The disclosure of a secret must be intentional in order to constitute a violation of this section. The employee must know that he has no authority to make the revelation. Paragraph 1 of section 17 specifies that the divulging of secrets must be either for the purpose of competition or with the intention of causing injury to the proprietor. The second paragraph specifies only the former motive. The obligation to maintain secrecy imposed by the first paragraph ceases with the termination of one's employment. It may, however, be continued beyond this point by agreement, providing the agreement does not impair the freedom of contract. In the absence of such agreement an ex-employee would be free to make use of the information acquired during his employment, even for competitive purposes, against his former patron were it not for the second paragraph which reaches employees, ex-employees, and all other persons who reveal or utilize for their own profit business secrets if secured in a manner contrary to law or good morals.

In addition to the penalties which section 17 prescribes for violation of its provisions, a civil action to recover damages is provided by seetion 19. The following is a case prosecuted under section 17:

While employed as correspondent for a company the defendant entered into contractual relations with a former competing employer to return to his employ on a certain date. Prior to this date he was requested by a representative of the latter to procure copies of bids, etc., and it was shown that he furnished several copies of bids and other information of value to the competitor. Suit was brought under section 17, paragraph 1. The court held that these copies of bids were trade secrets and imposed a fine of 500 marks upon both the employee and the representative of the competing concern to whom he furnished the information.1

Section 18 prescribes the same penalties as the preceding section for one who, for the purpose of competition, profits by the unauthorized use of plans and rules of a technical kind or reveals them to another. These two expressions cover all manner of models and instructions used in the production of goods. The section specifies drawings, models, patterns, dress patterns, and formulas as being of this character. To constitute a violation of this provision the plans or rules must have been secured by being confided to the guilty party in the course of business and must be used by him without authority or intentionally revealed by him to another for competitive purposes. Section 18 does not relate to the acts of employees. This point was decided by the Imperial Court in a case in which an employee of an automobile concern came into possession of its formulas. The court held that the penal provision of section 18 was applicable only

1 Landgericht Cöln, Urt. v. 30. Sept. 1912; Markenschutz und Wettbewerb, Bd XII S. 298.

to such persons as were not employees at the time when the plans or rules of a technical kind were intrusted to them.1

This section supplements the law of June 19, 1901, for the protection of designs. In accordance with section 19, civil action for damages is permissible in case of violation of section 18, in addition to the penalties provided.

A person to whom a manufacturer had intrusted some patterns for use in making embroidery utilized them for his own profit without authority. Action was brought for violation of section 18. The defendant claimed that the patterns were not intrusted to him in the sense required for the applicability of this provision, since by selling the embroidery in job lots the plaintiff had expressly declared to the business world, as it were, that he had given up the designs, and, therefore, there was no obligation on the part of the defendant to maintain secrecy. This plea was rejected, however, the Imperial Court declaring that the question of the protection of the design was wholly independent of the protection of the patterns which formed the bases of the designs, and that section 18 did not require that the patterns, etc., the unauthorized use of which it prohibited, should have the characteristics of a factory or trade secret, as argued by defendant.2

Section 20 makes it a penal offense for a person to undertake to induce another to violate the first paragraph of section 17 or section 18 for the purpose of competition. The penalty prescribed is imprisonment up to nine months and a fine not exceeding 2,000 marks, or either. By "undertake" is meant every attempt, written or spoken, directly or through a third party, to cause another to violate these provisions. In making the attempt the motive of competition either must exist through one's own acts or by assisting another. In a case involving the latter motive, decided by the Imperial Court in 1913, an employee of a glass factory, in order to secure more remunerative labor for himself, induced the manager to take up a new line of manufacture. He intended to gain his end by inducing employees of another glass factory where he had been formerly employed to secretly deliver to him some of the pieces of glassware to be used as models by his factory. Action was brought against him under section 20. The court overruled his plea that his act was not for the purpose of competition as required by this action, but for the purpose of increasing his own earnings, holding that by inducing his factory to take up the new line of manufacture he intended that it should carry on competition with the other factory, and also intended to assist it to carry on such competition. The Imperial Court further held that, according to this provision of the law, it was important only that the intention

1 Reichsgericht, Urt. v. 12. Dezember 1911; cited by Seelow, op. cit., p. 125.

* Reichsgericht, Urt. v. 4. April 1911; cited by Seelow, op. cit., p. 126.

to commit an act of competition should exist. It was not necessary to consider whether it was a final purpose or a means to an end.1

Administrative provisions.-Section 2 provides that agricultural products, services, and interests are included within the scope of the law. Agricultural associations of various kinds are empowered by this provision to participate in civil actions.

Section 13 provides civil remedies for violation of the various provisions preceding it and designates the persons competent to bring suit. These remedies consist of actions to enjoin and to recover damages. Every person engaged in business and every association for the promotion of business interests, if enrolled in the register of unions in accordance with section 21 of the Civil Code, can bring suit to enjoin or can be enjoined. Where the violations of these provisions are made by employees or agents the injunctions may be issued against their employers. For further reference to section 13 see page 625.

Section 21 provides that the right to bring injunction and damage suits under this law expires in six months from the date on which the person injured had knowledge of the injurious act and of the person committing it; and, further, that irrespective of this knowledge suit can not be brought after three years from the date of the commission of the injurious act. The short period allowed by this section is regarded by some writers as a serious weakness of the law.

According to section 22, criminal prosecution may be begun only upon complaint except for the violation of sections 6, 10, and 11, when the public prosecutor has the power and the duty to begin prosecutions. Where the violation of sections 4, 8, and 12 has occurred, not only the individual injured, but also every business man who makes or sells similar goods or any association for promoting trade interests capable of bringing civil suits as specified in the first paragraph of section 13 is competent to bring a complaint for a criminal prosecution. It is also permitted to withdraw such complaint. Acts which may be prosecuted criminally on private complaint may also be prosecuted in private suit by the parties entitled to make such complaint. A public prosecution takes place only when it is in the interest of the public.

Section 23 provides that where a penalty has been imposed under sections 4, 6, 8, and 12 the cost of making public the judgment may be assessed upon the guilty party. A similar provision is made for violation of section 15, and also in cases where injunctions are issued. On the request of a person acquitted the court may order the publication of the acquittal.

1 Urt. v. 4. April 1913; Entscheidungen des Reichsgerichts in Strafsachen, Bd. 47, 8. 128 # Section 21, Civil Code, states that an association whose object is not the carrying on of a business enterprise acquires juristic personality by registration in the register of associations of the competent district court.

Section 24 relates to the jurisdiction of the courts. It provides that action must be brought in the court in whose district the defendant has his place of business, or, in the absence thereof, his domicile. In the absence of both, it must be brought in the court of the place of his sojourn, or, if this is not known, in the court of the district in which the act occurred.

Section 25 provides for temporary orders in certain cases and specifies the courts which may issue such provisional orders.

Section 26 provides that, in addition to the penalties provided by the law, the injured party may demand the payment of compensation not in excess of 10,000 marks. This remedy excludes a civil action to recover damages. Thus the injured party is required to elect which remedy he will pursue.

Section 27 provides that civil actions brought before the State courts (Landesgerichte) should be tried by the commercial chambers of these courts.

Section 28 relates to the rights of foreigners under the law. A person whose principal establishment is not in Germany can invoke the protection of this law only when by an announcement in the Imperial Gazette it is established that German business men enjoy a corresponding protection in the State in which his principal establishment is located. This section has been superseded by section 10bis of the Washington Convention of the International Union for the Protection of Industrial Property, in so far as the signatories of this agreement are concerned. (See p. 698.)

Section 29 provides that the central authority of the Confederated States shall determine what authorities shall be considered as constituting the superior administrative authority within the sense of the law.1

GENERAL PROVISIONS.

Until 1900 there was no general provision of law in Germany under which objectionable methods of competition were actionable. Although, as stated above (see p. 620), provisions of law similar to article 1382 of the Civil Code of France existed in Prussia and other German States for many years prior to 1900, they were not applied to cases of unfair competition.

During the debate on the special law of 1596 against unfair competition the question of enacting a general clause applicable to all acts not covered by the special provisions was much discussed. The plan was opposed by the Government and finally defeated. According to a leading authority, the meaning of the term "unfair competition" was not clearly understood at that time and a feeling of distrust

1Cf. Kahn und Weiss, op. cit., p. 3×6.

* Lobe, Die Bekämpfung des unlauteren Wettbewerbs, Bd. I, S. 128.

be geral av f 164 guns målt nepeace celý povállited opmala queried pratim this simplementing the provist as of the Penal Code and the geen live for the procesin of patent rights and the besttare. The ser (czema Code of 187 octazed ser era volt mal promovida procuring family and frm nanes against mappropmatic. Other unfair practices not spesially covered by toe abone lave mild not be naided by the ovarts until the new Civil Code secame efecte co January 1. 14. Sections 13 and 826 of this ende ooctained provisi as of law which were broad enough to permit wilt to be brožt is many cases that were not covered by the earlier legiiden anina specie evils. The language of these sertions is in part as follows:

Bu. 13. There, entrary to law, wilfully og eigently injures the life. body best freedom, property, or any other right of another is bound to such other for mompensation of the injury arising therefrom.

Bu6, 93. Whoeser, in a manner repamant to good morals, wilfully inflits an injury upon another is bound to such other for compensation of the injury. The application of these sections to cases of unfair competition met with opposition, but was finally affirmed by a decision of the Imperial Court rendered April 11, 1904, which laid down the principle that the gaps which the special law contained were filled by the Civil Code. especially section 826.1

At the time of the passage of the law of 1909 the necessity of adding a general clause was much discussed in view of the applicability of section 826 of the Civil Code to cases of unfair competition. According to Finger, the general clause was finally adopted because section 826 was considered too unwieldy in that it required the proof of intent and provided for an injunction only in the case of already existing injury. The language of this section is as follows:

SEC. 1. Whoever in business affairs, for the purpose of competition, commits nets which are repugnant to good morals may be subject to an action to desist therefrom and to pay damages.

The term "business affairs" (geschäftlicher Verkehr), found in section 1, is very broad, embracing practically every industrial or commercial activity. By a liberal interpretation, artistic, scientific, legal, and medical activities may also be included where conducted for profit.

The expression "repugnant to good morals" (gegen die guten Sitten) is the same as that found in section 826 of the Civil Code.