In today’s globalized world, where sharing data and information is as easy as a click or a tap, one of the best defenses for protecting your business’s sensitive data is the non-disclosure agreement (NDA). Put simply, this is a contract that requires a party to refrain from disclosing confidential information, or to only use the information for specified purposes. As your Seattle business lawyer can attest, the non-disclosure agreement is key in managing the dissemination and usage of business information.
While there are plenty of different areas where an NDA can be useful, it’s most generally applied to intellectual property like copyrights, trade secrets, and patents. Why would an NDA be useful? Take patent application as an example. Applying for a patent is time-consuming and expensive, and anyone involved in the innovation to be patented could share sensitive information along the way, even with law of confidence. The NDA is an additional layer of protection to discourage the disclosure of confidential business information to other parties. This could help you avoid fees down the road from hiring an IP litigation attorney in Seattle.
Who to Use NDAs for
Whether the concern is code from a software development project, financial data, or a secret new recipe for your restaurant, it’s crucial to consider the NDA to keep your competitive advantage out of the hands of competitors. If you decide to have an NDA used, you’ll use them in a few key instances:
- Securing funding
- Web/software development
- Using employees
- Working with independent contractors
In effect, your goal is to keep outside people who are close to your business in some way from spreading confidential information. It might be your company’s financials, your company’s expansion plans, or an integral part of your next product, but the common denominator is that you want to keep some things about your business quiet.
How do NDAs Work?
The purpose of an NDA is to get a party to agree not to disclose valuable information in an unauthorized manner, with the threat of legal action if they do. However, they only work if you get others to sign the non-disclosure agreement. It’s a binding contract like any other contract, involving consideration between both parties.
This is not to say that it’s the only solution or the best one, when it comes to keeping your data secure. Don’t neglect old-fashioned strategies like hand-picking people you trust to know about sensitive information, instituting an information security policy, and the like. Your business attorney in Seattle can help you establish best practices for protecting your data and using NDAs to your business’s benefit.