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    CVD Incorporated vs. A.S. Markham Corporation

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    sreedeals
    CVD Incorporated was facing closure if they lost their lawsuit against A.S. Markham Corporation, who claimed CVD stole trade secrets regarding their chemical vapor deposition (CVD) process. However, if CVD won but Markham appealed, it could prolong the case and associated costs. The lawsuit stemmed from two former Markham employees starting CVD Incorporated to supply zinc selenide after Markham rejected their idea. Under threat of lawsuit, CVD entered a licensing agreement with high royalties that caused losses. When CVD requested renegotiation, Markham sued. CVD argued the CVD process was common knowledge and not proprietary, while Markham claimed CVD stole trade secrets in violation of employment contracts.

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    CVD Incorporated vs. A.S. Markham Corporation

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    sreedeals
    389 views1 page
    CVD Incorporated was facing closure if they lost their lawsuit against A.S. Markham Corporation, who claimed CVD stole trade secrets regarding their chemical vapor deposition (CVD) process. However, if CVD won but Markham appealed, it could prolong the case and associated costs. The lawsuit stemmed from two former Markham employees starting CVD Incorporated to supply zinc selenide after Markham rejected their idea. Under threat of lawsuit, CVD entered a licensing agreement with high royalties that caused losses. When CVD requested renegotiation, Markham sued. CVD argued the CVD process was common knowledge and not proprietary, while Markham claimed CVD stole trade secrets in violation of employment contracts.

    Original Description:

    CVD Markham Case

    Original Title

    CVD Markham Case

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    CVD Incorporated was facing closure if they lost their lawsuit against A.S. Markham Corporation, who claimed CVD stole trade secrets regarding their chemical vapor deposition (CVD) process. However, if CVD won but Markham appealed, it could prolong the case and associated costs. The lawsuit stemmed from two former Markham employees starting CVD Incorporated to supply zinc selenide after Markham rejected their idea. Under threat of lawsuit, CVD entered a licensing agreement with high royalties that caused losses. When CVD requested renegotiation, Markham sued. CVD argued the CVD process was common knowledge and not proprietary, while Markham claimed CVD stole trade secrets in violation of employment contracts.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    389 views1 page

    CVD Incorporated vs. A.S. Markham Corporation

    Uploaded by

    sreedeals
    CVD Incorporated was facing closure if they lost their lawsuit against A.S. Markham Corporation, who claimed CVD stole trade secrets regarding their chemical vapor deposition (CVD) process. However, if CVD won but Markham appealed, it could prolong the case and associated costs. The lawsuit stemmed from two former Markham employees starting CVD Incorporated to supply zinc selenide after Markham rejected their idea. Under threat of lawsuit, CVD entered a licensing agreement with high royalties that caused losses. When CVD requested renegotiation, Markham sued. CVD argued the CVD process was common knowledge and not proprietary, while Markham claimed CVD stole trade secrets in violation of employment contracts.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    CVD Incorporated Vs. A.S.

    Markham Corporation
    The case that Bob Donadio and Joe Connolly were fighting was a double edged sword for them.
    On one hand if they lose the trial, their company CVD Incorporated would have to close its
    operations and on the other hand if they win the case, there is fear that Markham may prolong
    the case with an appeal in higher courts. Prolonging the case would result in higher expenses and
    frustration for the two founders of CVD Incorporated.
    It all started when Donadio, a former employee of Markham Corporation, had an idea to supply
    zinc selenide (ZnSe/cvd) to some optical fabricating clients. At that time Donadio was working
    in the Advanced Materials Department of the company and Connolly was reporting to him.
    When the company rejected the idea of making zinc selenide, they teamed up to setup their own
    company called CVD Incorporated. Faced with the threat of law suits from Markham, CVD
    Incorporated entered into a licensing agreement with Markham. Little did CVD know that the
    royalties would be a big burden on their bottom line leading to losses for the startup company.
    When CVD approached Markham for renegotiation of the licensing terms, Markham declined.
    Both the companies entered into a litigation to solve the issue.
    Markhams claims were following:

    Markham had trade secrets and that CVD stole their secrets and, confidential and
    proprietary information.
    There is a skill required for the CVD process and Donadio and Connolly learned about
    CVD process when they were working for Markham; they both have therefore violated
    their employment contracts. As of 1993, Markham was the only company with the
    capability to produce zinc selenide and zinc sulfide.

    CVDs claims were following:

    The chemical vapor deposition process is a common knowledge that many chemical
    engineers and scientists had; it was also taught in many chemistry courses in schools. So
    Donadio and Connolly claimed that they acquired the knowledge about CVD much
    before they joined the company.
    There was a patent issued to H.J. Gould for certain parts of the CVD process and so it is
    not proprietary to Markham.
    Donadio and Connolly were forced to sign a licensing agreement in which the royalties
    were too high, leading to continuous losses for their company.

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