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During Scherer's ownership of Old Lorvic, Richard Nemanick
submitted monthly and annual reports on the top 10 suppliers and
customers. It is petitioner which concedes that the contractual
requirement that all documentation retained by Scherer was to be
returned was not, in fact, satisfied. In that regard, we observe
that Leck, at trial, considered any written information that
Scherer retained after the sale, to be "a minor detail." He
considered it the responsibility of his partner, Richard
Nemanick. Similarly, Richard Nemanick did not consider the
information to be important. Furthermore, Richard Nemanick
considered the covenant not to compete as "window dressing". We
infer, therefore, that the parties were not overly concerned with
the possibility that Scherer would compete with petitioner.
The parties were sophisticated and engaged in customary and
conventional negotiations regarding the purchase of Old Lorvic's
assets, culminating in the appurtenant agreements. In that
regard, the record does not indicate that the parties possessed
adverse financial interests in regard to the allocation of $3
million to the agreements. Furthermore, the agreements
incorporated clauses which provided that petitioner could enforce
the covenant and the appurtenant secrecy agreement in the event
that Scherer did not abide by these terms. However, we observe
that the subsequent Ernst & Young report did not make an
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