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Terms length in NDA and why to use it.

6 Posts
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Posts: 75
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In NDA we decide length of time for which we share the information for how much time is this information is shared is based on the project deadline but isn't it possible for the contractor to modify and use this information and if they do how could it be prevented because this is not companies real information but just a bit modified way it was used.

Posted : 03/12/2017 2:13 pm
Posts: 47
Eminent Member

In many CDAs or NDAs it will be stated that the information belongs to the disclosing party, therefore any version or permutation of the information is still covered by the agreement. I believe in this situation specifically, the disclosing party can pursue legal action against the receiving party, and would likely have to prove that the information is in fact the same information or based on the information disclosed. In the event of any controversy or claim arising out of or relating to this agreement, the parties will either handle the matter by mediation or government arbitration.

Posted : 03/12/2017 3:09 pm
Posts: 40
Eminent Member

I think this may be related to patent law in term of the boundaries that the contractor can push. If they have access to confidential information and sign an NDA, but then go on to do something ever so slightly different, it would be very risky for the contractor as the company would want to punish them by whatever legal means they can manage. It would probably not be smart for a consultant to do something like this as the contract should have such a activity clearly outlined and prohibited. Even if the company couldn't punish the consultant, word may get around and the consultant may be known in the industry as untrustworthy and not be able to get work anymore.

Posted : 04/12/2022 7:31 pm
Posts: 46
Trusted Member

The primary purpose of the NDA is yes, to ensure that trade secrets are not directly divulged to the public. However, as a secondary feature of the NDA; it serves as a paper trail for any subsequent legal investigation into any misuse of shared information. The NDA is just an agreement, it is binding to the extent of its terms; and contracts are often interpreted in whichever way benefits the person interpreting it. At the end of the day, this is one of the risks of doing business. One must find other ways to protect IP.

Posted : 04/12/2022 9:44 pm
Posts: 79
Trusted Member

As mentioned in the above posts, a NDA cannot really prevent anyone from disclosing information about the business or other party. It is more so used as evidence or proof that the receiving party signed a legally binding agreement to keep certain information private. Then if a rival company comes out with a similar product and can be traced back to you, then the NDA can be used as evidence to hold you legally liable. Further, if you are convicted of breaking a NDA then other companies in the field may be reluctant to hire you. 

Posted : 04/12/2022 10:32 pm
Posts: 38
Eminent Member

As seen throughout the posts, the NDA is an agreement that the signee would not divulge any information from the project/use it outside of the defined scope of it being used. As @zbw2 it would be mentioned in the NDA that any variation made to the data or information provided to the user could be pursued as the NDA being broken and legal action can be taken. The person violating the NDA would need to be extremely careful as to how they use the classified information without getting caught, so most likely they would not be able to get away with anything on a large scale without alerting the company. Ways that companies can mitigate this kind of behavior is by making sure that all work is done on site and any technology that is being used to do the work is secure on remote servers. In this scenario it would be extremely beneficial for the company to finance a well equipped IT team that is able to ensure all the data is safe from being leaked and secure. By only allowing work to be done on site, this would mitigate any risk of work being taken out as the IT department would be able to track any actions that an employee may take to do so. 

Posted : 04/12/2022 11:43 pm