Keeping A Secret: Five Tips For Creating An Effective Non-Disclosure Agreement

To keep your secret is wisdom; but to expect others to keep it is folly.

Oliver Wendell Holmes.

Thus the reason why a strong non-disclosure agreement (NDA) used consistently both internally (e.g. directors, officers and employees) and externally with third parties should be the cornerstone of any trade secret and intellectual property policy.

Even with the best of intentions, leaks of confidential information can occur. Unfortunately, once leaked, the confidential nature of a trade secret is difficult or impossible to restore and can result in real harm and devaluation of an entity's material asset. So a good NDA will: (i) encourage compliance and non-disclosure by setting out clear and reasonable expectations with sufficient specificity that can guide operational practices, and (ii) promote efficient enforcement in the applicable jurisdiction in case of a breach.