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04/28/95 ELECTRONIC DESIGN & MANUFACTURING INC. v.

April 28, 1995

ELECTRONIC DESIGN & MANUFACTURING INC., AN ILLINOIS CORPORATION, PLAINTIFF,
v.
JOHN G. KONOPKA, G.S.A. SYSTEMS, INC., A DISSOLVED ILLINOIS CORPORATION, AND ABILITY INTERNATIONAL, INC., DEFENDANTS. JOHN G. KONOPKA, COUNTERPLAINTIFF-APPELLEE, V. ELECTRONIC DESIGN & MANUFACTURING INC., AN ILLINOIS CORPORATION, COUNTERDEFENDANT-APPELLANT, AND ANTHONY TROCANO, AND STAR DIE MOLDING, INC., COUNTERDEFENDANTS.



Appeal from the Circuit Court of Cook County. The Honorable Aaron Jaffe, Judge Presiding.

As Corrected May 15, 1995. Released for Publication May 26, 1995.

The Honorable Justice T. O'brien delivered the opinion of the court: Cousins, P.j., and MC Nulty, J., concur.

The opinion of the court was delivered by: O'brien

JUSTICE T. O'BRIEN delivered the opinion of the court:

Plaintiff-Counterdefendant Electronic Design & Manufacturing Inc. (EDM) appeals from an order of the circuit court compelling EDM to turn over certain die molds and other production work to Defendant-Counterplaintiff John G. Konopka (Konopka). The turnover order was in connection with the purported termination of an exclusive licensing agreement for the manufacture and marketing of a patented electronic device called the "Circuit Locator". EDM contends that the circuit court erred in granting a mandatory preliminary injunction which altered the status quo. We agree and reverse the order of the circuit court.

BACKGROUND *fn1

EDM is an Illinois corporation engaged in the design, manufacture and distribution of various electronic devices on behalf of itself and others. Konopka is the inventor of the Circuit Locator, a device used to identify the precise breaker switch supplying electricity to either an AC outlet or an incandescent light fixture without the interruption of power. Ability International, Inc., a co-defendant and a non-party to this appeal, is also a manufacturer of electronic devices and is responsible for introducing EDM and Konopka.

On April 22, 1991, EDM and Konopka entered into a one-page written agreement regarding the manufacture, marketing and sale of the Circuit Locator. The agreement provided in pertinent part:

"1. John Konopka agrees to work exclusively with EDM Inc. as the Manufacturer and Marketer, for a period of five years, providing the product quality and delivery remain satisfactory.

2. EDM agrees to compensate in following (sic) manner:

2.1 To John Konopka, 7% and to Ability International Inc. 2.5% of her (sic) net sales of this product within 10 days of collection of the shipment monthly.

2.3. EDM guarantees to sell a minimum of 250,000 units by the end of 1992. If she (sic) fails, she (sic) will transfer all tooling, and product specification and artwork with customer accounts at no cost to John Konopka."

Thereafter, EDM placed a special purchase order for the molds, that is, the plastic enclosures to be used in housing the Circuit Locator, as well as certain other components or "hard tooling". EDM bore the expense of obtaining the molds and other production work at a cost of approximately $30,000.00 to $40,000.00.

Once production commenced, EDM began to market the Circuit Locator to various sub-distributors such as Radio Shack, Inc. By the end of 1992, EDM had sold approximately 50,000 to 60,000 units. During this period, and for the first half of 1993, Konopka ...


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