Choosing the Right NDA

Many companies have one nondisclosure agreement that they use in all situations. This is usually a mutual NDA, and is used regardless of the type of information being shared or which party will be disclosing more information. In situations where your company will be only receiving or only disclosing information, you will want to use a more appropriate form. Similarly, if the information being disclosed is particularly sensitive, you will want increased protection.

Every company should have a set of form NDA’s that are suited for various situations. This basic kit should include:

• A one-way outbound NDA, for use when your company is the only party disclosing confidential information;
• A one-way inbound NDA, for use when receiving information;
• A one page short form mutual NDA, for use in low risk situations (e.g., non-sensitive information);
• A restrictive mutual NDA, for use when your company will be disclosing most of the information, or sensitive information is involved (e.g., source code);
• A non-restrictive mutual NDA, for use when your company will be receiving most of the information; and
• A nonconfidentiality agreement, for use when your company wants to be clear that none of the information received by the either party should be considered confidential.

Your attorney should be able to provide you with a kit along these lines at little or no charge. In the coming weeks I will try to post some examples.