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Confidentiality Agreements and NDAs: What Are They?

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Whenever you embark on a creative entrepreneurial endeavor, the concept of intellectual property rights is immediately introduced. By definition, intellectual property is essentially an idea. You can protect that idea of  yours once you are able to affix it to a tangible medium that allows other people to experience your idea. But that’s not my point. I wrote about IP already here. Let’s move on. 

Once a product is complete, assigning ownership is pretty cut and dry. The person who created the work or who commissioned the work to be created is usually the owner. But while the work is in the process of being created, things can get tricky, particularly if the work is being developed by multiple people at once.

What is an NDA?

A Non-Disclosure Agreement (otherwise known as a Confidentiality Agreement) is a contract that protects your right to be the sole beneficiary of your idea. By signing an NDA, your hired guns agree that they will keep confidential the material, knowledge, or information that you share with them during the creation of your product.

If you are in the process of having your creative idea developed and you’ve hired other people to work with you toward completion, one of the more important issues you need to address is protecting your intellectual property.

Now, I’m not really talking to you if you’re the type of person who makes anyone who sits down to have coffee with you sign an NDA. You just need to relax. I’m talking about sane people, people who are really grinding to bring an idea to life and take it to market. The last thing you need is for some wack knock-off artist to get into the stores before you because your graphic designer couldn’t or wouldn’t shut-up about his new project. 

Having your team members sign a Non-Disclosure Agreement helps to protect your creation from being stolen or published prematurely by someone else.

There is risk inherently involving in working with other people. The primary goal is to make sure the people you recruit to help you don’t turn around and bite the hand that feeds them. 

You want protection against them double crossing you (pulled that term right from my mental catalog of language from 70s police dramas), telling company secrets and revealing what’s in your secret sauce.

What Goes In an NDA?

What goes into an NDA depends on the property you are protecting and the scope of the project. If you really think about it, a pinky swear is a confidentiality agreement and it takes all of 5 seconds to enter one.

I think I might be obligated to say the following: If you’re drawing up a Non-Disclosure Agreement, your best bet is to seek the counsel of an attorney that is experienced in your particular area of Intellectual Property law.

But if you need an agreement on the fly, here are some things to include:

  • Identify the parties to the agreement
  • Outline specifically what information is confidential
  • Disclosure period – the length of time the parties are expected to keep sensitive information confidential
  • Any exclusions about what must be kept confidential; typical exclusions include:
  • Information the signer previously knew
  • Information the signer learned from other materials outside of the project
  • Information and materials that are publicly available
  • Subpoena
  • Any restrictions of data that become a matter of national security
  • Duration of time in which the agreement is in effect
  • Agreement that the employer can exercise injunctive relief if the signer violates the agreement and goes out on his/her own to do the job without you
  • Allotted use of information
  • Use sensitive information for specified purposes
  • To share the information only with those authorized by the employer to know
  • To use appropriate efforts to keep the information secure
  • Types of permissible disclosure (such as court order)
  • Law and jurisdiction governing the parties

Again, so you don’t go off half-cocked, work with an experienced attorney who can help you to draft an airtight NDA that will protect you, your contractors and your idea. A good attorney can guide you through some of the other terrain you will likely need to cover, particularly if you are dealing with intellectual property.

If you need something quick though, you can grab a copy-and-paste form from Nolo here, a fillable form from Rocket Lawyer here, and a quick-fix from LegalZoom here for $14.95. 

Picture from energepic.com from Pexels

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