NDA - Non Disclosure Agreement
NDA - Non Disclosure Agreement
- WoW LQGaming
We have compiled all the information that we have found about NDAs. As you may know, the upcoming Beta Test for the World of Warcraft will require a NDA to be signed by you, in the case you were selected to beta test the game. So, for your information, below is an explanation about what are these legal contracts and what are they based off, so you can have an idea on how the NDA for the WoW beta will be.
But let's examine these NDAs in detail:
Non-Disclosure Agreements (NDAs) are versatile and necessary tools in the arsenal of anyone, (inventor or corporation) who handles intellectual property. An NDA is a contract whereby the signer agrees not to disclose certain information, except under terms as described in the contract. A non-compete agreement (NCA), inhibiting use of the information in competition with the disclosing party, is often included as a clause within the NDA. An NDA can be obtained at little to no cost, although one needs to be cautious in making sure the agreement will fit the use intended. NDAs should be used as part of a larger strategy and may be used in conjunction with patents and patent applications.
1. Cost - NDAs are perhaps the lowest cost of protection for an invention. Often a simple agreement can be obtained for little to no cost. Although cost is one of the primary benefits of NDAs, this advantage has a tendency to breed over reliance.
2. Breadth - NDAs provide broader protection than patents, which is a reason justifying simultaneous use of NDAs and patent applications. Breadth includes both positive and negative aspects. Broad protection is beneficial at nearly any time. Most creators of NDAs, however, struggle in determining exactly what is and is not covered under the terms of the contract. A common example is where there is no recording of what information was communicated during the discussion. The ambiguity can lead to problems should the matter ever come to litigation. The disclosing party wants the contract interpreted broadly including all information related to the actual disclosure, whereas the disclosee may wish to interpret the coverage much more narrowly. This can be a costly issue to resolve.
3. Integrity of the disclosee - There is an old adage that a contract is only as good as the person signing it. One is safer using an NDA with those people of known high integrity and is of little value with person having low integrity. This integrity problem is compounded with the inventor's inability to monitor the disclosee. Often people will not have an NDA signed by persons having high integrity, but this leads to the next problem.
4. Integrity of the Process - Inventors often get in a hurry and forget to use the NDA. For example, flaws can easily occur when one has the invention witnessed, when speaking to a friend, or when forming a relationship with a marketer or manufacturer. Perhaps this forgetfulness occurs due to the inventor perceiving everyone to be on the same side or perceiving people will respect the interests of the disclosing party. Even if they are and do, the disclosure in the absence of an NDA can constitute a public disclosure and void any future protection. Public disclosure is a legal point that has nothing to do with the integrity of the people hearing about the invention.
5. Integrity of the Document - Each State has laws regulating the validity of NDAs and other such contracts. Some states show little concern for NDAs and regularly find them invalid. Should the contract be flawed, it may provide no protection at all. In some states one invalid clause will invalidate the entire contract. One can guard against this problem by seeking legal counsel on the validity of the contract before reliance is placed on it.
6. Delays necessary filing date of a patent - In the US, a patent must be filed within one year of the first public disclosure or offer for sale. Nearly all other countries require the patent application to be filed before the first public disclosure or offer for sale. A disclosure under the terms of a valid NDA does not constitute a public disclosure, assuming no inadvertent mistakes. The one year clock (US) or the requirement of prior filing does not take hold absent an offer for sale or a mistake in the handling of the NDA.
One, evaluating the benefits and risks of NDAs, should keep squarely in their mind whether ultimate protection may include a patent. NDAs are highly risky for protecting an invention. Problems with a flaw in the signing process, unexpected impact of law, an inadvertent mistake on the part of the discloser or disclosee and lack of clarity in breadth will generally destroy all possible foreign patent rights and start the US one year clock ticking. Discovering the error may not occur quickly, which can lead to permanent loss of US patent rights before the inventor learns s/he needs to act. A more secure form of protection is advised when the information being protected could be protected with a patent.
These tough patent laws should be contrasted with trade secret laws that generally require reasonable care. An inadvertent error under trade secret law is much less likely to be fatal. Unlike patent law, trade secret law generally does not require flawless execution. Trade secret law typically requires reasonable care under the circumstances, which tends to make allowance for inadvertent and non-consequential errors.
Low cost and broad protection make the NDA a valuable tool in appropriate circumstances. An NDA should always be used to protect trade secrets, but has limited value as the risks increase for protecting patentable subject matter. Patentable subject matter is better protected under the more secure patent laws with either a provisional or formal patent application. One should use NDAs where appropriate and in view of these risks and benefits.
EXAMPLE OF A NDA contract:
Well, we hope this information helped you to know in detail what a NDA contract is. =)
The common definition is: A non-disclosure agreement (NDA) is a legal contract between two parties which outlines confidential materials the parties wish to share with one another for certain purposes, but wish to restrict from generalized use.
But let's examine these NDAs in detail:
Non-Disclosure Agreements (NDAs) are versatile and necessary tools in the arsenal of anyone, (inventor or corporation) who handles intellectual property. An NDA is a contract whereby the signer agrees not to disclose certain information, except under terms as described in the contract. A non-compete agreement (NCA), inhibiting use of the information in competition with the disclosing party, is often included as a clause within the NDA. An NDA can be obtained at little to no cost, although one needs to be cautious in making sure the agreement will fit the use intended. NDAs should be used as part of a larger strategy and may be used in conjunction with patents and patent applications.
1. Cost - NDAs are perhaps the lowest cost of protection for an invention. Often a simple agreement can be obtained for little to no cost. Although cost is one of the primary benefits of NDAs, this advantage has a tendency to breed over reliance.
2. Breadth - NDAs provide broader protection than patents, which is a reason justifying simultaneous use of NDAs and patent applications. Breadth includes both positive and negative aspects. Broad protection is beneficial at nearly any time. Most creators of NDAs, however, struggle in determining exactly what is and is not covered under the terms of the contract. A common example is where there is no recording of what information was communicated during the discussion. The ambiguity can lead to problems should the matter ever come to litigation. The disclosing party wants the contract interpreted broadly including all information related to the actual disclosure, whereas the disclosee may wish to interpret the coverage much more narrowly. This can be a costly issue to resolve.
3. Integrity of the disclosee - There is an old adage that a contract is only as good as the person signing it. One is safer using an NDA with those people of known high integrity and is of little value with person having low integrity. This integrity problem is compounded with the inventor's inability to monitor the disclosee. Often people will not have an NDA signed by persons having high integrity, but this leads to the next problem.
4. Integrity of the Process - Inventors often get in a hurry and forget to use the NDA. For example, flaws can easily occur when one has the invention witnessed, when speaking to a friend, or when forming a relationship with a marketer or manufacturer. Perhaps this forgetfulness occurs due to the inventor perceiving everyone to be on the same side or perceiving people will respect the interests of the disclosing party. Even if they are and do, the disclosure in the absence of an NDA can constitute a public disclosure and void any future protection. Public disclosure is a legal point that has nothing to do with the integrity of the people hearing about the invention.
5. Integrity of the Document - Each State has laws regulating the validity of NDAs and other such contracts. Some states show little concern for NDAs and regularly find them invalid. Should the contract be flawed, it may provide no protection at all. In some states one invalid clause will invalidate the entire contract. One can guard against this problem by seeking legal counsel on the validity of the contract before reliance is placed on it.
6. Delays necessary filing date of a patent - In the US, a patent must be filed within one year of the first public disclosure or offer for sale. Nearly all other countries require the patent application to be filed before the first public disclosure or offer for sale. A disclosure under the terms of a valid NDA does not constitute a public disclosure, assuming no inadvertent mistakes. The one year clock (US) or the requirement of prior filing does not take hold absent an offer for sale or a mistake in the handling of the NDA.
One, evaluating the benefits and risks of NDAs, should keep squarely in their mind whether ultimate protection may include a patent. NDAs are highly risky for protecting an invention. Problems with a flaw in the signing process, unexpected impact of law, an inadvertent mistake on the part of the discloser or disclosee and lack of clarity in breadth will generally destroy all possible foreign patent rights and start the US one year clock ticking. Discovering the error may not occur quickly, which can lead to permanent loss of US patent rights before the inventor learns s/he needs to act. A more secure form of protection is advised when the information being protected could be protected with a patent.
These tough patent laws should be contrasted with trade secret laws that generally require reasonable care. An inadvertent error under trade secret law is much less likely to be fatal. Unlike patent law, trade secret law generally does not require flawless execution. Trade secret law typically requires reasonable care under the circumstances, which tends to make allowance for inadvertent and non-consequential errors.
Low cost and broad protection make the NDA a valuable tool in appropriate circumstances. An NDA should always be used to protect trade secrets, but has limited value as the risks increase for protecting patentable subject matter. Patentable subject matter is better protected under the more secure patent laws with either a provisional or formal patent application. One should use NDAs where appropriate and in view of these risks and benefits.
EXAMPLE OF A NDA contract:
NON-DISCLOSURE AGREEMENT
____________________ a corporation according to the laws of the State of ___________, having an address of ________________________________ (hereinafter referred to as "Recipient"), in consideration of receiving information regarding an idea entitled "_____________________________" (hereinafter referred to as the "Idea"), for the purpose of _________________, and _____________________, having an address of _______________________________________ (hereinafter referred to as "Owner"), hereby agree that:
____________________ a corporation according to the laws of the State of ___________, having an address of ________________________________ (hereinafter referred to as "Recipient"), in consideration of receiving information regarding an idea entitled "_____________________________" (hereinafter referred to as the "Idea"), for the purpose of _________________, and _____________________, having an address of _______________________________________ (hereinafter referred to as "Owner"), hereby agree that:
1. Recipient will maintain the information concerning the Idea obtained from Owner in strict confidence.
2. Recipient will not disclose the Idea to anyone other to its employees.
3. Notwithstanding any other provisions hereof, Recipient shall not be liable for use, release or disclosure of any information that:
a) is required by judicial action after all available legal remedies to maintain the information in secret have been exhausted;
b) is known to Recipient prior to the disclosure to Recipient by Owner;
c) is independently developed by Recipient or one of its divisions of groups without any breach of this agreement; or
d) is approved by Owner for use or public release.
4. Nothing herein shall in any way affect the respective rights of either party under the patent, trademark and copyrights laws of any country.
5. This Agreement shall remain in force and effect for one (1) year from the date set forth below.
6. The undersigned has the authority to execute this Agreement to hold confidential on behalf of himself and on behalf of Recipient.
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Well, we hope this information helped you to know in detail what a NDA contract is. =)
