Is there any risk of not using NDA?
Using a Free Non-Disclosure Agreement is what you do with our form document creator. The confidentiality contract intends to protect sensitive proprietary of the concerned parties to the agreement. Relying on the word of mouth can be a grave mistake that businesses and individuals avoid.
If you are this person: “What happens if I don’t use a Non-Disclosure Agreement” then go on! This read is for you.
Before you proceed to this blog, if you are new to Non-Disclosure Agreement then you should refer Beginner’s Guide to Non-Disclosure Agreement first.
Reliability is not an issue
Preparing a non-disclosure agreement before time simply means reducing the chances of problems that may occur in the future. The associated parties may have a healthy and fruitful relationship before signing the NDA and after this instance, the relationship continues as it was previously. Getting an NDA signed is making sure that the sensitive information is not leaked. Also, the respective parties are informed of what they are allowed to do and whatnot.
If you don’t get an NDA signed, you’re only left with regret if a vital piece of information is disclosed to competitors or the wrong third-party.
Also, check out Release of Liability Form Template
Losing Rights to Intellectual Property
Nobody is bound to follow the rules when NDA is not signed. It means that your trade secrets can be shared without your permission without having your rights to the patent invention. The money invested in intellectual property will be in vain along with losing time and money invested in its development. It’s a major depression when your business idea is stolen by competitors and beat your business with your trade secrets.
Uncomfortable Exchange of Information
All the parties sharing the trade secret after signing the Non-Disclosure Agreement are more likely to feel hesitant before disclosing sensitive information. Planning and strategizing gets simplified. Most businesses believe that the right information should be disclosed at the right time & NDA ensures that involved parties are more forthcoming with each other.
NDA means more Litigation
NDA is drafted with a purpose. A party may have to suffer more litigation, time, and expense in trying to protect the information or recoup the losses. Thus, it is better to have an NDA signed before any critical situation arises.
Losing Out on Business Opportunities
If any party refuses to sign the NDA, it is their loss. Some arrogant capitalists or investors don’t wish to sign the confidentiality agreement form because they think that they will be bound.
Are there any conditions when NDA is enforceable?
Some think that invalid NDAs can work and comply with its terms; the waters are tested when any of the involved parties enforce it. To understand the reasons behind the enforcement of NDA, let’s check out why they are unenforceable. These are some challenging scenarios with NDA:
- Agreement Terms are overboard
- The Discloser fails to maintain secrecy
- Disclosure to Third-party
- Non-quantifiable Damages
- Inevitable Disclosure Doctrine
Besides this, any of the general reasons making contracts unenforceable apply to NDAs too. It includes inability to contract, undue influence, illegal information protection is attempted or any mistake by one or both parties.