of the restrictive noncompetitive agreements by injunction was reasonable, and would not unduly injure the Defendants in their overall manufacturing operation.

II. ERRORS CLAIMED

Appellant urges seven errors. We will consider each in turn:

I. Did any information given to Mechanex by Kodekey constitute a “trade secret”?

II. Assuming one or more “trade secrets” were given to Mechanex, did Ko-dekey fail to take secrecy precautions essential to maintain such trade secret status?

III. If no “trade secrets” were given to Mechanex, did any other relationship exist between it and Kodekey which prevented Mechanex “from selling the speedometer developed by Mechanex”?

IV. Does the statute of frauds in Colorado prohibit the enforcement of the oral non-competition agreement found by the District Court to exist?

V. Is there sufficient evidence properly in the record to support the award of damages?

VI. Was injunctive relief appropriate?

VII. Was denial of a new trial error?

III. THE “TRADE SECRET” ARGUMENTS'

(Appellants Alleged Errors I, II & III)

Appellants base their first three alleged errors on an assumption that a “trade secret” disclosure by Kodekey to Mechanex was the sole content of their signed contract delivered , to Appellee on December 5, 1966; and that there were no other obligations subsequently created between the parties. This is not correct. The December 5, 1966 agreement was also an agreement not to compete and not to detrimentally use the information obtained (See Note 1, supra). But more important, the District Court found that the parties also entered into an operating contract, had subsequent oral conversations, written correspondence, and reciprocal commitments and actions, including voluntary representations to third parties. Mechanex Corporation obtained the exclusive right to purchase and sell, and did purchase and sell, in great quantities, Appellee's superior product. Mechanex was given the right to cancel the contract after the purchase of 3000 units, but was required to buy speedometers exclusively from Appellee during the term of the agreement, and within two years thereafter. This provision was reciprocal: Kodekey was required to accept or fill any purchase order, and if it did not, it would not offer to sell or sell to any other customer, foreign or domestic, for a similar period of two years. Mechanex further had a first right of refusal to market other new products of Kodekey during the terms of the contract. Under these contractual provisions, Mechanex purchased, between 1966 and 1970, some 12,000 speedometers.

In view of these facts, and the findings of the District Court which went far beyond the suggestion of Appellants that the court was merely dealing with trade secrets, we find the first three arguments of Appellant untenable. In this connection we point out the court’s specific findings.

“Damages awarded herein are assessed against Defendants for breach of contractual duties, breach of fiduciary responsibilities imposed on Mechanex, unfair competition, and for the breach of a secrecy agreement.” (Tr. Vol. VI, p. 535.)

Thus, were we to find there was no breach of a secrecy agreement relating to “trade secrets”, that does not invalidate the other facts, findings, and conclusions establishing liability of Defendants-Appellants on other grounds.

However, Appellants insist “the electronic speedometer . . . was a combination of generally known elements and components of electronic circuitry. Accordingly, whether or not the design should be accorded the status and the protection of a trade secret depends upon the uniqueness and value of the combination of elements . . . .”

The Restatement of Torts § 757, comment b at 6-7 (1939) is to the contrary. “Novelty and invention are not requisite for a trade secret as they are for patentability . . . (here a discussion of patent law). But such is not the case with a trade secret. Its protection is not based on a policy of rewarding or otherwise encouraging the development of secret processes or devices. The protection is merely against breach of faith and reprehensible means of learning an-others secret.” (emphasis added).

A recital of the conduct of the Appellant Mechanex which began very shortly after the original contact and contracts took place between the litigants is here extremely revealing.

Appellee very properly relies on the law as to what constitutes a trade secret is a question of fact for the trial court. (See Note 3, supra.) We cannot say the court’s conclusions on the facts herein are clearly erroneous. E. I. DuPont de Nemours & Co. v. United States, 288 F.2d 904, 911, 153 Ct.Cl. 274 (1961); Imperial Chemical Industries, Ltd. v. National Distillers & Chemical Corp., 342 F.2d 737, 742 (2d Cir. 1965) modified, 354 F.2d 459 (2d Cir. 1965); Head Ski Co. v. Kam Ski Co., 158 F.Supp. 919, 923 (D.C.Md.1958); Compare, Callman: Unfair Competition, Trade & Monopolies, § 52.1, pp. 371-73, and § 52.2, pp. 380-81, 390 (1968).

And as to the uniqueness of the speedometer, we note that the court found (Tr. Vol. VI, n. 8, p. 385), among other findings, that when Mechanex Corporation desired to merge with Defendant Tenneeo, Inc., in 1968, Mechanex stated that “there was no similar speedometer” on the market.

Finally, as to whether trade secrets were here involved.

“A trade secret may consist of any formula, patent, device, plan, or compilation of information which may be used in one’s business and which gives a person an opportunity over his competitor. The economic report in the case at bar is a study of the costs involved in the water transportation of LPG; its underlying contribution is to demonstrate the comparative advantage of such transportation over other methods of transportation. This report is manifestly integrated into the [Defendant’s] plans .... The [Defendant’s] plans palpably constituting a trade secret.
* * * * *
. [T]he proofs support the contention the economic report and the [Defendant’s] plan were trade secrets or, at least, plaintiff’s proprietary interest in them should, in law and equity, be treated the same as trade secrets; disclosure was made to the defendant in confidence . ” International Industries Inc., v. Warren Petroleum Corp., 99 F.Supp. 907, 914-915 (D.C.Del.1951) (emphasis added).

We find little merit in Appellants position that secrecy precautions were allegedly not taken by Kodekey. It took the primary and essential precaution in requiring a “secrecy-plus” agreement from Appellant prior to any disclosure.

As Callman, supra, states:

“An employee’s express agreement ‘not to disclose any of the processes and methods’ of his employer is a positive acknowledgement of the fact that some of such processes and methods are secret; the stipulation would otherwise be meaningless.” (Appellee’s Brief, p. 31 and Callman, p. 390.)

Such an interpretation applies with stronger reason to an agreement between a secret-holder and a non-employee than between owner and employee.

We think we are not required to discuss all cases cited by either side. We note we have a problem with some of Defendants’ references to their legal position. But we are satisfied that the Appellants’ first three alleged errors do not constitute error.

IV. STATUTE OF FRAUDS

Here the Appellant states that “the agreement” between the parties included the provision that Mechanex agreed not to compete with Kodekey in the manufacture or sale of electronic speedometers for a period of two years following the termination of the agreement—an agreement which obviously cannot be performed within a year. This was an oral agreement best set forth in the answer of Plaintiff to Defendant, Interrogatory No. 90 (Defendants’ Exhibit 202). Cf. Court’s Memorandum Opinion, p. 7.

Appellant relies upon Colo.Rev.Stats. § 59-1-12(1) (b) which states that any contract which cannot be performed within a year of the time of making, must be in writing and signed by the party sought to be charged. (Op.B. p. 28.) The holding below, says Appellants, flies in the face of “the only applicable Colorado law on this issue”; DeBord v. Holcomb, 13 Colo.App. 161, 57 P. 548 (1899). That case does hold, as Appellant suggests, that the general rule therein expressed “that the statute of frauds invalidates a two year contract not to compete, even though consideration has passed between parties for the sale of a business” is good law. But it also found that the violation of the oral agreement between the parties was the only wrongful act of the Defendant.

Then DeBord went on to say:

“. ... the principle upon which courts of equity will sometimes enforce specific performance of contracts, notwithstanding the formalities required by the statute of frauds have not been complied with, is not applicable to this class of cases. It is where the statute, which was designed to prevent fraud, is sought to be used for the purpose of a commission of a fraud, that equity affords relief. But the fraud against which equity will relieve notwithstanding the statute must consist of something more than the mere wrong of disavowing the contract; and, as the act of the defendants amounted only to a violation of their agreement, it does not constitute a fraud of such a nature as would authorize a court of equity to disregard the statute. Browne, Stat. Frauds, § 437 et seq. . . .” DeBord, supra, 13 Colo.App., at 163, 57 P. at 549.

Here the facts of the case clearly show that Defendant did “far more than the mere disavowing of the contract.” Cf. Findings & Conclusions in “Memorandum Opinion & Order.”

Appellee refers us to three citations where courts have equitably recognized oral agreements concerning trade secrets. Jones v. Reynolds, 120 N.Y. 213, 24 N.E. 279 (1890); Lepel H. F. Labs, Inc. v. Capita, 278 N.Y. 661, 16 N.E.2d 392 (1938); 6 A.L.R.2d 1053, 1061 (1949).

We agree with the District Court that the Colorado law does not bar recovery herein because of Colorado’s Statute of Frauds.

V. SUFFICIENCY OF EVIDENCE

Appellant argues the District- Court committed error in using figures which “were not properly in evidence”; because they were in Mechanex’ response to a “Motion to Produce” (VI R. 509-10), filed by Defendants over their objections and protest. The principal objection made by Defendants was that “the figures furnished require explanation to be properly understood.” (Op. Br. p. 31, et seq.) The explanation, as we understand Defendants’ brief, .is that “a sales figure of 5,532 units” during the six months period between June 2, 1972 through November 1972, “were made during a period of time when Defendants did not know whether their sale of electronic speedometers and tachometers could be continued or not. Me-chanex made every effort to deplete their stock on hand, and “sales were made, not to ultimate consumers, but to Mechanex distributors, on a ‘forced’ basis” ; that “but for the threat of the enforcement of the announced injunctive relief, such sales would never have been made at that volume.” (Op.Br. p. 32.) Also, that the court should have considered the sales of Kodekey during the same 1972 period in mitigation of damages.

Appellee relies strongly on two cases, i. e., Julius Hyman & Co. v. Velsicol Corp., 123 Colo. 563, 233 P.2d 977 (1951), which involved the wrongful use of trade secrets under a contractual and fiduciary relationship, and Grange Mutual Fire Ins. Co. v. Golden Gas Co., 133 Colo. 537, 298 P.2d 950, 955 (1956).

The first ease emphasizes the duty of the trial judge “when the issues of unfair competition, breach of contract, and violation of confidential and fiduciary relationship” are issues once determined in favor of plaintiff, the court in equity will retain jurisdiction to give complete relief.

Were we to assume that the court should not have considered the evidence produced by Defendants in answer to the Plaintiff’s Motion to Produce on the issue of damages, Plaintiff suggests there was ample evidence otherwise to support the District Court’s decision in Plaintiff’s Exhibits WWWWW and XXXX, and Defendants’ Exhibits 207 and 210A, 210B and 210C. While that may well be true, we are not required to determine that point, because we are not convinced it was error for the trial judge to consider Defendants’ response to the said Motion to Produce, hereinabove discussed. In fact, it is the better practice. Sinclair Refining Co. v. Jenkins Petroleum Processing Co., 289 U.S. 689, 53 S.Ct. 736, 77 L.Ed. 1449 (1933).

VI. WAS INJUNCTIVE RELIEF APPROPRIATE?

Appellants urge the grant of damages against them, plus the injunctive relief granted against them, result in double damages. This may well be the result if the damages in a case are limited solely to breach of contract. Thus the citation in Milgrem, Trade Secrets § 7.08 [1] [a] at page 7-59, is applicable to a simple breach of contract case, both by case law and logic, and usually by its express terms, but a different rule is expressed where other principles are involved, as here exist. Milgrem, Trade Secrets, § 7.08[1][b] — Misappropriation of Trade Secrets:

“[b] — Injunction Against Process or Product. Misappropriation of a process, formula or other trade secret matter used in the manufacture or preparation of a product is generally sanctioned by a restraint on the use of the process, formula or other trade secret. If, however, the secret is unex-tricably connected with defendant’s manufacture of the product the court may enjoin defendant from making the product itself.”
Cf. also Julius Hyman v. Velsical, supra; 38 A.L.R.3d 572, 574 (1971).

We find the injunctive relief granted was permissibly appropriate.

VII. MOTION FOR NEW TRIAL

We are satisfied the trial court committed no error in denying Appellants’ Motion for a New Trial, or a Partial New Trial, on the ground of Newly Discovered Evidence. Such a determination is not particularly favored by the courts, and rests largely and almost wholly within the sound judicial discretion of the trial court. Whether the newly discovered evidence would be likely to change the result of the District Court’s decision is one peculiarly within the determination of but one man —the trial judge. The mere fact one Brown did not consider the Kodekey design “in any way secret or unique” would not necessarily be material evidence for and by the court under the facts of this case. (See (a) discussion supra under alleged errors I, II and III; (b) Collman, supra at § 53.3(e) p. 404, and (c) Fairchild Engine & Airplane Corp. v. Cox, 50 N.Y.S.2d 643, 657 (Sup.1944) at Key paragraph 19, p. 656, 657.)

The judgment against Defendants is in all respects

Affirmed.

      . We note some difference in the language used by the parties to this appeal in describing this agreement.
      Appellants refer to it as an agreement covering “trade secrets”;
      Appellee refers to it as a “secrecy agreement” ;
      The agreement requires Appellant “to keep confidential all proprietary information furnished by Appellee, not to use this information in any way detrimental to the interests of Appellees, not to distribute (this information) to a competitor, or be used by Appellant to compete with (Appellees) in the field of Electronic Speedometers.”
      Thus the agreement’s existence and its precise terms are not in dispute. We suggest it is much more than either a secrecy agreement or an agreement covering “trade secrets”, only.

      . We use Appellee’s language :
      When Mr. Kramas traveled from California in December of 1966 to visit the Mechanex Corporation in Denver, he brought with him a completed unit, along with the brackets, cable, magnets, and a disassembled unit, so that the Mechanex Corporation could ascertain the internal workings, circuit board, and the specific electronic structure of the instrument (Tr. Vol. I, p. 28).
      Kodekey and the Mechanex Corporation formed an operating contract in the early months of 1967, the culmination and substance of which is set forth in Defendants’ Exhibit # 202. The contractual terms were supported and given credence by oral conversations, written correspondence between the parties, their course of dealings and reciprocal commitments and actions of the parties (See Plaintiff’s Exhibits O, P, S, T, V, W, X, Y, Z, UU and NNN). The bulk of the contractual provisions are also embodied in Defendants’ Exhibits 15, 15-A and 15-B; it was demonstrated at trial (Tr. Vol. II, pp. 267-70) that Defendant Mechanex submitted these documents to Plaintiff knowing that Mechanex would not have performed according to the provisions specified therein. Under the contractual provisions, Kodekey (and its predecessor K & K Electronics) would receive a purchase order from the Mechanex Corporation for 3,000 speedometers at a purchase price of $72.50 per unit plus E.E.T. Upon purchase of these units, the Mechanex Corporation would have the exclusive right to purchase and sell Plaintiff’s speedometers. The agreement was to continue so long as the Mechanex Corporation continued in its purchases. The parties agreed that after the Mechanex Corporation had purchased a total of 10,000 units, the parties would share equally in any cost saving over the cost of the original unit. Kodekey agreed to send 50 of its units for field testing, and if these units did not satisfactorily test for 50,000 miles, the Mechanex Corporation could cancel the order for the remainder of the 3,000 units. The Mechanex Corporation actually proceeded with additional large scale purchases prior to the time when the initial 50 units had completed the field tests. Additional purchases were frequently made by the Me-chanex Corporation without formal purchase orders.
      The contract further provided that the Defendant, the Mechanex Corporation, could terminate the agreement after the purchase of 3,000 units. Under the contract, the Me-chanex Corporation was not to manufacture, sell or otherwise deal in electronic speedometers manufactured by any firm except Ko-dekey Electronics during the term of the agreement or within two years thereafter. If Kodekey Electronics failed to accept or fill a purchase order, it would be prohibited from offering for sale or selling to any other customer, domestic or foreign, its electronic speedometer for a period of two years, and the Mechanex Corporation would be released from any obligation under the contract. The contract further provided that the Mechanex Corporation would be given a first right of refusal to market other new products of Kodekey during the term of the contract.
      The agreed purchase price of the speedometers in 1967 was $72.50, but pursuant to the agreement of the parties, this wholesale price to the Mechanex Corporation was reduced to $60.00 per unit during the contract period. The Plaintiff, Kodekey Electronics, readily passed on these manufacturing savings to the Mechanex Corporation; however, the Defendant, Mechanex, maintained its selling price to the industry at a minimum of $94.50 per unit.
      Between 1966 and 1970, the Mechanex Corporation purchased approximately 12,000 speedometer and tachometer units from Ko-dekey Electronics (Tr. Vol. II, p. 272).
      In October or November of 1967, Mr. Allen J. Stephens, the president of the Defendant Mechanex Corporation, approached Fab Tool Company of Denver, Colorado, or one of their employees, concerning the making of a circuitry board for an electric speedometer (Tr. Vol. II, pp. 272-3). Engineering work on the circuitry of the electronic speedometer was performed for the Mechanex Corporation at Fab Tool Company during 1968 by one Jerry Steele, until January of 1969, when Mr. Steele was hired full-time by the Mechanex Corporation (Tr. Vol. II, p. 275). Mr. Steele, prior to 1968 had never seen an electronic speedometer in operation, and had never seen illustrations of speedometer theory involving magnets (Tr. Vol. VI, p. 511) ; Mr. Steele began his engineering work by viewing a disassembled Kodekey unit provided to Mm by Defendant Mechanex Corporation (Tr. Vol. IV, pp. 513-15).
      On January 8, 1970, Mr. Allen Stephens of Mechanex telephoned Mr. Kramas of Kodekey, informing Mr. Kramas that the Mechanex Corporation would no longer purchase speedometers from Kodekey, and that Meehanex intended to sell electronic speedometers and tachometers which it would manufacture itself beginning in March, 1970. The Mechanex Corporation had not informed Mr. Kramas of the termination prior to this time, and refused at this time, to provide Kodekey Electronics with a customer list that -had been utilized in the sale of the units (Tr. Vol. II, p. 277). The Mechanex Corporation did not inform Kodekey of its intentions prior to this time, because Mechanex considered Kodekey to be a competitor, and Mechanex had continued the relationship while they were developing their own unit because Mechanex’ relationship with Kodekey was still of benefit to Mechanex (Tr. Vol. IV, pp. 568-69).

      . . [A] trade secret is not necessarily a secret within the common use of that word. It is at best a nebulous concept which at least the court has indicated is somewhat incapable of definition. [Sarkes Tarzian, Inc. v. Audio Devices, 166 F.Supp. 250, 257-258 (S.D.Cal.1958) (Applying California Law) ; aff’d 283 F.2d 695 (9th Cir. 1960), cert. den. 365 U.S. 869, 81 S.Ct. 903, 5 L.Ed.2d 859 (1961).] “ . . . The secrecy requirement is the catalyst which raises liability in the fiduciary or confidential relationship.” Sloan, Trade Secrets: Real Toads in a Conceptual Garden, 1 West.St.U.L.Rev. 131 (1973).

      . Appellants’ position with respect to a “trade secret,” which is actually not a “trade secret” — tho characterized as such by the secrecy agreement — largely, if not entirely, rests upon cases dealing with a covenant of secrecy made by an employee at the commencement of his employment, and his later discovery that the “trade secret” was non-existent. “A distinguishing qualification” (according to appellant) “which creates an exception to the general rule.” See Reply Brief, p. 17, and cases therein cited appearing in Note 11, Callman, § 53.3, p. 390. [L. M. Rabinowitz & Co. Inc. v. Dasher, 82 N.Y.S.2d 431 (Sup.1948) (employee) ; Nat’l Rejectors v. Trieman, 409 S.W.2d 1 (Mo.1966) (employee) ; Briggs v. Butler, 71 Ohio App. 48, 47 N.E.2d 812 (1942) (employee).] While we can agree with Appellant and Callman (Callman is herein used as referring to Callman, Unfair Competition, Trademarks and Monopolies, (Third Ed., Supp.1973)), that such exception is good law, we cannot agree it is here controlling, because (a) this is not such a factual case; i. e., involving an employee; and (b) the court’s findings of fact as to the nature of the confidential and fiduciary relationship existing between the parties herein, differ from the facts cited in the above noted cases, and others cited by Appellant.
      “What is a secret poses a question of fact to be determined by the court.” Callman, supra, § 53.3, p. 390. A trial court’s finding of fact is binding upon appellate courts, unless we find them clearly erroneous — a finding we cannot here make.

      . See again the last two paragraphs of Note 2, supra.

      . We note with, interest in, but without reliance upon, a lay opinion of the existence of diverse circuit rulings in this area of law:
      “When different circuit courts come to different conclusions the law is simply not the same throughout the country, (when) the Supreme Court lias refused to step in with a final ruling. . . . [T]he prevailing review in the Sixth Circuit . . . gives companies with unpatented technical know how almost no power to keep employees from taking it to. competing companies, even if they have signed contracts pledging not to do so. Four other appellate courts have ruled that the companies can enforce such contracts, and the question is uncertain in the other six circuits.” Business Week: “Law”, August 11, 1973, at 43.

      . Defendant’s state at pp. 26-27 of their brief that:
      “The Court’s conclusion that the electronic speedometer manufactured by Me-chanex after development by Fab Tool, Inc. was the ‘same’ as the Kodekey speedometer was in error.” (emphasis added) But the court did not find they were the “same”, but did find they were “similar.”
      “That defendant engaged in self-dealing with the product in violation of contractual provisions and the electronic speedometer manufactured by defendant is similar in appearance, operation and design and of the same general kind of product manufactured by plaintiff.” (emphasis added) Tr. Vol. VI, p. 390.

      . 1. Breach of contract for sale and distribution of speedometer. 2. Breach of contract of non-competition. 3. Breach of written contract for secrecy. 4. Violation of contract with respect to trade secrets. 5. Violation of fiduciary relationship.

      . “Defendants labor under the impression that their liability is limited entirely to damages resulting from a breach of contract. In this they are mistaken for in the complaint it is charged, and as we have heretofore shown, that the evidence established that defendants violated their confidential and fiduciary relationship, as well as their contractual. They all have been found guilty of being coconspirators in a plan to injure plaintiff and appropriate its property to their own use and benefit, and equity having acquired jurisdiction, it retains jurisdiction to give such complete relief as the facts require.’’ (citations omitted) (emphasis added) Hy-man, supra, 233 P.2d at 1007.
      The court in Hyman, supra at 1008 went on to state:
      “It is concededly impossible for plaintiff to produce competent evidence to show with a mathematical exactitude just what its loss was in dollars and cents by reason of defendant’s business methods. However, that fact alone does not deprive plaintiff of its right to damages as is contended by defendant. In this case plaintiff is entitled to damages in an amount which it would have realized from the sale of chlordane at reasonable prices except for the wrongful and deliberate interference of defendants.”

      . “The remedy of discovery is as appropriate for proof of a plaintiff’s damages as it is for proof of other facts essential to his case. (Id., p. 693, 53 S.Ct. p. 737.)
      “There are times when a suit is triable in separate parts, one effecting the right or liability, and the other effecting the measure of recovery. In suits of that order a discovery as to damages will commonly be postponed till the right or liability has been established or declared, (citations omitted)
      “. . . As a general thing it will be useless to decree it any earlier and may even be oppressive. ‘The principle of judicial parsimony’ (L. Hand, J., in Pressed Steel Car Co. v. Union Pacific Railroad Co., supra [240 F. 135], if nothing more condemns a useless remedy. This division of the trial into stages or installments will happen oftenest in suits in equity, though it is not unknown in actions at law where a jury has been waived. In equity it is common practice. Thus, a suit to establish a partnership or to restrain the infringement of a patent culminates, if successful, in an interlocutory decree, which will be followed by an accounting and a discovery of documents. In these and like oases, the accounts will not be probed until the right has been adjudged.” (emphasis added) Id. at 693-694, 53 S.Ct. at 737-738. “It is all a matter of discretion.” Id. at 697, 53 S.Ct. at 739. Cf. also 4 J. Moore Federal Practice ¶ 26.56(5) (1972).

      . “So here, ‘breach of faith and reprehensible means of learning another’s secret’ is the issue. To lose sight of everything elsé in pursuit of ‘prior art’ — ‘the kind of novelty and invention which is a requisite of patentability’ — is to become a fugitive from the premier if not the single issue to be apprehended and solved.
      “The defendant’s reply that what he proposed to do does not concern a ‘secret’ is contradicted "by his own conduct and words. Prom the mass of testimony the transcendent fact emerges that the plaintiff’s process succeeded where others failed. No one else achieved the practical results these plaintiffs achieved. To retort that others might or could have done it, or were on the same track, does not alter or weaken the fact that the plaintiffs did do it. The plaintiffs’ process ‘clicked’
      “[19] It is quite manifest that after this litigation was projected, the defendant commenced digging in the field of ‘prior art’ to ascertain what had been done and written about bonding aluminum with ferrous metals. Concededly, the field was not entirely virgin. But the plaintiffs’ expenditure of time and money brought results not reached by others. Once we conclude that the work done under Cox’s supervision was confidential, and that Cox threatens to breach the confidence, all else is of subordinate importance. As Mr. Justice Holmes succinctly said in E. I. DuPont de Nemours Power Co. v. Masland, supra, 244 U.S. [100] page 102, 37 S.Ct. [575], page 576, 71 L.Ed. 1016:
      “ * * * Whether the plaintiffs have any valuable secret or not the defendant knows the facts, whatever they are, through a special confidence that he accepted. The property may be denied, but the confidence cannot be. Therefore the starting point for the present matter is not property or due process of law, but that the defendant stood in confidential relations with the plaintiffs, or one of them. These have given place to hostility, and the first thing to be made sure of is that the defendant shall not fraudulently abuse the trust reposed in him.”


source: Caselaw Access Project

author: LEWIS, Chief Judge.

license: Public Domain

text:
    Mari Pruitt WEST, Plaintiff-Appellee, v. ALBERTO CULVER COMPANY, and Safeway Stores, Inc., Defendants-Appellants.
    No. 73-1153.
    United States Court of Appeals, Tenth Circuit.
    Argued and Submitted Aug. 13, 1973.
    Decided Oct. 29, 1973.
    Rehearing Denied Nov. 27, 1973.

      J. Fern Black, Sheldon, Bayer, McLean & Glassman, Denver, Colo., for defendants-appellants.
    Robert L. McDougal, Denver, Colo. (Gertrude A. Score, Denver, Colo., with him on the brief), for plaintiff-appellee.
    Before LEWIS, Chief Judge, and BARNES and McWILLIAMS, Circuit Judges.

       Of the Ninth Circuit, sitting by designation.

   LEWIS, Chief Judge.

This is an appeal from a judgment on a verdict for $10,000 in a Colorado diversity case involving plaintiff West’s claim for personal injury following the use of a product manufactured by Alberto Culver Company and sold by Safeway Stores, Inc. After return of the jury verdict defendants filed a motion for judgment notwithstanding the verdict and for a new trial limited to the issue of damages. The motions were denied and this appeal follows.

Plaintiff purchased a bottle of Alberto Balsam Super Hair Conditioning Formula after viewing a commercial advertisement on a local television station in October 1971 and after examining the. label of the product in the Safeway Store several days later. Shortly thereafter plaintiff used the product on her hair according to the directions on the label, whereupon a gluey substance developed in her hair which became stiff and hardened. Plaintiff realized something was wrong when the product would not rinse out. After repeated washings the gluey substance that was twisting her hair remained embedded.

Plaintiff subsequently sought the aid of beauticians, a chemist and a dermatologist to remove the resin from her hair without the necessity of cutting her thirty-four-inch long hair. She occasionally wore a borrowed wig and later purchased a wig. Finally, in February of 1972, due to a lack of other advisable recourse, she cut the substance from her hair leaving her with about a half inch of hair. For a four-month period plaintiff did not work or leave her home other than to drive her mother to work or to run an occasional errand because of being embarrassed and humiliated.

Plaintiff testified to relying upon the language of the television commercial and the language on the label of the bottled product for her expectations regarding the results of the use of the product. Witnesses testified that prior to use of the product plaintiff’s hair was long, in good condition and, moreover, that plaintiff’s hair was an apparent great source of pride to her.

Dr. Cole, a chemist, testified that he had examined microscopically a sample of the product used by the plaintiff and a sample of the product from a newly purchased bottle. He related that the product plaintiff had used contained a clear “hyaline like” material and bacteria which were not found in the purchased sample. His tests with samples of plaintiff’s hair showed that petroleum' ether would dissolve Hie substance in the hair but this treatment was not recommended because of the possible dangerous effects. The chemist also attempted to remove the substance from plaintiff’s hair through normal procedures, such as using boiling-hot water and soap, but concluded that it was not water soluble. Dr. Cole then applied the product which plaintiff used to some hair from another person and the effects were the same, namely, matting and twisting of the hair. Dr. Philpott, a dermatologist, testified that he examined plaintiff’s hair physically and microscopically and that he advised plaintiff to cut her hair after all the unsuccessful attempts to remedy the situation. Both expert witnesses testified that plaintiff suffered no permanent damage to her hair and neither conducted a chemical analysis nor attempted to break down the secret formula of the product which would have cost about $35,000.

Defendants’ evidence was limited to an account of the manufacturer’s quality control procedures.

After a motion for a directed verdict in favor of defendants was denied the case was submitted to the jury with the result indicated.

Defendants make no appellate contention that the trial court erred in its instructions to the jury and the instructions have not been made a part of the record on appeal. We must adopt the premise, therefore, that defendants made no objection to the instructions and that our review is limited to a consideration of whether the totality of the evidence is sufficient, under any acceptable legal theory, to allow submission to the jury and to the particularized contention that the damages allowed were excessive as a matter of law.

We have no difficulty in holding that plaintiff established a prima facie case of breach of warranty and injury resulting from that breach. Plaintiff used the product according to the manufacturer’s directions and for its intended use. The product was shown to be contaminated and an inference of proximate cause may arise from the fact of proven injury following use of the product. See Procter & Gamble v. Langley, Tex.Civ. App., 422 S.W.2d 773. So, too, the product was shown to be harmful to other hair. The evidence presents classic proof of breach of implied warranty for fitness of use and resultant injury. We simply reject defendants’ contention that plaintiff had the burden of providing a chemical analysis of the product to establish that the product contained inherently harmful ingredients. Nothing in the law requires a consumer to conduct exorbitantly costly tests to unravel a closely guarded secret formula.

Defendants contend that the verdict of $10,000 is unreasonable and excessive. They argue that the trial court erred in not awarding a remittitur or setting aside the jury verdict and ordering a new trial on the question of damages. We find no error. It is well settled in the law that an appellate court, in reviewing determinations by the jury and the trial court, is necessarily limited. The reviewing court must view the evidence in the light most favorable to the plaintiff and give her the benefit of all inferences that may reasonably be drawn therefrom and we should not set aside a finding or affirmation of a finding unless it is clearly erroneous. Hart v. Western Investment & Development Co., 10 Cir., 417 F.2d 1296; Lindsey v. Oregon-Washington Plywood Co., 10 Cir., 287 F.2d 710. Plaintiff was justified in making exhaustive and prolonged efforts to preserve her natural hair. The amount of the verdict did not shock the judicial conscience of the trial court nor does it shock this court.

Affirmed.

      . The secrets of a well-kept beauty salon secret is now ready for use at home.
      On this side I’m using this new discovery called Alberto Balsam. It combines cream rinse and conditioners in one easy step. To prevent tangles like these, salons use this exact formula for tangle-free combing. And, for damaged hair, Alberto Balsam replaces thirty-minute conditioning treatments.
      Use it regularly and even damaged split ends disappear. New Alberto Balsam combines cream rinse and conditioners.

      .
      ALBERTO BALSAM SUPER CONDITIONING FORMULA Extra conditioners for extra dry hair. Especially formulated for hair that is dry and brittle due to bleaching, coloring, or electric curlers.
      ALBERTO BALSAM is an entirely new kind of hair beautifier that actually does two jobs in one sixty-second step! Replaces all types of creme rinses and conditioners — and does more than either.
      This extra-rich Balsam blend contains special conditioning emollients to add life to dull, dry hair. As it smoothes out tangles, it deep conditions to help seal split ends and revitalize damaged hair. Adds healthy, lively lustre that lasts and lasts. Sixty-seconds and your hair will look and feel thicker and stronger than it ever could after using a creme rinse or conditioner alone.

      . Defendants do not argue these issues as such but limit their contention to a claim that plaintiff did not prove an express warranty existent in the advertising and labeling of the product. As we have indicated this limited approach to the issue is not preserved for appellate review.


author: SOLOMON, District Judge: TRASK, Circuit Judge

text:
    EVERETT STEAMSHIP CORPORATION, S/A, Appellant, v. LIBERTY NAVIGATION AND TRADING CO., INC.; SS GALICIA LEE, ex SS NORBERTO CAPAY, her engines, tackle, etc.; SS GALICIA DEFENDER, ex SS SANTA EMILIA, her engines, tackle, etc.; SS GALICIA NAVIGATOR, ex SS OUR LADY OF PEACE, her engines, tackle, etc., and the United States of America, Appellees.
    No. 71-1009.
    United States Court of Appeals, Ninth Circuit
    Oct. 5, 1973.

      Francis L. Tetreault (argued), of Graham & James, San Francisco, Cal., for appellant.
    William E. Gwatkin, III (argued), U. S. Dept, of Justice, Lillick, McHose, Wheat, Adams & Charles, James Browning, Jr., U. S. Atty., San Francisco, Cal., for appellees.
    Before HAMLIN and TRASK, Circuit Judges, and SOLOMON, District Judge.

       Honorable Gus J. Solomon, United States Senior District Judge for the District of Oregon, sitting by designation.

   SOLOMON, District Judge:

Everett Steamship Corporation (Everett), a Panamanian corporation, filed this action against the United States (the Government) to recover on maritime liens on the SS Galicia Defender. The District Court granted summary judgment against Everett. Everett appeals.

The Government time chartered the Galicia Defender from Liberty Navigation and Trading Co., Inc. (Liberty). While under the time charter, Everett was the husbanding agent for the vessel. Between February 1, 1967, and February 2, 1968, when the vessel was in far eastern ports, Everett advanced $20,040.-47 for .repairs, supplies, and wages for the crew. Everett claims a maritime lien against the vessel for those amounts.

In May, 1968, the Galicia Defender, loaded with cargo for Vietnam, lay idle in the Port of San Francisco because Liberty could not pay the crew. Rather than bear the expense of unloading the cargo, the Government suspended the time charter and, on May 4, 1968, demise chartered the vessel for a round trip voyage to Vietnam.

On June 24, 1968, the Galicia Defender returned from Vietnam. It entered the Port of Oakland where it was seized in an in rem action brought by West Coast Ship Chandlers and others. The Government declared the Galicia Defender off-hire and the vessel was sold to pay maritime liens. Everett intervened. It recovered only $1,935.00 because other liens had higher priority.

Five weeks before the seizure in the in rem action and when the Galicia Defender was outside the territorial waters of the United States on her way to Vietnam, Everett filed this action. The complaint alleged that the United States, as demise charterer, was owner pro hac vice, 46 U.S.C. § 186, and that Everett was unable to libel the vessel in rem because of 46 U.S.C. § 741. The complaint claimed a maritime lien on the Galicia Defender and asserted that the lien was enforceable against the Government by a libel in personam under the Suits in Admiralty Act, 46 U.S.C. § 742.

In its answer the Government alleged that the court lacked jurisdiction because the vessel was outside the territorial waters of the district and asserted that 46 U.S.C. § 742 did not apply because no action could have been maintained if the vessel had been privately operated. The Government also stated that the vessel was on its way to Vietnam and would be redelivered to its owner upon its return to the United States.

The District Court dismissed the complaint with leave to amend in an order dated May 28, 1970. Everett then filed an amended complaint in which it also claimed damages against the Government for the loss of priority of its lien because 46 U.S.C. § 741 prevented it from libeling the vessel in rem. On October 6, 1970, the court granted the Government’s motion for summary judgment. The court held that Everett’s inability to libel the Galicia Defender was because of the vessel’s absence from the jurisdiction and not because of any immunity under Section 741. The court also ruled that the arrest and sale of the ship did not violate Section 741.

The Suits in Admiralty Act (the Act) prohibits maritime lienholders from seizing vessels in in rem actions if the vessels are owned or operated by the United States. 46 U.S.C. § 741. As a substitute for recovering against the vessel, the Act allows lienholders to enforce their liens through in personam actions against the Government. 46 U.S.C. § 742. The Act reserves to the United States the benefits of all exemptions and limitations of liability accorded by law to owners, charterers, operators, or agents of vessels. 46 U.S.C. § 746. The Act also seeks to protect government vessels from seizure in foreign ports by giving the Secretary of State discretion to intervene in foreign proceedings. 46 U.S.C. § 747.

As a demise charterer the Government was liable only in rem for debts incurred on the credit of the vessel before the demise charter. When Everett filed its complaint on May 17, 1968, the District Court had no in rem jurisdiction since the vessel was outside the waters of the United States. Blamberg Bros. v. United States, 260 U.S. 452, 43 S.Ct. 179, 67 L.Ed. 346 (1923).

Everett argues that the District Court had jurisdiction over an in personam action under Section 742 to enforce an in rem liability even though the vessel libeled was not within the territorial waters of the United States. Everett contends that Section 742 transformed its in rem rights into an in personam cause of action.

There is no merit in this contention. In all of the cases Everett cites to support this contention, the Government had in personam liability under the common law or the law of admiralty. No case held that an in rem action was made in personam by Section 742 for the purposes of jurisdiction.

In Eastern Transportation Company v. United States, 272 U.S. 675, 47 S.Ct. 289, 71 L.Ed. 472 (1926), the Government breached its statutory duty to mark the wreck of a government-owned merchant vessel that sank in a navigable channel. Plaintiff’s barge collided with the sunken wreck and sank. The trial court held that the sunken vessel did not provide a res which would support an in rem action. The Supreme Court reversed. It held that the breach of the duty to place a marker on the wreck created a direct cause of action in tort against the Government for which plaintiff could maintain an in personam action. When the Government had in personam liability, Section 742 did not require that damages be limited to the value of the vessel under in rem principles.

In Hoiness v. United States, 335 U.S. 297, 69 S.Ct. 70, 93 L.Ed. 16 (1948), a seaman was injured aboard a merchant vessel owned by the United States. The complaint did not allege that the plaintiff was a resident of the district in which the action was brought or that the vessel was within the district when the complaint was filed. The District Court dismissed for lack of jurisdiction. The Supreme Court reversed and held that the provision in Section 742 that the plaintiff be a resident of the district or that the vessel be located within the district related to venue and not jurisdiction.

The broad holding in Hoiness must be read in connection with the facts of the case which show in personam liability. The defect there was not jurisdictional because the Government had in person-am liability for injuries suffered on government-operated merchant vessels. The opinion did not cite Blamberg or discuss jurisdictional requirements when the Government had in rem liability only.

Everett contends that even if the court did not have jurisdiction when the complaint was filed, it acquired jurisdiction when the Galicia Defender returned to United States waters. Everett cites Warren v. United States, 179 F.2d 919 (2d Cir., 1949), rev’d on other grounds, 340 U.S. 523, 71 S.Ct. 432, 95 L.Ed. 503 (1951), and Carroll v. United States, 133 F.2d 690 (2d Cir. 1943). Both Warren and Carroll were cases in which the Government was liable in personam, not in rem, and Warren’s holding was limited to venue, not jurisdiction.

Even if the court did acquire jurisdiction, Everett would not be entitled to any relief. The Government would be liable only for the value of the vessel, just as a private demise charterer in an in rem action. See The Minnesota, 20 F.2d 926, 928 (E.D.La.1927). Even before its first complaint was dismissed, Everett had already received all the relief to which it was entitled because it had received its pro rata share of the value of the vessel, based on the priority of its lien.

Everett claims that the United States is liable in damages for the loss in value of its maritime lien. It asserts that during the period that the Galicia Defender was under the time charter, as well as when it was under the demise charter, the vessel was immune from arrest by virtue of Section 741. Everett argues that it was impractical for political and economic reasons to libel the vessel in Vietnam or in any other foreign port and that the Government prevented it from arresting the vessel before the higher priority liens accrued.

In the District Court Everett admitted that it had no legal authority to support this “novel approach”. There was nothing to prevent Everett from bringing this action under Section 742 many months earlier when the Galicia Defender was in a port of the United States or from seizing it in a foreign port. The Government is not responsible for the loss in value of Everett’s lien caused by its own delay in failing to pursue the remedies allowed by law.

Everett also contends that the Government did not have the right to release the Galicia Defender to its creditors because vessels operated by the United States are immune from in rem execution under Section 741. It relies on Hudson Trading Company v. United States (THE ABERFOIL), 28 F.2d 744 (3rd Cir. 1928).

Section 746 reserves to the United States the benefit of all exemptions and all limitations of liability accorded by law to owners, charterers, operators, or agents of vessels. In our opinion Section 746 qualifies Section 741 and allows the Government to permit judicial seizure of merchant vessels chartered by the Government when necessary to enable it to limit its liability according to law. See 46 U.S.C. § 185. The Court in THE ABERFOIL did not consider the interrelation of these two sections.

To the extent that the majority opinion in THE ABERFOIL holds that the Government could not release the vessel to the lienors and could not waive its immunity under Section 741, we think that the majority opinion is incorrect and choose not to follow it.

Section 742 does not give a lien-holder greater rights against the Government than it would have against a private charterer. See McMahon v. Pan American World Airways, Inc., 297 F.2d 268, 269 (5th Cir. 1962); see also State of Maine v. United States, 134 F. 2d 574, 575 (1st Cir. 1943), cert, denied, 319 U.S. 772, 63 S.Ct. 1437, 87 L.Ed. 1720 (1943), cited in Allen v. United States, 338 F.2d 160, 162 (9th Cir. 1964), cert, denied, 380 U.S. 961, 85 S. Ct. 1104, 14 L.Ed.2d 152 (1965). Everett was unable to libel the vessel because she was on the high seas, not because it was owned by the United States: Everett would have been equally unable to seize the vessel had it been privately owned. Everett recovered in the in rem action the full amount to which it would have been entitled as a lienholder against a privately operated vessel. It is entitled to no more.

Affirmed.

TRASK, Circuit Judge

(dissenting):

I respectfully dissent.

The majority reasons that the district court had no jurisdiction to grant relief to Everett because the Galicia Defender was outside the territorial waters of the United States when the original complaint was filed. That complaint alleged that the vessel would be within the geographical jurisdiction of the court during the pendency of the action.

On June 17, 1968, the United States filed an answer in which it admitted that the vessel was expected within the jurisdiction on or about June 26, 1968. It denied that there was any process pending for her arrest at the instance of Everett. It also alleged as a separate defense that the court lacked jurisdiction because the vessel was outside the waters of the district.

That defense was not called to the attention of the trial court until August 12, 1969, by a motion for judgment on the pleadings. In the meantime, however, on June 24, 1968, the Galicia Defender entered the territorial waters of the district and proceeded to San Francisco where she arrived at 1918 hours Pacific Daylight Saving Time on June 24, 1968. At the time the motion for judgment on the pleadings was heard on September 12, 1969, the defect that the vessel was outside the jurisdiction had been cured. Indeed, the trial court’s order did not even mention this defense of lack of jurisdiction but denied relief for failure of the complaint to allege a cause of action upon which relief could be granted. It allowed Everett twenty days within which to file an amended complaint.

The order granting summary judgment from which the instant appeal was taken was addressed to that amended complaint. It was filed June 17, 1970. Again, it alleged the existence of facts which would support its claim of a maritime lien, the time and demise charters to the United States which prevented Everett from seizing or arresting the Galicia Defender and its reliance therefore upon the Suits in Admiralty Act, 46 U.S.C. §§ 741, 742 for in personam relief. The majority does not consider the problem. It is content with the explanation that section 742 does not give the lienholder “greater rights against the Government than it would have against a private charterer.” Since Everett recovered a pro rata share of the proceeds from the in rem proceeding in which it intervened against the ship, the majority say that it is entitled to no more.

But the very purpose of the Act is to permit not only a recovery in rem, but one in personam as well, when the claim is within the framework of the statute. Section 743 provides in part:

“If the libelant so elects in his libel, the suit may proceed in accordance with the principles of libels in rem wherever it shall appear that had the vessel or cargo been privately owned and possessed a libel in rem might have been maintained. Election so to proceed shall not preclude the libelant in any proper case from seeking relief in personam in the same suit. ” . . . "

The majority argue that the limitation of liability provision of the Act, 46 U.S.C. § 746, precludes recovery by Everett of any sums in excess of its pro rata share of the total amount of liens against the vessel in the in rem proceeding. They cite McMahon v. Pan American World Airways, Inc., 297. F.2d 268 (5th Cir. 1962). It does not so hold. Nor do any of the cases cited by the Government. What they do hold is that Aberfoil), 28 F.2d 744, 747 (3rd Cir. 1928).

“The extent of his damages is measured by the value of the vessel at the time his libel is filed, when she could be seized, if privately owned.” Hudson Trading Co. v. United States (The

Even this quoted liability in rem is placed in question by Eastern Transportation Company v. United States, 272 U.S. 675, 47 S.Ct. 289, 71 L.Ed. 472 (1927), where the offending vessel was a complete wreck, yet in personam liability was sustained without limitation.

Here it is plain that Everett elected to and did proceed in rem; it is also clear that it continued to insist on its in per-sonam remedy against both the United States and against Liberty, the owner under its appointment as husbanding agent. It is entitled to try its case.

I would remand to the trial court for further proceedings consistent with the views expressed herein.

      . The complaint was one in intervention in a libel filed by Oakland Dock & Warehouse Company and then pending against Galicia Defender and two sister ships. The United States answered voluntarily according to the record here. An order was made consolidating seven separate libels but preserving the distinction between the libels of others and that of Galicia Defender.

      . Under these circumstances Blamberg v. United States, 260 U.S. 452, 43 S.Ct. 179, 67 L.Ed. 346 (1923), does not apply. In that case the vessel against which relief under the Act was asserted, was, at the date of the filing of the libel, in a foreign port where it remained at all times thereafter. Cf. Eastern Transportation Co. v. United States, 272 U.S. 675, 47 S.Ct. 289, 71 L.Ed. 472 (1927) ; Warren v. United States, 179 F.2d 919 (2 Cir. 1949).

      . The original complaint as well as the amended complaint asserted maritime lien claims for advances for the payment of crew’s wages and furnishing of repairs, supplies and other necessaries. In the amended complaint for the period between February 1, 1967 and February 2, 1968, the amount was alleged to be the sum of $20,040.47. Such advances create maritime liens, 1 Benedict on Admiralty 17-20 (6th ed., 1940), and were the vessel privately owned and operated, a proceeding in admiralty could be maintained to enforce them. Claim was also asserted ex contractu against Liberty, as owner, under Everett’s appointment by Liberty as husbanding agent for the ship. A “husbanding agent” or “port agent” is one who assists the vessel and its master in getting in and out of port, purchases supplies and stores, advances funds for payment of wages, procures repairs, etc. Dorn v. Balfour, Guthrie & Co., 155 F.Supp. 203 (N.D. Cal.1958), aff’d. 262 F.2d 48 (9th Cir. 1958).

      . Suits in Admiralty Act, March 9, 1920, 41 Stat. 525; 46 U.S.C. §§ 741-752. The Act provides in pertinent part:
      “§ 741 Exemption of United States vessels and cargoes from arrest or seizure “No vessel owned by the United States . . . or in the possession of the United States . . . and no cargo owned or possessed by the United States . . . shall, in view of the provision herein made for a libel in personam, be subject to arrest or seizure by judicial process in the United States or its possessions: Provided, That this chapter shall not apply to the Panama Railroad Company.”
      “§ 742 Libel in personam
      “In cases where if such vessel were privately owned or operated, or if such cargo were privately owned or possessed, or if a private person or property were involved, a proceeding in admiralty could be main-táined, any appropriate nonjury proceeding in personam may be brought against the United States .... Such suits shall be brought in the district court of the United States for the district in which the parties so suing, or any of them, reside or have their principal place of business in the United States, or in which the vessel or cargo charged with liability is found. The libelant shall forthwith serve a copy of his libel on the United States attorney for such district and mail a copy thereof by registered mail to the Attorney General of the United States, and shall file a sworn return of such service and mailing. Such service and mailing shall constitute valid service on the United States . . ...”

      . The fact that some portion of the claim may have been incurred prior to the demise charter to the United States does not defeat recovery. The recovery sought against the United States is not ex contractu, but on a statutory right granted as quid pro quo for preventing the creditor from arrest and seizure of the ship in assertion of ordinary maritime liens.


author: McCREE, Circuit Judge.

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Julius WEST, Defendant-Appellant.
    No. 72-1946.
    United States Court of Appeals, Sixth Circuit.
    Argued Feb. 16, 1973.
    Decided Oct. 31, 1973.
    J. Warren Eardley, court appointed, Grand Rapids, Mich., on brief, for defendant-appellant.
    John Milanowski, U. S. Atty., Robert C. Greene, Asst. U. S. Atty., Grand Rapids, Mich., on brief, for plaintiff-appel-lee.

      Before PHILLIPS, Chief Judge, McCREE, Circuit Judge, and WILSON, District Judge.

       The Honorable Frank W. Wilson, Chief Judge, U. S. District Court for the Eastern District of Tennessee, sitting by designation.

   McCREE, Circuit Judge.

In this appeal from conviction of bank robbery, use of a firearm to commit a felony against the United States, and killing of a bank employee in the course of the robbery, we are asked to determine whether the prosecution’s opening statement and its calling of a reluctant witness constitutes reversible error and whether two searches, one with and one without a warrant, were lawful. We affirm the judgment.-

On January 10, 1972, at approximately 1:30 p. m., a branch of the First National Bank of East Lansing, Michigan, an institution insured by the Federal Deposit Insurance Corporation, was robbed of approximately $15,000 by a male posing as a female. The branch manager, a retired 62 year old former school teacher, struggled with the bandit in an attempt to prevent the. robbery and was fatally shot.

Appellant was arrested on January 12 and the grand jury returned a three-count indictment. Appellant moved to suppress evidence taken from his apartment pursuant to an alleged consent search on January 11 and another conducted the following day under the authority of a search warrant. The motion was denied and a jury trial ensued in which West was convicted on all counts. He received a twenty year sentence for the bank robbery, a ten year sentence for possession of a weapon in the perpetration of the robbery, and a life sentence for homicide. The sentences are to run concurrently. The proceeds of the robbery had not been recovered at the time of trial.

The government’s evidence, not affected by appellant’s charge of incompetency, follows.

In July or August 1971, appellant, in a conversation with his brother-in-law, said that the bank on Lake Lansing Road would be easy to rob because it was located in a secluded place. They discussed the feasibility of a robber disguising himself as a woman.

Julius West customarily wore a mous-tache and goatee, but on January 9, 1972, he was observed to be clean-shaven. On January 10, 1972, shortly before 2 p. m., an automobile, later found to be registered in the name of appellant’s wife, was driven into a service station on Lake Lansing Road in the vicinity of the bank. The automobile was unmistakably distinctive: a 1963 or 1964 green or dark blue Ford automobile with the headlights smashed in and the hood tied down by a piece of colored plastic string that was described as looking like a child’s jump rope. The driver was identified as a lady and she and the other occupant wore “large Afros”. They asked to have their water cheeked because the radiator was steaming. The attendant testified that the vehicle departed in the direction of the bank.

Other witnesses observed the same vehicle with two passengers on Lake Lansing Road at about this time. They described the occupants as colored, with “Afro hairdos”, and their attention was attracted by the damaged front end and the tied down hood. One of these witnesses saw the car parked in the bank parking lot shortly before 2 p. m, that day. He noticed that steam was escaping from its radiator and that a woman was attempting to tie the hood down with a ‘ multi-colored string. She spurned his offer of assistance. He observed that there was a passenger whom he thought to be a woman. Two of these witnesses later identified the same vehicle in the parking lot at appellant’s apartment.

The bank teller, the only other person besides the branch manager who was in the bank before the bandit entered, testified that a man disguised as a woman and wearing a black and green tweed coat, a large “Afro” wig, earrings and black slacks, approximately five feet eight inches tall, clean-shaven with clear complexion and large lips, entered the bank at approximately 1:80 p. m. She described his actions and narrated the efforts of the manager to overpower the robber and how the manager was shot several times with a silver or aluminum colored handgun. Although she could not identify appellant at a showup or at the trial, she identified a coat that belonged to appellant’s wife as similar to the one worn by the robber.

Appellant’s brother’s common-law wife, Pauline Rogers, lived in the same building in which appellant’s apartment was situated. She testified that on the evening of January 10, she saw appellant holding a large number of $50 bills and other denominations and that he dropped some of the money. She recovered about $62 of the money he dropped and hid it on her person. She said that appellant boasted to his brother that he and. his wife had robbed a bank in East Lansing that day and that he had shot a man five times. He said that he was dressed as a woman with a natural wig, earrings, coat, big pocketbook and a slack suit. She identified a chrome or nickel-plated Smith & Wesson revolver as her husband’s gun and said that appellant had access to it. She said that on the evening of the robbery her husband'gave her the gun and that she hid it first in her niece’s backyard and later gave it to her brother to hide for her. Her brother, Andrew Perkins, buried the gun near Charlotte, Michigan, a neighboring community. Perkins later took law enforcement officers to the place where he had buried the gun and it was recovered. Ballistics tests established that the bullet removed from the body of the slain branch manager had been fired from the revolver recovered at Charlotte, Michigan.

Pauline Rogers also testified that appellant’s wife, her sister-in-law, gave her a coat earlier identified by the bank teller as one similar to that worn by the robber. Pauline Rogers first gave the coat to a girlfriend who returned it when she learned about its recent use. Then, she gave a man $10 to burn the coat or otherwise dispose of it but his attempt to burn it failed and he returned it. She later surrendered the coat to an FBI agent.

A fellow inmate testified that West, while he was in custody awaiting trial, told him, “they could not prove it was me because nobody could identify me.”

Undisputed laboratory tests revealed that a hair fiber found on the woman’s coat was similar to hair obtained from Julius West, and that two hairs found on the coat were similar to hair obtained from the head of the deceased branch manager. Also, fibers from the coat matched fibers found in the branch manager’s tie clasp, and fibers from the victim’s clothing matched fibers from the coat recovered from Pauline Rogers.

Appellant took the stand in his own behalf and testified that he had been suffering from an arthritic spinal condition on January 10 and that he had remained home alone and in bed all that day. He denied any involvement in the bank robbery and said that his wife’s black and green tweed coat had been stored in the basement of his apartment building and that he believed she had not been wearing it. He admitted that he wore a moustache and goatee before January 10, 1972, but explained that he shaved them off because he had acci-dently cut off one side of his moustache and that he removed the other half and his goatee when he became the object of ridicule with only a goatee. He admitted that the automobile that had been observed at the bank was registered in his wife’s name but stated that it belonged to his son-in-law who was too young to register it in his own name.

Appellant’s first contention of error is that he was denied a fair trial when the United States attorney outlined in detail in his opening statement the expected testimony of Timothy Williams, appellant’s stepson, who thereafter did not testify as predicted. He contends that the United States attorney’s conduct in calling Timothy Williams to the stand, even after he had been granted immunity, constituted the denial of a fair trial.

In his opening statement, the United States attorney outlined the evidence he expected from all the witnesses and included a summary of the evidence he expected from Timothy Williams. He told the jury that he expected that Timothy would testify that he did not attend his high school classes on January 10 and that he was home after two o’clock when his stepfather and mother returned; that his stepfather was dressed as a woman; that his stepfather inquired from his mother whether they had obtained any “ones”; and that his stepfather asked him to unfasten a brassiere which he was wearing.

Timothy Williams had given a statement substantially to this effect to investigating FBI agents, and, at the trial, the United States attorney called Timothy Williams as a witness. Defense counsel requested that the jury be excused and then suggested to the court that Williams might incriminate himself if he should testify consistently with the statement which defense counsel had been permitted to examine. The court examined the witness out of the presence of the jury and decided to appoint an attorney to represent him because of the possibility of self-incrimination and because he was only 16 years old. Accordingly, he was temporarily excused from testifying.

While the trial proceeded with other witnesses, the government obtained an immunity order for Timothy Williams pursuant to 18 U.S.C. § 2514. Thereupon, the court and the lawyer appointed to represent him explained to him that he could no longer assert the privilege against self-incrimination. Williams then was recalled to the stand and, after testifying that he lived with his stepfather and mother, said that he preferred not to answer the questions whether his parents left the apartment on January 10. Although the court instructed him to answer, he refused. He testified that he had seen his mother wear the coat that had been received in evidence, denied that he had seen the gun, and said he preferred not to answer the question whether his stepfather had a moustache and goatee prior to January 10. He also declined to answer this question when the court instructed him to do so. He admitted that he took part of a wig in his tennis shoes to his locker at school but denied he knew who put the parts of the wig in his shoes. He did not recall whether his stepfather came home wearing a green coat and a brassiere, or whether he was asked to help unfasten the brassiere.. The court took no action against Timothy Williams for declining to answer as instructed. Defense counsel timely moved for a mistrial.

At the outset, we observe that this is not a case where an inflammatory opening statement was made to poison the minds of the jury against a defendant or to destroy his credibility before any evidence should be presented. Cf. United States v. Signer, 482 F.2d 894 (6th Cir., 1973). Nor is it a case where the prosecution made an opening statement in bad faith without any reasonable expectation of presenting the promised evidence. See San Fratello v. United States, 340 F.2d 560 (5th Cir. 1965). And it is not a case where a prosecutor, in his questioning of a witness who claimed his privilege against self-incrimination, employed improper examination techniques such as reading the entire transcript of an FBI interview to see whether the witness would contradict it, United States v. Compton, 365 F.2d 1 (6th Cir. 1966); or persistently asking the same questions that had been repeatedly answered in the negative, Jones v. United States, 119 U.S.App.D.C. 213, 338 F.2d 553 (1964); or prefacing questions with the inquiry “did you tell me” in such a manner as to place in issue the prosecutor’s credibility, United States v. Puco, 436 F.2d 761 (2nd Cir. 1971). Here appellant does not accuse the prosecution of any misconduct and we find none.

Appellant contends, nonetheless, that error was committed because the opening statement placed before the jury the testimony of Timothy Williams, testimony that appellant could not test by cross-examination because the witness refused to be examined on the critical matters related. Accordingly, he claims his constitutional right to be confronted by the witnesses against him was abridged. See Douglas v. Alabama, 380 U.S. 415, 85 S.Ct. 1074, 13 L.Ed.2d 934 (1965).

However, we determine that the facts in this case bring it within the rule of Frazier v. Cupp, 394 U.S. 731, 89 S.Ct. 1420, 22 L.Ed.2d 684 (1968), instead of that enunciated in Douglas, supra, where under guise of cross-examination, and despite the refusal of a witness to answer, the prosecution read, in the presence of the jury, the witness’s confession that implicated the defendant and then proceeded to authenticate the confession, although it was never introduced in evidence, by the testimony of three law enforcement officers. In Frazier v. Cupp, it was held that no deprivation of the right of confrontation results when a prosecutor sets forth in his opening statement a summary of the testimony he expects, in good faith, from a witness who later declines to testify, when the summary is not emphasized in any particular way, takes only a few minutes to recite, and is sandwiched between a summary of other evidence the prosecution expects to introduce. In this appeal, Williams’ testimony was not isolated in the opening statement but, instead, was an integrated part of a statement that fairly summarized all the evidence, circumstantial and direct, that the prosecution intended to present to prove the crimes charged in the indictment. And, as in Frazier v. Cupp, the district court advised the jury that the opening statement, as the United States attorney also declared, is not evidence and should not be so regarded.

Another factor not to be overlooked in this case is that Williams was called as a government witness and did in fact testify, although his direct testimony was limited by his professions of lack of memory and by his declining to answer significant questions. Also not to be overlooked is the fact that Williams was offered for cross-examination, a right the defense declined to exercise.

We observe, however, that this case alerts us to the potential danger presented by a too-detailed opening statement. If a failure of proof should occur, the jury in its deliberations might consider, as if it had been given, the testimony it was told to expect from a witness even though that witness did not testify. And if a court apprehends a substantial danger of a jury’s doing so, the prosecution risks a mistrial or reversal of a conviction. Here, we are satisfied that the prosecutor did not overstep the line drawn by Frazier, and did everything he could after the opening statement to prevent prejudice in this respect. He obtained an order of immunity to require the witness to testify and he could have insisted on the witness answering his questions. That he and the court did not follow this course may have been because Williams’ lawyer and the prosecutor disclosed that the boy had been threatened by appellant in an effort to seal his lips. A careful review of the entire record convinces us that no error was committed with respect to the opening statement and the testimony of Timothy Williams.

Appellant’s remaining two contentions of error concern the two searches of his apartment. The first search was conducted on January 11, 1972 and yielded a spool of beige thread similar to some thread found in the bank and a button that matched those on the coat received later from Pauline Rogers. The government contends that this search was lawful because appellant consented to it and evidenced his acquiescence by executing a consent-to-search form.

The second search was carried out on January 13 pursuant to a search warrant. On this occasion, the FBI agents seized a rhinestone Christmas tree-shaped ornament that matched parts of earrings found in the bank, and black fibers that matched fibers found on the black and green coat and could haye come from the wig.

Appellant contends that the district court erred in finding that his consent to the first search was voluntary. He claims the evidence showed that he was intimidated by the eight officers who pointed a shot gun at him and falsely told him they could obtain a warrant, although their request for one had just been denied by a magistrate. He contends that the second search was unlawful because the affidavit upon which the search warrant was based contained information obtained in the first search and contained hearsay evidence not from proven reliable sources.

We regard as substantial the question whether consent can be voluntary when it is procured from a suspect confronted with a firearm and deceived by the false assertion that a search warrant can be obtained. “[T]he Fourth and Fourteenth Amendments require that a consent not be coerced, by explicit or implicit means, by implied threat or covert force. For, no matter how subtly the coercion were applied, the resulting consent not be coerced, by explicit or im-for the unjustified police intrusion against which the Fourth Amendment is directed.” Schneckloth v.. Bustamonte, 412 U.S. 218, 93 S.Ct. 2041, 36 L.Ed.2d 854 (1973).

Nevertheless, we find it unnecessary to decide whether these searches were valid because we determine that the evidence obtained from them, considered in the light of the other overwhelming proof of guilt, did not affect the verdict. Accordingly, any error resulting from the admission of this evidence is harmless beyond a reasonable doubt. Brown v. United States, 411 U.S. 223, 93 S.Ct. 1565, 36 L.Ed.2d 208 (1973), Chapman v. California, 386 U.S. 18, 87 S.Ct. 824, 17 L.Ed.2d 705 (1967).

Affirmed.

      . 18 U.S.C. § 2113(a).

      . 18 U.S.C § 924 (c)(1)

      . 18 U.S.C. 2113(e).

      . 18 U.S.C. § 2514 provides that upon entry of an immunity order a witness shall not be excused from testifying on the ground that the evidence required of him may tend to incriminate him. It also provides that the witness shall not be exempt from prosecution for perjury or contempt committed while giving testimony under compulsion.


author: PER CURIAM.

text:
    Robert L. CARDILLO, Plaintiff-Appellant, v. John ZYLA, etc., et al., Defendants-Appellees.
    No. 73-1238.
    United States Court of Appeals, First Circuit.
    Heard Sept. 5, 1973.
    Decided Oct. 29, 1973.

      Robert L. Cardillo, on brief, pro se.
    William J. Deachman, U. S. Atty., on brief, for Calvin Smith, defendant-appel-lee.
    Theodore Wadleigh and Wadleigh, Starr, Peters, Dunn & Kohls, Manchester, N. H., on brief, for The Merchant’s National Bank of Manchester, defendant-appellee.
    David A. Brock, and Perkins, Douglas & Brock, Concord, N. H., on brief, for John Zyla, etc., defendant-appellee.
    Before McENTEE and CAMPBELL, Circuit Judges, and KILKENNY, Senior Circuit Judge .

       Of the Ninth Circuit sitting by designation.

   PER CURIAM.

In a diversity action Cardillo seeks damages against various individuals who, he alleges, gave or induced others to give perjured testimony by reason of which Cardillo was convicted and sentenced. The district court dismissed the complaint for failure to state a claim upon which relief could be granted, F. R.Civ.P. 12(b)(6), characterizing its allegations as “a mere rehash of the facts elicited in a criminal case against the complainant.”

Cardillo was sentenced early in 1972 for violation of 18 U.S.C. § 2314 and conspiracy, in violation of 18 U.S.C. § 371. He had been found guilty, at a jury-waived trial, of collaborating in the purchase of a large quantity of watches in New York by utilizing worthless checks, and immediately thereafter selling the watches for $5500 to John Zyla in New Hampshire. The conviction was affirmed by this court (1972, unpublished) and certiorari was denied, 409 U.S. 1078, 93 S.Ct. 697, 34 L.Ed.2d 667 (1972).

Cardillo claims that the watches were sold by Cardillo’s associate, Jacobsen, to Zyla for cash and a check for $5500, the latter being made payable to Cardillo, without his knowledge, as a cover, and that all witnesses who asserted the contrary had perjured themselves. A scheme whereby Zyla and Jacobsen, unknown to Cardillo, converted the check into cash by forging Cardillo’s endorsement with the connivance of “John Doe”, an employee of the Merchant’s National Bank of Manchester, New Hampshire, is also alleged (“John Doe” and the Bank are also named defendants in the present civil action.) Finally, Cardillo alleges that Smith, a postal inspector also a defendant in the present action, engaged in a plot to suppress the truth by pressuring one Richard Lane, a private investigator hired by Cardillo, not to report accurately a conversation between Cardillo, Zyla, Jacobsen, and one Pervil at which Zyla allegedly admitted that he had lied and given to postal inspectors information falsely implicating Cardillo. Pervil, though not a defendant here, is alleged to have abetted Smith’s efforts to pressure Lane.

We have examined the record of the antecedent criminal case to determine the issues decided by that judgment. See Emich Motors Corp. v. General Motors Corp., 340 U.S. 558, 572, 71 S.Ct. 408, 95 L.Ed. 534 (1951). We hold that Cardillo is collaterally estopped from relitigating the issues he seeks to raise. Collateral estoppel operates, of course, only as to matters actually litigated and decided at the prior trial. See Palma v. Powers, 295 F.Supp. 924, 934 (N.D.Ill.1969), citing Cromwell v. County of Sac, 94 U.S. 351, 353, 24 L. Ed. 195 (1876). But Cardillo’s present civil claims are based on issues whose earlier determination was essential to the criminal judgment, i. e. his knowledge of and personal participation in the watch scheme. See 1B J. Moore, Federal Practice ¶ 0.441 [2] (1965). John Zyla and the postal inspector Smith testified extensively at the criminal trial. Zyla’s sons and Jacobsen were called by Cardillo as defense witnesses.

John Zyla testified that he dealt with Cardillo, not Jacobsen, and that he gave Cardillo the $5500 check. Resolution of Zyla’s credibility on these matters was essential to the court’s decision in the criminal case. The court specifically found, contrary to what Cardillo maintains, that “On December 6, 1968 Cardillo sold approximately 2,000 watches for $5500 to Zyla in Manchester.” Jacobsen, on direct examination, substantially supported the description of events Cardillo urges in this action. Jacobsen asserted that Cardillo was not his partner, did not purchase any watches, and did not sell them or aid their sale to Zyla. He testified that he was present at the meeting with Cardillo, Zyla and Pervil when Zyla admitted that he had made up his story to appease federal officials. But the trial court found that Jacobsen’s story broke down under cross-examination and was “incredible and unbelievable.”

Cardillo’s civil damages claims are therefore inseparable from the issues at the heart of the criminal prosecution: Zyla’s and Jacobsen’s credibility, the good faith of Zyla’s sons and of Inspector Smith. To litigate them would inevitably be to relitigate to greater or lesser degree the nine-day criminal trial held in 1971. This Cardillo may not do while the criminal judgment remains un-reversed or unvacated by the proper tribunal. Edwards v. Vasel, 469 F.2d 338 (8th Cir. 1972).

Cardillo’s civil claim is barred by collateral estoppel even though the prior adjudication was in a criminal proceeding. Emich Motors Corp. v. General Motors Corp., supra, 340 U.S. at 568-569, 71 S.Ct. 408, and even though it is against individuals who were not “parties” at the criminal trial. Mutuality of estoppel, once a requirement before there could be a preclusion of an issue by judgment, is no longer normally required. Blonder-Tongue Laboratories, Inc. v. University of Illinois Foundation, 402 U.S. 313, 91 S.Ct. 1434, 28 L.Ed.2d 788 (1971); P. I. Enterprises, Inc. v. Cataldo, 457 F.2d 1012, 1015 (1st Cir. 1972). What is required is that the party against whom the plea of estoppel is asserted (Cardillo) have been a party or in privity with a party to the prior adjudication. Blonder-Tongue, supra, 402 U.S. 323-24, 91 S.Ct. 1434 citing Justice Traynor’s formulation in Bernhard v. Bank of America Nat’l Trust & Savings Ass’n, 19 Cal.2d 807, 813, 122 P.2d 892, 895 (1942). Having litigated the issue once, Cardillo may not litigate it again unless he can bring himself within the rules governing a reopening of the original criminal proceeding or collateral attack thereon.

Two of the present named defendants, “John Doe” and the Bank, took no part in the criminal trial. No sufficient claim against either, however, is stated. Assuming, as he alleges, that Cardillo had nothing to do with the sale of the watches and the receipt of the check, its negotiation with or without the connivance of “John Doe” would give Cardillo no right of action against the Bank.

Affirmed.

      . Technically, dismissal of a complaint on grounds of collateral estoppel should be by summary judgment, estoppel like res judicata being an affirmative defense. See 1B J. Moore, Federal Practice ¶ 0.408 [1] (1965). There was no prejudice to appellant, however, the only extrinsic matter being the district court’s records of the earlier criminal trial. The district judge who dismissed the present action also heard and decided the criminal case.

      . The matters alleged in the complaint would not appear to support a motion for new trial on grounds of newly discovered evidence. Cardillo asserts ‘that Zyla admitted upon a date well prior to the criminal trial to fabricating his story. Discovery by Car-dillo of Lane’s alleged corruption by Smith could have occurred no later than at the time of the trial.


text:
    UNITED STATES of America, Appellee, v. Clifford JONES, Appellant.
    No. 73-1174.
    United States Court of Appeals, Eighth Circuit.
    Submitted Oct. 17, 1973.
    Decided Oct. 29, 1973.

      Clayton H. Shrout, Omaha, Neb., for appellant.
    William K. Schaphorst, Omaha, Neb., for appellee.
    Before HEANEY, ROSS and STEPHENSON, Circuit Judges.
   PER CURIAM.

Clifford Jones was tried and convicted, by a jury, of violating the provisions of 21 U.S.C. § 841(a)(1) — intentional and knowing distribution of heroin. From that conviction Jones appeals. We affirm.

On appeal Jones asserts three assignments of error: (1) he was denied a fair and impartial jury; (2) the district court erred in admitting exhibits 1, 2 and 3, exhibits relating to the narcotics involved in the crime; and (3) the district court erred when it gave instructions 8 and 11. We shall consider each ground separately.

I. The Jury.

Jones claims that he was denied a fair trial because nine of the twelve members of the jury had served as jurors in other narcotics cases involving the same government witnesses and one had served as an alternate. None of the members of the jury which heard this case were challenged for cause by Jones. Counsel for the defendant was aware of the past experiences of the panel members, and voir dire was conducted with respect to determining whether the past experiences of these prospective jurors would bias them. No bias was found. We have heretofore rejected the per se theory of implied bias advanced by Jones. United States v. Williams, 484 F.2d 176, 177-178 (8th Cir. 1973); Johnson v. United States, 484 F.2d 309, 310 (8th Cir. 1973). We find no‘actual bias, and this case is therefore governed by the rule established in United States v. Williams, supra, and Johnson v. United States, supra.

II. Chain of Custody.

The lock seal envelope, Exhibit 1, containing narcotics, Exhibit 3, was received by a government “evidence technician” at the laboratory of the Bureau of Narcotics and Dangerous Drugs on November 22, 1972. The technician was not called as a witness. On December 13, 1972, Van Sickle, a government chemist took these two exhibits from the evidence vault and conducted chemical tests to determine the nature of the substance. He then placed these exhibits in another lock seal envelope, Exhibit 2, and placed them in a vault. Van Sickle was called to testify at trial.

Objection is made to the introduction of this' evidence because it is asserted that the “chain of custody” was not properly established because of the failure of the evidence technician to testify. This failure is said to render the admission of the evidence objectionable for lack of a proper foundation. We disagree.

As we have recently said:

The criteria governing admission of exhibits into evidence is that there must be a showing that the physical exhibit being offered is in substantially the same condition as when the crime was committed. That determination is to be made by the trial judge, not the jury, and may not be overturned except for a clear abuse of discretion. Factors to be considered in making the determination of admissibility include the nature of the article, the circumstances surrounding its preservation and custody, and the likelihood of others tampering with it. If upon the consideration of such factors, the trial judge is satisfied that in reasonable probability the article has not been changed in any important respect, he may permit its introduction in evidence. United States v. Brown, 482 F.2d 1226, 1228 (8th Cir., 1973).

In sum, “[w]hile the government might have provided further information as to * * * the receiving and storing procedures at the laboratory in Chicago, we do not find these omissions significant.” United States v. Jackson, 482 F.2d 1264, 1267. (8th Cir. 1973). In this case there was no evidence introduced to indicate that the exhibits had been tampered with. Both the chemist who examined the material and the agent who obtained the material testified. The agent testified that he obtained the material, transported it to Kansas City, Missouri, placed it in a lock seal envelope, mailed it, by registered mail, return receipt requested, to the laboratory. He testified that the material offered as evidence was in the same condition as when he received it. The chemist testified that the material was received at the laboratory, and was placed in the evidence vault. Thereafter it was examined and again placed in the evidence vault. We can find no error in the admission of this evidence.

III. The Instructions.

Objection is made to instruction 8, which contains the following language:

[T]he proof of the circumstances surrounding the transaction can supply an adequate basis for finding that the defendant acted knowingly and intentionally. Thus, you may consider the evidence which you recall and believe about the defendant’s actual knowledge and intent and, in general, the manner in which the transactions were conducted.

Jones claims this instruction was erroneous because the only evidence pertaining to the sale was direct, and not circumstantial, and, therefore, the instruction was not applicable to this case. Jones claims that the jury might have been misled into believing that there was some other evidence presented by the government, when in fact there was not.

We note that “knowledge and intent, because of their nature, must largely be proved by circumstantial evidence.” Jackson v. United States, 330 F.2d 679, 681 (8th Cir.), cert, denied, 379 U.S. 855, 85 S.Ct. 105, 13 L.Ed.2d 58 (1964). See also United States v. Lawson, 483 F.2d 535, 536-538 (8th Cir. 1973). In this case, the circumstances of the transaction recounted by the purchaser, such as the price paid for the goods, are necessary to establish that Jones knowingly and intentionally distributed an illicit substance. Indeed at trial there was some ambiguity relative to the purchaser’s request, i. e., he wanted some “stuff.” We think, therefore, that the trial judge could properly instruct the jury to consider the circumstances of the transaction, such as the price paid for the goods. While the purchaser could recount what Jones did, “ ‘there can be no eye witness account of the state of mind with which the acts were done * * *.’ ” United States v. Lawson, supra. 483 F.2d at 536

Objection is also made to instruction 11:

[T]he government is not required to prove any essential element of the offense as defined in these instructions by any particular number of witnesses. The testimony of a single witness may be sufficient to convince you beyond a reasonable doubt of the existence of an essential element of the offense charged, if you' believe beyond a reasonable doubt that the witness is telling the truth.

Jones claims that the instruction may have been confusing because there was only one witness who testified to the actual sale. We do not understand how the jury was confused by this instruction, and it appears to be a correct statement of the law. See, e. g., VII J. Wigmore, Wigmore on Evidence § 2034 at 259 (3d ed. 1940); 2 E. Devitt & C. Blackmar, Federal Jury Practice and Instructions §§ 71.16 and 71.17 at 140 (1970).

For the reasons hereinbefore expressed the judgment of conviction is affirmed.