What Happens if You Break an NDA?
Signing a Non-Disclosure Agreement (NDA) is a serious commitment, legally binding individuals to maintain confidentiality about classified or proprietary information. However, breaches can occur, leading to significant repercussions for both parties involved. So, what exactly unfolds when an NDA is broken?
Breaking an NDA means that one party has done something that conflicts with the agreed-upon obligations and terms stipulated in the signed agreement. Whether intentional or not, disclosing protected information to external parties constitutes a breach of contract, thereby violating the NDA.
What is an NDA?
A Non-Disclosure Agreement (NDA), serves as a vital legal tool in safeguarding sensitive information shared between parties.
At its core, an NDA establishes a confidential relationship between the parties involved. One party commits to maintaining confidentiality by refraining from disclosing the received sensitive information to external people or organisations.
NDAs are prevalent in business dealings, particularly during negotiations between companies. They facilitate the exchange of sensitive data without the looming threat of it falling into the hands of competitors. In scenarios where both parties share confidential information, the agreement is termed a mutual non-disclosure agreement.
For example, an NDA could be used in an employment settlement agreement to ensure that the employee doesn’t disclose the amount of money they have received in the final settlement for instance.
What Can Happen if You Break an Agreement?
Investigation: From the moment an NDA breach is discovered, companies typically initiate a thorough investigation. This involves gathering evidence to pinpoint the leaked information, its recipients, and the responsible party. Depending on the circumstances, HR, legal, and security teams collaborate to scrutinise the breach and evaluate compliance with the NDA's terms.
Assessing Legal Action: The outcome of the investigation dictates subsequent actions. If sufficient evidence implicates an individual in the breach, the affected party may opt for legal recourse. Factors like the breach's severity, financial implications, and intent are weighed to determine the viability of legal action.
Reviewing the Agreement: While NDAs are stringent, exceptions exist depending on jurisdiction and agreement terms. Situations such as expired NDAs or instances of criminal wrongdoing may mitigate liability. Consultation with legal experts is vital to assess potential exceptions and navigate legal proceedings effectively.
Breach of Contract: Should the affected party pursue legal action, both parties engage in court proceedings. Courts evaluate the breach, its impact, and any applicable exceptions to determine appropriate remedies. Legal representation is crucial throughout this process to safeguard interests.
Automate Your NDA
Wrapping your head around the legal side of your business can be intimidating. Gerrish Legal’s contract automation tool cuts down the time you waste worrying about getting the small print right. All of our service agreements have been drafted by our in-house lawyers based on their years of experience. Upon purchase, you’ll be asked questions which will let us tailor your NDA to suit your needs. Your tailor-made contract will be sent to your inbox straight away! All purchases and use of our portal are governed by our Contract Automation Terms of Service.
How Can Gerrish Legal Help?
Gerrish Legal is a dynamic digital law firm. We pride ourselves on giving high-quality and expert legal advice to our valued clients. We specialise in many aspects of digital law such as GDPR, data privacy, digital and technology law, commercial law, and intellectual property.
We give companies the support they need to successfully and confidently run their businesses whilst complying with legal regulations without the burdens of keeping up with ever-changing digital requirements.
We are here to help you, get in contact with us today for more information.