California Non-Disclosure Agreement (NDA)

The California non-disclosure agreement (NDA) is an instrument that allows employers to protect their trade secrets from misappropriation by employees (misappropriation occurs when an employee wrongfully uses or discloses their employer’s proprietary and confidential information). The NDA contains provisions outlining both the information which must be kept secret and the duration of the document’s enforceability. Employees that breach the agreement while the contract remains effective will be subject to legal repercussions enforced by the employer.

Misappropriation (§ 3426.1(b)) – Employees that breach the agreement may be responsible for damages (§ 3426.3) and attorney’s fees (§ 3426.4).

Trade Secret Definition (§ 3426.1(d)) – “Trade secret” means information, including a formula, pattern, compilation, program, device, method, technique, or process, that:

• (1) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and
• (2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.