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The Illinois non-disclosure agreement (NDA), or confidential disclosure agreement, is a legal document signed between two or more parties that provides the guarantee that the business and trade secrets shared between them won’t be made available to any third party without the previous authorization of the parties involved.
What is a Trade Secret in Illinois?
A trade secret in Illinois is certain information about the operation of a business entity that is considered to be their competitive advantage in a market and is, for that reason, protected from becoming publicly available.
Types of Non-Disclosure Agreements
The main types of non-disclosure agreement forms are unilateral and mutual NDAs. The factor differentiating these two types is who has the obligation to keep the shared information confidential.
With the unilateral NDA, only one party has such an obligation, while the mutual NDA creates that obligation for all the parties corresponding with each other.
Legal Requirements for Illinois Non-Disclosure Agreement
This section presents the legal framework for the non-disclosure agreement template in Illinois:
Mandatory Requirements
Definitions: 765 ILCS 1065/2
Statute of Limitation: An action for misappropriation must be brought within five years after the misappropriation is discovered. (765 ILCS 1065/7)
What Can a Non-Disclosure Agreement Be Used For in Illinois?
The Illinois non-disclosure agreement template can be used in different situations depending on the type of information the parties want to protect, who is signing the NDA, the level of protection they want to provide, and more.
Here, you can see the most common situations where parties choose to create an NDA:
Non-Disclosure Agreement Uses and Scopes
Protection of business and trade secrets: The parties signing this document take on the obligation to keep confidential all the sensitive information shared between them. The document also defines what information is considered business and trade secrets.
Protection of intellectual property: Used for protecting the software, creative work, inventions, or other types of intellectual property other parties have access to during their collaboration with the party issuing the NDA.
Protection of information during research collaborations: The parties use it to protect the information about a certain research project or the results of a certain research.
Protection of customer information: The parties that must share certain sensitive information about their clients with the parties processing this information must issue the NDA in order not to breach the data protection laws.
Illinois Non-Disclosure Agreement FAQ
Yes, the NDA is a legally binding document in Illinois. All the parties signing it must have legal capacity, so the document can be binding for them.
The Illinois NDA doesn’t need to be signed in front of witnesses to be valid. However, the parties might consider including the witnesses' signatures to provide an additional acknowledgement of the NDA’s authenticity.
You can always decline to sign an NDA in Illinois. However, before you do so, you should also consider the consequences this action might have on your relationship with the party issuing the NDA.