Avoid “One Size Fits All” Non-Disclosure Agreements

Companies who have “one size fits all” Non-Disclosure Agreements (OSFA NDAs) could be exposing their business to unnecessary risk, and as such it is recommended that employers have different Non-Disclosure Agreements in place to match different situations. Without specific wording in place, information that is proprietary in nature, such as Trade Secrets, can lose its confidentiality obligation with the expiration of the OSFA NDA.

As Anne Friedman from Technology’s Legal Edge puts it:

“What usually happens with an OSFA NDA is that, as this document looks to fit most cases of exchange of information, it is usually set to expire after certain amount of time. Any secret disclosed under a non-perpetual NDA, technically, stops being a secret the day of the expiration of the contract. Once the expiration happens, we are in ‘un-ringing the proverbial bell’ territory: you can try but it is unlikely that you will succeed in claiming that the secret is protected. Note that an NDA expiring is not the issue per se, but the lack of language making the confidentiality obligations for trade secrets survive, even if the contract terminates.”

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