By Joseph N. Hosteny of Niro, Scavone, Haller & Niro
You’ve decided to start a new business based on a great idea you’ve carefully brainstormed. Your research shows that no one else seems to have had the same idea, or developed anything exactly like it. After careful consideration, you’ve decided it can be a new business. For months, or longer, you’ve spent every available hour developing and fine-tuning the details. You now have drawings, specifications, new software, analyses of potential customers and sales volumes, and ways to advertise and market your product or service. Because of your hard work, you now have a wealth of information that others do not have. You have trade secrets.
But in order to pursue your new business, you’ve decided that you will have to disclose some of your information to a third party. Perhaps it is a manufacturer you need to enlist as a licensee, or perhaps it is an advertiser. In any case, your business’s success depends upon someone else’s cooperation. You need to provide that third party with your valuable information to see if, for example, the manufacturer or advertiser is interested in working with you, and at what cost.
How will you protect your valuable information? With a non-disclosure agreement, often referred to as an NDA. It is a quandary: You will have to disclose your valuable information, but you will also have to protect its confidentiality. You’ve decided that anoth...