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What to Do if Your Non-Disclosure is Breached

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Learn about how breaches to your non-disclosure agreement may occur and what remedies you may have in such an event.

Read the full blog article here for more detailed information:
https://everynda.com/blog/non-disclosure-breached/

Published in: Law
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What to Do if Your Non-Disclosure is Breached

  1. 1. What to do if your non-disclosure is breached
  2. 2. A non-disclosure agreement (NDA) is a common and effective legal tool for protecting confidential information. But now one of them has breached your non-disclosure agreement. What do you do?
  3. 3. How breaches can occur
  4. 4. A breach of non-disclosure over confidential information by an employee can happen in many ways including conducting activity of the following without authorization: - Talking about your confidential information to another over a beer. - Showing confidential documents, etc to another. - Publishing confidential information in an online article. - Revealing a prototype of your product to others when it is not meant to be launched yet. - Exposing your secrets to a newspaper reporter, who shares this information to the world through mass media (for example, Edward Snowden (1)). - ... (1) Link to https://en.wikipedia.org/wiki/Edward_Snowden
  5. 5. Remedies for breaches
  6. 6. Monetary damages (which can include larger exemplary damages and attorney’s fees under the new Defend Trade Secrets Act 2016 (2) for stolen trade secrets) are usually provided for in this kind of agreement. A more effective remedy may be to obtain an injunction to stop the employee from breaching your confidential information further or from ever being able to use your information. (2) Link to https://www.congress.gov/bill/114th-congress/senate-bill/1890/text
  7. 7. What to do if your non-disclosure is breached
  8. 8. Step 1: Seek advice from an attorney Turn your signed non-disclosure agreements over to your attorney. Your attorney can look over the facts and provide you with guidance on what needs to be done next. The attorney can also discuss damage control options to minimize the exposure of your confidential information and possible losses. For example, you may decide not to take the matter to court directly but to use arbitration instead.
  9. 9. The sooner you start collecting evidence, the easier it will be for you to prove your case and you also lessen the risk of any evidence being accidentally or purposefully erased. What has been stolen? Who is involved in the breach? How the breach was done? Step 2: Collect evidence
  10. 10. Step 3: Determine the significance of the breach If you decide to pursue your remedies in a legal court, you'll eventually have to prove the monetary value of your confidential information. Not only is this necessary to determine the extent of any payable damages but also to establish the significance of the breach. The more evidence you can collect, the easier it will be for you to make your case.
  11. 11. Step 4: Review your procedures While you're doing your investigations, you may discover some gaps or loopholes that need to be improved to increase your security. More effective internal procedures and policies could include: - Clearly marking confidential information as such - Ensuring that confidential information is separately stored from ordinary confidential information in a secure location - Conducting an exit interview for disgruntled employees - Or increasing training for existing employees on how to look after confidential information
  12. 12. Other legal choices in case of breach
  13. 13. Any breach of your non-disclosure agreement is essentially a breach of contract. Besides pursuing remedies for a breach of contract, you may have other legal options open to you including:
  14. 14. - Misappropriation of trade secrets if the confidential information qualifies as a trade secret under common law, the Uniform Trade Secrets Act (UTSA) (3) or the new Defend Trade Secrets Act 2016 (4) - Breach of patent or copyright if you have an existing patent or the confidential information qualifies as a copyright and breach of fiduciary duty (normally applies to directors or executive officers) (3) Link to http://www.uniformlaws.org/shared/docs/trade%20secrets/utsa_final_85.pdf (4) Link to https://www.congress.gov/bill/114th-congress/senate-bill/1890/text
  15. 15. Credits Icon from slide 1created by Saishraddha Malage from the Noun Project.

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