Legal Question in Business Law in California

Non Disclosure or confidentiality forms

What type of form do I need to protect

my business idea while I am

interviewing potential employees?


Asked on 4/15/09, 2:30 pm

1 Answer from Attorneys

Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Non Disclosure or confidentiality forms

You are referring to a non-disclosure agreement, or NDA. Actually, the NDA you would need probably would also have to incorporate some non-compete language as well. I suppose someone has tried to produce and market a "form" NDA for general use, but I haven't seen such an animal, nor would I ever recommend to a client that they purchase and use a fill-in-the-blanks form instead of a custom-prepared NDA.

Business ideas are rather hard to protect because, unlike inventions, trademarks, artwork, literary works, etc., there is little or no inherent legal right to protect an idea from use by others. Ideas are generally not intellectual property, and the law tends to favor free access, competition and no tying up of business ideas in particular. I'm not saying that a well-drafted NDA is of no use, but it is not a strong protection. (This is particularly going to be true with respect to people you interview but don't hire. You have somewhat more basis for enforcing an NDA or similar agreement made with an employee.)

If you have a business idea that is truly unique and valuable, your best bet is to disclose as little of it as possible to interviewees! A lawyer-drafted NDA may also be useful. A third factor in protecting ideas is to choose the people with whom you share the ideas very carefully; this works to some extent when presenting new product ideas to other businesses, because you can check their reputations (more or less), but pre-screening employment candidates for their honesty and ethics is chancy and difficult.

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Answered on 4/15/09, 3:38 pm


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