Category: Nondisclosure Agreement
Subject: Business Owners
By: Genny A. Castellanos, De Novo Review
Nondisclosure Agreement
“Confidentiality Agreement”
A nondisclosure agreement is essentially a confidentiality agreement. It is used to protect a business’ trade secrets and proprietary information. Trade secrets are confidential information that has value and that the business would like to maintain private. Examples of a trade secret include but are not limited to customer lists, methodology for generating new business leads, a formula of a product, and etc.
A nondisclosure agreement puts all parties involved on notice that this information has value, should be protected, and that if it is not, the disclosing party will be subject to legal and equitable relief. Legal relief means that the wronged party may seek monetary damages. Equitable relief means that the wronged party may ask the court to stop the violator from using the information or from making any further disclosures.
What legal relief do you have if no NDA? Without a NDA several problems can arise.
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A person receiving your information may not be legally bound to keep it a secret.
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A person may challenge the existence of an oral agreement (especially since relationships not based on a written agreement are more difficult to prove).
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A person may challenge the existence of a confidential relationship with the owner of the information.
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A person may dispute whether the information received is in fact a trade secret.
Having a written agreement can resolve these issues. The agreement will establish that a confidential relationship exists. The agreement will also demonstrate that the parties have already agreed that certain information constitutes a trade secret or proprietary information.
Business owners often use nondisclosure agreements when that are making a disclosure to a vendor, employee, supplier, investor, consultant, independent contractor, licensees, partners, joint ventures, and in many other instances. A simple, well-written NDA can protect your trade secrets and set the right tone for your relationship with the person or company receiving your trade secrets.
For additional cases similar to these, or for additional research needs on the subject, please contact us at: genny@denovoreiew-new.us21.cdn-alpha.com.
Resource to Write Next Article:
Part II: http://www.stoel.com/files/confidentialityagreementguide.pdf