Common Uses for Non-Disclosure Agreements

Non-Disclosure Agreements

Many companies need to protect the confidentiality of information when hiring employees, or making business deals with another party. To do this they create non-disclosure agreements. The most common instances when a non-disclosure agreement is appropriate include:

  1. Trade Secret Protection

Trade secrets are only afforded protection if the owner of the secret takes measures to keep it, and if the secret gives the owner an advantage in the marketplace. Having employees sign a non-disclosure agreement is the owner’s way of protecting that trade secret. More often, companies are including these agreements in employment contracts.

2. Confidential Relationships

Another use for non-disclosure agreements is creating a confidential relationship between the party that holds the trade secret and the party to whom the trade secret is disclosed. A confidential relationship could be sub-contracting out projects, or negotiating a new business proposition.

When a non-disclosure is created, hopefully with the help of an experienced attorney, it needs to clearly define the confidential information being protected. The relevant information needs to be covered, while irrelevant information is excluded. If the definition of confidential information is too wide, it may be unenforceable.

Along with defining the confidential information, the agreement should identify the persons to whom the information is being disclosed. Confidentiality agreements under a non-disclosure may be of a fixed or indefinite duration as well.

If a non-disclosure agreement is violated, the company can make a request to a court to stop the person from using the protected information. Companies can also sue the offender for any damages that may have been suffered as a result of the breach in confidentiality.

The attorneys at InnovaCounsel can assist businesses in drafting non-disclosure agreements to include in employment contracts or when dealing with a confidential relationship. We can also enforce the agreement if someone tries to violate it later on.


24 Responses to Common Uses for Non-Disclosure Agreements

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