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Important Details For NDAs


It is not uncommon for companies in New Jersey to find themselves in a position where they must share sensitive business information with third parties. These third parties might be distributors, suppliers, partners, vendors and even employees. In some cases, if the information sharing is not allowed, essential business functions may suffer. In order to facilitate these functions while still protecting companies, nondisclosure agreements are commonly created.

As explained by Forbes, it is important to clearly identify what information is deemed confidential and is therefore covered by the terms of the nondisclosure agreement, or confidentiality agreement as it may also be referred to. Despite any temptation, the definition of the confidential information should be as focused and narrow as possible to avoid any ability that it may be misinterpreted. Such misinterpretation could pave the way for a dispute down the road unnecessarily so the upfront clarity is in everyone’s best interest.

In addition, companies should carefully outline what will or will not happen should a dispute between the parties arise. For example, the contract may stipulate that some form of alternative dispute resolution such as mediation should be attempted prior to one party resorting to litigation. When the parties are in different states, the contract should specify what jurisdiction will rule the contract and any potential conflict.

If you would like to learn more about how to properly protect your business when sharing sensitive information, please feel free to visit the nondisclosure agreement page of our New Jersey business and contract law website.


Understanding how this affects the small business economy is part of our job here at Santomassimo Davis LLP, as we primarily focus in providing expert Outside General Counsel for a variety of law firms and legal issues related to Corporate and Business Law  in New JerseyNew York and Pennsylvania.

Thanks for reading our latest blog talking about topical legal issues facing small businesses. Learn more from our Outside General Counsel Blogs.


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