Intellectual Property – Protecting Your Secrets with Non-Disclosure Agreements

Terence Church, Attorney at Law

Terence N. Church & Associates

www.TChurchLaw.com

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Protecting Your Trade Secrets with Non-Disclosure Agreements

A non-disclosure agreement (commonly known as an “NDA”) is a simple agreement, but it is vital to protecting your valuable trade secrets.

A trade secret is the most common type of protected intellectual property, but it requires some effort and attention.  Under California law, in order to claim something as a trade secret, the owner must show reasonable steps have been taken to maintain its secrecy.  One way to do this is to make sure that any person or company to whom a trade secret is disclosed has signed an NDA.  The NDA provides that the receiver of the trade secret will itself take reasonable steps to protect its secrecy and will not disclose it to any other person or company without the permission of the owner.

If you disclose your trade secret to a customer or prospective business partner, for example, and you have not had them sign an NDA, you could be seen as not having taken the required steps to protect its secrecy.  If that happens, you could lose your trade secrets rights and your right to prevent others from using it for their commercial gain.  You have, in effect, converted that otherwise valuable secret to public information.

Don’t be shy about asking people to sign an NDA. It costs them nothing; you are only asking them to keep your secret.  If they are not willing to agree to that, then you should think carefully about whether you want to disclose your secret to that person.

Your trade secrets are valuable assets.  You can lose them very easily if you don’t protect them.  An NDA is an important step in the protection process.

Terry Church was previously with the law firm of Brown, Church & Gee.