## Facts

- Lawrence Matarese, a dockworker with limited education, developed mechanical devices to improve cargo loading and unloading and reduce accidents.
- In August 1938, Matarese told John Furey, the shipping company’s pier agent, that his devices would save money and improve safety.
- Furey visited Matarese’s home, where Matarese demonstrated models of the devices in the presence of multiple witnesses.
- Matarese claimed he disclosed the devices with an expectation of compensation, and that Furey encouraged that expectation; Furey denied making binding commitments and denied authority to contract for the company.
- The company adopted and used the devices at its pier, obtaining operational benefits and cost savings, but Matarese was not paid and was eventually discharged.

## Issues

1. Whether a corporation that uses an employee’s disclosed inventions may be required to pay their reasonable value in quantum meruit when an alleged express contract fails for lack of proof of an agent’s authority.
2. Whether the disclosed contribution was sufficiently concrete and novel (not a mere abstract idea) to support restitutionary recovery despite the absence of patent protection.
3. Whether the trial court properly allowed a mid-trial amendment from an express-contract claim to an unjust-enrichment/quantum-meruit theory and submitted that theory to the jury.
4. Whether the evidence supported the damages award, as reduced by remittitur, as the reasonable value of the benefit conferred.

## Decision

- The Second Circuit affirmed the judgment for Matarese in the reduced amount of $40,000.
- The court held that defendants could be liable in quantum meruit for the reasonable value of their use of Matarese’s inventions even though an express profit-sharing contract was not enforceable due to failure to prove Furey’s authority.
- The court concluded the devices were concrete, specific mechanisms with demonstrated utility and were not an abstract “idea”; lack of a patent did not bar recovery.
- The court upheld the trial court’s decision to permit amendment to conform to proof and to try the case on unjust enrichment, finding no unfair surprise because the operative facts were unchanged.
- The court found the reduced award supported by evidence of adoption, use, and resulting savings and safety improvements, and treated remittitur as an appropriate check on overvaluation.

## Legal Principles

- When a defendant knowingly accepts and uses another’s valuable invention disclosed under circumstances showing an expectation of payment, the law may impose an obligation to pay the reasonable value of the benefit received (quantum meruit/unjust enrichment).
- Failure to prove an enforceable express contract, including failure to prove an agent’s contracting authority, does not necessarily preclude restitution for benefits actually accepted and used.
- A restitution claim may be based on unpatented inventions or devices when the contribution is concrete and developed (not merely an abstract concept) and has been adopted in practice.
- Liberal pleading and amendment rules permit shifting from contract to unjust enrichment at trial when the evidence and core transaction have been fully litigated and the opposing party is not unfairly prejudiced.
- In quantum meruit, damages are measured by the reasonable value of the benefit conferred and accepted, not by the terms of an unproven profit-sharing agreement.

## Conclusion

The Second Circuit held that a company that adopted and benefited from an employee’s concretely developed cargo-handling devices disclosed with an expectation of compensation could be required to pay their reasonable value in quantum meruit, and it affirmed a reduced $40,000 judgment after allowing amendment from an express-contract theory to unjust enrichment.


Matarese v. Moore-McCormack Lines, Inc., 158 F.2d 631 (2d Cir. 1946)