AESSEAL INDIA LTD Vs. NAGESWARA RAO

JUDGEMENT

(1.) These two revisions are between the same parties and arise out of an interlocutory order passed in OS No. 73 of 2012 on the file of the learned I Additional District and Sessions Judge, Rangareddy District. For the sake of convenience, the parties are referred to as arrayed in the suit.

(2.) The plaintiffs filed the suit against the defendants for the reliefs of perpetual injunction, to restrain the defendants or persons or agencies claiming through them from manufacturing, selling, advertising or distributing mechanicals or any other product in manner based upon the designs, drawings, trade secrets, confidential information belonging to the plaintiffs, to restrain the defendants from passing off or using the confidential information or soliciting customers of the plaintiffs; and for mandatory injunction to destroy all the drawings, designs, trade secrets and data now being dealt with by the defendants; and for award of damages of Rs. 2,00,00,000/- jointly and severally against the defendants for the loss suffered by the plaintiffs. The plaintiffs are engaged in the business of designing, manufacturing and supplying the mechanical seals. While the 1st plaintiff is a company in United Kingdom, the 2nd plaintiff is a holding company. The 1st plaintiff has entered into an Asset Purchase Agreement on 3.9.2008 with defendants 7 and 8. According to that, defendants 7 and 8 agreed to cause the 9th defendant, a private limited company, to sell, transfer the assets, including know-how, intellectual property, and to transfer certain employees to the 1st plaintiff. The employment agreements were also entered on the same day. Extensive documentation was undertaken.

(3.) It was pleaded that in the year 2009, 1st plaintiff sensed some deviations on the part of defendants 7 and 8 and then internal investigation into accounts and management of the agencies revealed certain illegal acts and financial irregularities on the part of defendants 7 and 8. It was also stated that several trade secrets and intellectual property rights, confidential information, designs and drawings of the plaintiffs were wrongfully used by the other defendants with the active collusion of defendants 7 and 8. It was further pleaded that the 9th defendant through its Directors, defendants 10 and 11, wives of defendants 7 and 8 respectively, filed Arbitration OP No. 2599 of 2010 under Section 9 of the Arbitration and Conciliation Act, 1996 (for short 'the Act') in the Court of III Additional Chief Judge, City Civil Court, Hyderabad for certain measures, such as injunction restraining the 1st plaintiff from removing or shifting or transferring or alienating the acquired assets from its branch and that orders passed therein on 7.6.2011 were set aside by this Court in CMA No. 615 of 2011. With these and other related pleadings, the plaintiffs filed the suit claiming the reliefs of perpetual injunction and mandatory injunctions.