Confidentiality and Non-Disclosure Agreements

Most inventors instinctively understand the value of keeping their technology secret. Their main concern is that others, learning of the technology, will beat them to the marketplace.

The law has long recognized the need for businesses to protect confidential information that has commercial value. These trade secrets have been viewed as a property right or as an obligation imposed on the recipient of the confidential information. Courts have viewed trade secret rights broadly and have recognized trade secret rights in technical data, manufacturing processes, customer lists, engineering designs, etc.

Much of the case law is concerned with the circumstances surrounding the receipt of the allegedly confidential information. Trade secret violations are easily found when there is a blatant, outright, unauthorized misappropriation by a stranger, but most cases involved an established relationship. For Example, disclosures may occur during discussions with a prospective purchaser of a business, or a prospective purchaser of technology. In such cases the courts must analyze whether there is a relationship of trust or an implied contract of confidentiality between the disclosing party and the recipient.

To avoid uncertainty, inventors should be careful to confirm, in advance of any disclosure, the fact that the technical information is confidential. This should be done in writing. Some large organizations are very reluctant to accept information in confidence and will often present the inventor with a demand to waive trade secret rights. The inventor needs to go slowly in those situations.

The proper way of proceeding is to have the person receiving the information sign an agreement that recognizes the inventor's trade secret rights, requires the reviewing party to keep the disclosure in confidence and not use it without further permission. Such an agreement needs to be properly prepared and signed before the disclosure is made. 

Performing a
patent search.

Keeping an idea

Applying for a
utility patent, or a design patent.

Provisional patent applications.

Protecting your invention abroad especially in


Although high technology inventions in the computer and biochemical field receive much attention, simple inventions are often just as important commercially. Thomas Adams

E-Mail (Use Subject Line: "new idea"): adams@newidea.com  
Voice: 973 463-0100  -- Fax: 973 463-0150

Return to the home page.