Non-Disclosure Agreement: Do I need one in California?

A Non-Disclosure Agreement in California is an agreement between two or more people or companies that limit what secrets, if any, you will share with them and what the other person to the agreement can do with those secrets.  I’ll provide a couple examples of instances when a Non-Disclosure Agreement may be warranted:

Example No. 1: You decide to go into business with someone else to develop your new iPhone application and you have certain information that will improve the functionality. Here, you and the other party would probably have a Non-Disclosure Agreement to (a) limit who can know details of the project; and (b) an agreement that the other party cannot disclose the details to anyone else.

Example No. 2: Your employee needs access to proprietary customer information to do his or her job but you don’t want the employee disclosing that proprietary customer information to outside vendors because doing so may expose your company to a lawsuit by your client. In this case, the Non-Disclosure Agreement would let the employee use that proprietary customer information but not give any confidential information to outsiders.

In California, you may need an Non-Disclosure Agreement if you have information or secrets in your business and if you need to share that information with some people but not others.

The Non-Disclosure Agreement may have the following language: (a) some type of consideration supporting it – for example, in exchange for a job and a salary, the employee keeps the secret; (b) a notice that if the other party discloses the secret, that the agreement between you and the other person is over (for example, the employee is dismissed); (c) an enforceable liquidated damages provision – a paragraph that says that if the Non-Disclosure Agreement is breached, the breaching party owes a specific amount; (d) an injunctive relief clause – stating that if the agreement is breached, then the non-breaching party can go into court and request the breach stop immediately; and (e) language that says that if a lawsuit arises out of the Non-Disclosure Agreement then the winning party gets their attorneys’ fees.

A Non-Disclosure Agreement can be complex depending on what you are trying to achieve.

If you find yourself trying to determine if you need a Non-Disclosure Agreement, Integrated General Counsel can help you determine your next steps.  If you are ready for a results-driven plan of action, contact us either by telephone at (925) 399-1529, schedule yourself into our calendar for an appointment at a time convenient for you, or complete the Contact Kristen form and we will get back to you.

Integrated General Counsel