The California non-disclosure agreement (NDA), or confidential disclosure agreement, is a legal document that defines the confidential information of the parties signing it and establishes an obligation for the parties not to share this information with third parties.
What is a Trade Secret in California?
A trade secret in California is confidential information regarding the operation or practice of a certain business that is not accessible to the general public or competitors and that presents an advantage to that business in a marketplace.
Types of Non-Disclosure Agreements
Here, you can see the main types of non-disclosure agreement forms based on who takes on the obligation of keeping the shared information confidential:
Two Types of Non-Disclosure Agreements
Unilateral NDA: Here, only one party is under the obligation to keep the shared information confidential. This is mostly used for the NDAs signed between the companies and their employees.
Mutual NDA: This type of NDA creates an obligation for all the parties signing the document to keep the shared information confidential. This is used in situations where all of the parties share certain confidential information with each other.
Legal Requirements for California Non-Disclosure Agreement
Here, you can find the legal requirements regulating the non-disclosure agreement template in California:
What Can a Non-Disclosure Agreement Be Used For in California?
In California, the non-disclosure agreement can be used in various situations depending on what type of information the parties want to protect.
Therefore, here are the most common situations where the NDA can be used:
NDA Uses and Scopes
Protection of business and trade secrets: The parties can sign the NDA that covers the confidential information shared during the business negotiation between the business partners, suppliers, vendors, and other parties interacting with the business entity.
Protection of intellectual property: Used for protecting the inventions, creative work, software, and other types of intellectual property other parties have access to during the interaction with the party issuing the NDA.
Protection of information connected with the litigation: Used in situations when the parties want to keep confidential the details about the litigation settlement agreement.
Protection of information during the employment: Usually signed by the employee together with the employment agreement, covering the confidential information they get access to during their employment.
California Non-Disclosure Agreement FAQ
Yes, the NDA is a legally binding document in California. The document becomes legally binding the moment all of the parties taking on the obligation sign it.
No, the NDA doesn’t have to be signed in front of witnesses in California. However, that doesn’t stop the parties who want to additionally confirm the authenticity of the document from doing so.
You can always decline an NDA in California. However, declining to sign the NDA might affect your relationship with the party issuing the NDA and prevent you from participating in business negotiations or the employment process.