American Eutectic Welding Alloys Sales Co. v. Dytron Alloys Corp.,

439 F.2d 428 (2nd Cir. 1971)

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Nature of the Case

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Facts

Eutectic (P) is a New York corporation that manufactures metal welding rods and electrode alloys. P employs over 350 salespeople throughout the country that it calls technical representatives. P paid for D's to receive an intensive three-month training course in New York and paid the salaries and living expenses for Ds as they attended classes, received instruction in metallurgy, welding techniques and attended laboratory sessions. Each D signed a contract with P that would become binding only after a countersignature was obtained at the home office in Flushing, New York. Each D was given confidential customer information and was assigned a territory who agreed to keep the information confidential and not to work for a competitor in the same territory for two years after leaving P. Two of the Ds left P's employ after 5 and 13 years and now work for a competitor, Dytron (D1). P sued Ds and D1 in New York seeking equitable relief, and damages. Ds and D1 opposed jurisdiction in New York, and the district court granted the motion to quash service of process and to dismiss. P appealed.