Stealing in the Dark the Improvements of Others
In 1808, the Wilmington, Delaware, powder manufactory of E. I. du Pont de Nemours & Company was a sophisticated operation by the standards of American explosives manufacturing of the day. On account of its founders’ superior knowledge of the chemistry of gunpowder and its employees’ careful development of techniques for its composition, the firm had established a favorable position in the market even in the six short years of its operation. The employees’ know-how was one of the firm’s most precious assets. When a competing powder maker sought to recruit Du Pont workers to learn from them the company’s techniques, Du Pont found it had no legal remedy for the harm inflicted by the departure of its skilled workers. Skilled employees bound by no contract were free to quit and to take whatever knowledge they learned on the job with them. And even if Du Pont had attempted to bind its employees through agreements not to compete or not to disclose its secrets, the courts would not have enforced them. If both lawyers and businesspeople appreciated the value of knowledge, why did the law provide no remedy?
This chapter begins with an explanation of the nature and reasons for the early American legal commitment to mobility of labor and to the courts’ refusal to regard workplace knowledge, whether unpatented secrets like Du Pont’s or patented inventions by employees, as the virtually inalienable attribute of the individual employee. Against the context of the antebellum legal commitment to free mobility of skilled labor and individual entrepreneurship protected by patent law, the chapter then examines how Du Pont’s business strategy and choices for managing its skilled workers reflected and adapted to the American insistence that workplace knowledge was the attribute of skilled workers, not an asset of the firm that employed them.