Legal Question in Business Law in California

I provide media relations services to technology start-ups. I entered into discussions with a company and following discussions and signing a retention agreement, starting providing services. We did not signed a Non-Disclosure Agreement at any time. The relationship with the client did not really work and I had an opportunity to provide services for one of their competitors. There was a short overlap in the terms of the ending of the first agreement and commencement of the second, so I informed the company that I would no longer be providing services and would be entering into a relationship with the competitor. The client then asked me to sign an NDA with very broad provisions regarding restrictions on disclosure of confidential information. I don't think I'm under an obligation to sign the agreement, but what are my risks under CA's unfair competition statutes if I do or don't sign? And can someone sue me as a service provider rather than employee? And is the best idea to negotiate the terms of the NDA to limit the definition of confidential information? Thanks.


Asked on 6/22/11, 9:49 am

3 Answers from Attorneys
Shawn Jackson The Jackson Law Firm, P.C.

No, at this point you are not obligated to sign any NDA. With that being said and with the understanding that it is a small busines community and you may want to do business with this company again (or one of their associates) it is often better to enter into some type of mutually acceptable agrement with everyone so long as it does not impinge on your ability to earn what you need.

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Shawn Jackson ESQ. (707) 584-4529

Business Development Attorney

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Answered on 6/22/11, 10:08 am

I agree with Mr. Jackson that you are under no obligation to sign any NDA at this point. Whether you are an employee or a consultant, however, you are still under a general obligation not to disclose trade secret information of one company to another, and you would be liable for damages if you did. It therefore may be in your best interests to have an agreement with the firm you were working with on exactly what trade secrets you have acquired and will not disclose. That way, having been given the opportunity to delineate exactly what you agree not to disclose, they will not have much of a chance if they later try to come after you or the other company if you disclose something else.

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Answered on 6/22/11, 11:02 am
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Mr. McCormick's advice is sound. Signing an acceptable agreement is the best course, steering midway between one that is overly restrictive and none at all.

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Answered on 6/26/11, 4:00 pm


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