California Non Disclosure Agreement Law

At CKB Vienna LLP, our lawyers can help you verify whether your confidentiality agreement contains all the necessary conditions and provisions and has a scope that is not excessively broad. For more information, contact us online or at 909-980-1040. A confidentiality agreement can protect any trade secrets or unknown information that gives a company a competitive advantage. However, the use of a generic NDA is generally not helpful, as it is likely that a court will find it either too broad, vague and therefore unenforceable. An NDA form often gives the owner of confidential information a false sense of security. In this context, the confidentiality agreement is discussed in this article. In California, trade secrets must fit a very precise definition. A trade secret must be a formula, pattern, device, etc., that is valuable precisely because it is not known to the public. In addition, appropriate efforts must be made to protect its secrecy. Confidentiality agreements cannot simply claim to prohibit the disclosure of trade secret information without ensuring that there is indeed a trade secret. Second, the nature of the information to be disclosed, the manner in which it is disclosed, the intentional use of the disclosed information, the duration of the availability of the confidential information and the safeguards that the receiving party must take, are specific elements that must be properly addressed in a well-developed confidentiality agreement. A critical aspect of any negotiation of an investment in a business or the purchase/sale of a business is an accurate verification of its activities and financial documentation by the buyer. Normally, this verification is carried out before the execution of a final agreement or, even in the case of execution of a final agreement, the applicability of the agreement depends on the buyer`s satisfaction with the seller`s financial and operational documentation.

These are usually customer lists, formulas, operating reports, etc. In short, the seller opens his books and trade secrets for verification by a buyer, before the activity is mandatory in most cases. Such disclosure to a party that may or may not actually purchase the business requires the protection of secrets where the transaction is not concluded and confidentiality agreements may offer such protection. . . .

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