The use of nondisclosure agreements in trade-secret protection

On Behalf of | Dec 14, 2018 | Trade Secrets |

Our law firm regularly helps businesses, corporations and entrepreneurs to protect their trade secrets from exposure to and misappropriation by competitors. We have written in this space before about the importance of trade secrets to commercial success and stressed the importance of proactively erecting legal and physical barriers around trade-secret information.

A key tool in the trade-secret protection toolbox is the nondisclosure agreement. Also called a confidentiality agreement, an NDA is a contract between a business and a party who may have access to the business’s trade secrets such as: 

  • Employees
  • Contractors
  • Service providers
  • Vendors
  • Suppliers 

As a condition of employment or of doing business, the NDA requires the other party to keep secret any internal trade secrets that it comes across during the business relationship. 

Make NDAs specific, descriptive and tailored to the circumstances 

A search on the Internet would quickly find boilerplate NDA forms, but they may not be specific to the jurisdiction or appropriate for the client’s trade secrets and industry. It is smarter for a business owner to discuss trade-secret protection needs with an experienced intellectual property lawyer so that legal counsel can specifically draft each NDA for the unique business relationship contemplated and to provide maximum protection for the business’ types of trade secrets. 

An article in Above the Law discusses the kinds of provisions that must be carefully drafted, instead of relying on a standard form. For example, if the agreement covers both confidential information that falls short of a trade secret as well as trade secrets, a provision providing that confidential information must be kept secret for an appropriate period of time must be carefully drafted so as not to apply to trade secrets, which normally should be kept confidential for as long as the information is not generally known to those outside the company – what can be decades or longer. 

Discuss your trade secret concerns and NDA questions with a seasoned intellectual property attorney.