Set Up Your Business - in Minutes!
We have a DIY option you can use to save time and stress.We help you:
- Determine the best business structure
- File the right paperwork
- Stay compliant with the law
Prefer to work with a lawyer?Find one right now.
By J.P. Finet, J.D. | Legally reviewed by Tim Kelly, J.D. | Last reviewed September 23, 2022
This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw’s team of legal writers and attorneys and in accordance with our editorial standards.
The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area.
Non-disclosure agreements (NDAs) are legal contracts businesses, organizations, and individuals use to protect trade secrets, proprietary information, or other business information. Sometimes referred to as "confidentiality agreements," NDAs state that the parties will not make protected information available to outside parties.
We make business formation EASY. Learn about our DIY business formation services here.
NDAs are common in business deals because they create a confidential relationship that lets parties share information without worrying that it will be passed on to competitors. NDAs may also appear in employment agreements to keep employees from disclosing sensitive information to competitors.
NDAs commonly cover such confidential information as new product development, customer lists, future business plans, pricing information, or pending litigation. While NDAs can be detailed and unique, most agreements contain the following information:
In most cases, NDAs are enforceable when the terms of the agreement meet the general requirements of a legally binding contract. As with contracts, most courts will not force a party to comply with an NDA if it finds the agreement unconscionable, related to illegal activities, in violation of public policy, was made under duress, or was the result of a mistake.
Additionally, courts have specifically found NDAs to be unenforceable for the following reasons:
Since NDAs can limit future employment and business opportunities, state and federal laws govern the agreements. These laws are often highly complex, so it is usually good to consult with an attorney before signing an NDA.
If one of the parties breaks an enforceable NDA, they face the threat of legal action from the other parties to the agreement. This is often in the form of a lawsuit that seeks financial damages and related costs. Common claims made against those who violate NDAs include:
Of course, filing a lawsuit is only the first step. To win in court, the non-breaching party will need to prove that the NDA was violated and that it suffered damages due to that violation.
If you have been asked to sign an NDA or have questions about an existing agreement, contact an experienced local attorney to provide you with answers and guidance. The state and federal laws surrounding non-disclosure agreements are complex and often subject to change. Speaking with an attorney specializing in NDA agreements will ensure that you receive the most up-to-date advice and help you assess your options so that your money and assets are protected.
Contact a qualified business attorney to help you navigate the process of starting a business.
We have a DIY option you can use to save time and stress.We help you:
Prefer to work with a lawyer?Find one right now.