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Confidentiality agreements and disputes

Non-disclosure agreements (NDAs), also known as confidentiality agreements, help businesses to protect commercially sensitive information and their knowledge, ideas and resources. They can help protect confidential information that is an asset to organisation, such as production processes and client databases. An NDA should also be considered in situations where a business needs to provide access to sensitive information to another organisation, such as when carrying out due diligence before the impending sale or acquisition of a company. In these circumstances businesses may choose to enter a mutual NDA.

When confidentiality is breached, a business can lose its competitive edge over its rivals, or the confidence of customers or other organisations can be damaged. This can have a devastating impact on the businesses future profitability and success.

Examples of the misuse of such information include situations where directors or other employees have access to information and then steal it or use it in other ways for their financial benefit. It can also occur when confidential information is disclosed during negotiations which is then released into the public domain to the detriment of one or both of the parties involved. Unfortunately, even an accidental breach can have a catastrophic effect on the commercial organisation involved.

The law provides some protection to information that is confidential, even in situations where no agreement is in place. However, At Libra Solicitors, we believe that with the success of your business at stake, you should consider taking a proactive approach to protecting information that is vital to your organisation.

How we can help

Whether we are advising you in respect of the scope of protection your business needs in respect of specific transactions, or implementing policies which help ensure that your employees understand the need for confidentiality in the work place, our expertise can help your business protect its interests.

In addition, we can provide your business with tailor-made confidentiality agreements and advice as to when and with whom they should be used.  Using such agreements can facilitate the secure, staged release of specific information in business transactions such as the sale of company or a transfer of technology, and can be crucial to protecting your business from breaches of confidentiality.

We can advise you on whether a confidentiality agreement is appropriate to specific business transactions, particularly given that people can have an aversion to signing such contracts unless they are really necessary. If an NDA is required, we can then draft clear, unambiguous documents to meet the needs of your organisation.

In other situations, your commercial partners may regard your signing of an NDA as a prerequisite of doing business with your organisation. If this is the case, we can examine the proposed agreement to ensure clauses such as those covering the scope of the information, any penalty clauses, and the duration of the NDA do not place an unnecessary burden on your business.

Implementing a confidentiality agreement has important advantages that become apparent if something goes wrong.  For instance, should your business suffer a breach and you decide to take action, the contents of the agreement provide written evidence which could strengthen your case and help establish that a duty was owed by the party in breach.

The contract may also set out what the parties consider an adequate remedy for a breach of confidentiality, such as a specific financial sum. Where damages are not an adequate remedy, an agreement between the parties could identify injunctive relief as the appropriate remedy in the event of a deliberate breach by one of the parties. This may encourage the court to use its discretion to grant an injunction should a breach occur.

Agreements involving the transfer of intellectual property may include a provision that requires the parties to enter into arbitration in the event of an alleged breach of confidentiality. We can draft agreements to include these clauses and can advise you on whether they are appropriate to specific situations.

Whatever the circumstances that your business is facing, you can be sure that we will give you clear practical advice that you can use.

Litigation

Unfortunately, breaches of confidentiality do occur. If you believe your business has suffered a breach, or that a breach is about to occur, call us now so we can take immediate action to help limit the damage to your organisation.

We can examine the possibility of applying to the court for interim relief to prevent or halt the breach of a confidentiality agreement. We can also assist you with devising and implementing plans that can allow your business to continue running as smoothly as possible whilst these important issues are being resolved.

In circumstances where using an alternative dispute resolution process such as arbitration is appropriate, we can provide expert guidance and support throughout the course of proceedings.

Should your matter proceed to court, your matter will be led by a QC, barrister or solicitor-advocate, so you can be sure that the advice and representation you receive is of the highest quality.

Following a successful civil action in respect of the breach of an NDA, the court can grant remedies such as injunctive relief and damages. However, a delay in bringing an action before the court could be damaging to the application and limit the remedies available, particularly if the confidential information enters the public domain.

If you are considering starting legal proceedings because of an alleged breach of confidentiality call us now on 01223 632420 to see how we can help you.

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