The multi-jurisdictional protection of intellectual property, related trade secrets, know-how and business methodology is moving away from the “standard issue” Non-Disclosure Agreements (the “NDA”), toward a more comprehensive and multi-layered Non-Disclosure, Non-Use, Non-Competition and Non-Circumvention Agreement (the “NDUCCA”). There are a few very good reasons for this development, as we shall demonstrate in this article.
Clearly, the non-disclosure provisions remain in the NDUCCA; however, those provisions are augmented by restricting the use of the protected information in an unauthorized manner by others, through further restrictions regarding non-use, non-competition, and non-circumvention. In short, the NDUCCA restricts the receiving party (often a contract manufacturer) from disclosing the protected information to third parties, limits the scope of utilization which the receiving party can make of the protected information, establishes a comprehensive non-compete restriction on the receiving party and, crucially, imposes non-circumvention language restricting the receiving party from partnering or otherwise joining forces with another party, which may otherwise indirectly allow a third party to utilize the protected information granted to the receiving party. The cumulative effect of these contractual rights, is to allow the receiving party to utilize the protected information in a limited, authorized manner only, while at the same time, “ring-fencing” that right, with enforceable, multi-layered restrictions on improper and unauthorized use.
Please contact Barbeau, Evans & Goldstein, to assist in preparing a NDUCCA to protect your intellectual property, related trade secrets, know-how and business methodologies.