The New York non-disclosure agreement (NDA), or confidential disclosure agreement, is a legal document signed between two or more parties that guarantees that the confidential information or trade secrets exchanged between them won’t be shared with the public without previous authorization.
What is a Trade Secret in New York?
In New York, a trade secret is proprietary information that is crucial for the business’s operation and success, is not publicly known, and is kept confidential as a competitive advantage of that business on the market.
Types of Non-Disclosure Agreements
The main types of non-disclosure agreement forms are unilateral and mutual NDAs. The main differentiating factor between these two types lies in who takes on the responsibility of keeping the shared information confidential.
With a unilateral NDA, the party signing the document accepts not to share the information of the party issuing the NDA, while a mutual NDA forms such an obligation for all the parties involved.
Legal Requirements for New York Non-Disclosure Agreement
New York legislation has not yet established an act that regulates the misappropriation of confidential information. Therefore, that matter is still regulated by the common law. The New York courts have adopted the definition of trade secret from Section 757 of the Restatement of Torts.
Here, you can see the status of the proposed trade secrets act before the state senate.
What Can a Non-Disclosure Agreement Be Used For in New York?
The New York non-disclosure agreement template can be used in different situations based on various factors, such as the type of information the parties want to protect, the level of information confidentiality, the type of entity the party wants to share the information with, and more.
Here, you can find the most common reasons parties choose to create the NDA:
NDA Uses and Scopes
Protection of business and trade secrets: Parties use the NDA to protect business and trade secrets shared during the interaction with their business partners, vendors, suppliers, and other third parties.
Protection of information during employment: The NDA is often signed along with the employment agreement. Its goal is to protect the sensitive information the employee gets access to during their employment.
Protection of intellectual property: Parties can use the NDA to protect their creative work, software, inventions, or other types of intellectual property other parties have access to during their cooperation with the party issuing the NDA.
Protection of information after litigation: This type can be used by the parties that wish to protect the details of their dispute settlement agreement.
New York Non-Disclosure Agreement FAQ
Yes, the NDA is a legally binding document in New York. However, all parties taking on the obligation from the NDA must have legal capacity when signing the document.
The New York NDA doesn’t need to be signed in front of a witness to be valid. However, the parties might consider including witness signatures to further confirm the authenticity of the document.
You can always decline to sign the NDA in New York. However, this action might have a potential negative impact on the relationship between you and the party issuing the NDA.