Proprietary information is often the foundation of a business’s success. This could include unique manufacturing processes, a marketing program developed over years of trial and error, trade secrets, a customer list, or any other crucial information. For a business owner, protecting this information is key to ensuring continued success.
There is a way to protect sensitive data from others who might consider sharing it with your competitors. To safeguard your confidential information, consult an Atlanta non-disclosure agreement (NDA) lawyer at Sparks Law. Our skilled attorneys could explain the role of restrictive covenants and draft or review your contracts to ensure they are valid and enforceable.
For a non-disclosure agreement to be enforceable, both parties involved must give up something of value to gain something else. In legal terms, this is known as consideration.
For example, a prospective employee who will have access to trade secrets might sign a non-disclosure agreement in exchange for getting the job. A merger candidate might sign one to take the talks to the next level. Regardless of the specific circumstances, an Atlanta attorney at our firm could ensure that an NDA supplies consideration on both sides.
Non-disclosure agreements should be in writing, as should any later amendments. Written agreements prevent future misunderstandings and provide evidence of what the parties negotiated in good faith. Other than the requirement for consideration, an NDA should include:
For restrictive covenants, including non-disclosure agreements, Georgia employs the Blue Pencil Law. Rather than toss out a contract that is deemed overbroad, the judge may extract or amend certain conditions while leaving the bulk of the agreement intact.
For instance, a provision forbidding a merger and acquisition candidate from forever negotiating with another candidate would probably be amended to a specific time-period. The discloser’s intention to stop the receiver from sharing trade secrets would be left intact, but the receiver would eventually be allowed to seek other business opportunities if the first deal does not close. At Sparks Law, our Atlanta attorneys could draft an NDA with these points in mind.
If there is a breach of a non-disclosure agreement, the civil court process begins with the plaintiff filing an injunction against the defendant. The court will order the defendant to immediately stop disclosing sensitive information, which should be returned or destroyed.
The plaintiff can file a lawsuit that begins with a complaint factually detailing the breach. The defendant must answer the complaint. If they fail to or cannot offer facts substantiating why they divulged confidential information, the plaintiff can ask for summary judgment, in which the judge rules in the plaintiff’s favor.
A settlement can occur at any time during the procedure. This involves the defendant paying the plaintiff an amount to reflect what the business lost because of the breach. If parties do not settle, the last resort is a trial. At this stage, a judge or jury decides if the defendant is guilty or innocent. If guilty, they determine how much the defendant who breached the NDA should pay in damages to the plaintiff.
In many business settings, you will be expected to share confidential information. New employees may be privy to your new marketing campaign or customer list. Merger candidates will ask for extensive information not available to the public. You should restrict anyone receiving this information from disclosing it outside of the realm you intended.
At Sparks Law, an Atlanta non-disclosure agreements lawyer could review the restrictive covenants you currently use or draft new ones that protect your interests under Georgia law. Contact our office today for an initial appointment to discuss your business needs.