Why non-disclosure agreements can be an important tool for your business
News about sexual harassment allegations against movie producer Harvey Weinstein has put a spotlight on non-disclosure agreements. Victim advocates have criticized such agreements in the context of the Weinstein scandal – arguing that women who signed them effectively were silenced, according to a Los Angeles Times article.
But the public should understand that these binding contracts are not used exclusively by the powerful and wealthy to hide their dirty laundry. NDAs, or confidentiality agreements, serve a vital purpose for a business or corporation. They are used in a wide range of businesses, from the tech industry to sports. The recent Floyd Mayweather-Conor McGregor boxing match involved an NDA signed by both fighters. They agreed not to discuss any financial details regarding payouts.
If you run a business, you may need your employees or partners to sign a non-disclosure agreement to protect all sorts of information, from financial data to unpublished patent applications and business strategies. Those are just a few reasons you would want NDA protection.
Our corporate law attorneys have years of experience drafting and reviewing NDAs for clients. Our goal is to help our clients maintain a competitive advantage – and creating an NDA will help protect proprietary information. No entrepreneur wants to see their intellectual property or trade secrets falling into the wrong hands.
What is a non-disclosure agreement?
An NDA represents a legal contract between at least two parties. Simply put, the parties agree not to disclose information covered by the contract. Three types of NDAs are used. Most contracts are “unilateral NDAs,” or one-way agreements. In this case, one party agrees not to disclose certain information.
A second type of agreement is known as a “bilateral NDA,” which is commonly used in a joint venture or mergers and acquisitions. You may want to consider creating a bilateral NDA if you and another business want to agree to keep information confidential. These are also known as mutual or two-way NDAs.
A “multilateral NDA” involves three or more parties. In such cases, at least one of the parties may need to disclose confidential information to the others who are named in the NDA.
In any type of NDA, the parties must decide on a defined period of time to keep information confidential. Parties also must decide what type of information is confidential and what can be discussed with parties outside of the contract.
A party that breaks the terms of the legally binding contract can be sued for damages.
If you need an experienced lawyer to help create a non-disclosure agreement or you believe someone breached a contract, contact Brewer & Pritchard P.C. for a consultation. We are the firm in Houston that so many businesses have turned to for help with a range for corporate law matters. Call 800-455-8710 today.