Using a Non-Disclosure Agreement in Arkansas
To protect your business interests, trade secrets and information regarded as confidential, you need to ensure that the persons who could access such information remain mum and protect that information, especially if that information and its secrecy is the reason for your competitiveness.
While there are a few cases where an oral confirmation is all you need to rest easy about the safety of that information, it is prudent to engage the use of a legally binding document such as the non-disclosure agreement (NDA) or a confidentiality agreement in Arkansas (CA)
What is a confidential agreement?
This is the document that is used to protect business interests by defining and protecting confidential information which could be exchanged in a professional or a business relationship. It is commonly used in new hires by employers when they company handles sensitive information that defines the unique position of the company. The NDAs are common in pharmaceutical companies, technology firms, financial institutions, and other high-risk organizations.
What are trade secrets?
A trade secret refers to the information, which could include a pattern, compilation, formula, device, technique, process or method which gives a company its actual or potential economic value (independent) from the fact that is unknown to others in the industry, as well as the company's direct competitors. The information/ trade secret could also be a subject of the efforts that are considered reasonable under the circumstances created to maintain the secrecy of the information.
Misappropriation of the NDA/ trade secrets
The statute of limitations has a 3-year limit during which, misappropriation of the confidential information should be presented in the court of law. In case you are wondering, misappropriation refers to the theft of trade secrets. It could also be used to refer to the acquisition of a trade secret by an individual who knows or has reasons to know that the confidential information/ trade secret's acquisition was through improper means.
Some of the improper means which could result in the acquisition of trade secrets include breach of duty, inducement of the breach of duty, bribery, misrepresentation, or theft. It also includes a disclosure or even the use of a trade secret without the consent of the person who acquired the details of the trade secret improperly.
What makes an enforceable NDA?
Identification of the parties to the NDA
This section has the definition of the confidential information as well as the establishment of the rules that discern the contract or the subject of the NDA.
The list of exclusions - the information that is not considered confidential because the receiving party researched about the information on their own, obtained the information through reverse engineering, or because the information is available in the public domain.
Obligations of the receiving party and consequences of a breach of contract - Under this section of your free Arkansas non-disclosure agreement form; it's also indicated that in the event of a breach, the party responsible for keeping the secret will take full liability. Note that the receiving party is also obligated to keep the contents of the NDA and their access restricted at all times. Parties on the 'need to know' basis have to sign NDAs as well. And the receiving party should not publish, copy or reveal the trade secret for his or her own benefits.
The time period indicating how long the receiving party is expected to keep the information confidential or when the information will no longer be deemed confidential.
Finally, the parties to the NDA must put down their names and dated signatures for the creation of a confidential legal relationship.
Other clauses in the NDA include severability, integration and waiver clauses.
Non-compete agreements in Arkansas
Non-competes refer to the legal documents created to ensure that a former employee cannot work for your competitors, start a company like yours, or solicit clients, on top of the fact that they have to maintain the confidentiality of your trade secrets for a specific duration. Since some employers set extreme conditions that could make it impossible for an employee to earn a living, the courts evaluate the contents of the document and only approve it if it's reasonable.
Recent developments and updates on the state laws around non-competition covenants indicate that the courts can enforce the document as long as some of its elements are reasonable. This means that it will delete overboard and unenforceable provisions of the non-compete rather than strike out the whole document.
Under the new laws, the non-compete is enforceable if it’s related to an employment relationship or if it's part of an employment agreement that is otherwise enforceable. This will happen only if the employer has a great deal of legitimate and protectable business interests or if the document is limited with regards to time and scope so that there is no circumstance greater than necessary needed to protect the business interests.
Even if the document lacks a definitive geographical restriction, it will be deemed reasonable if the document spells a limitation in the time that it's effective.
But without a time limitation, the court will only approve the document if it is reasonable in time and geographical scope.
The state accepts continued employment as adequate consideration for the non-competition contracts. But, this does not apply to non-solicitation contracts.
Are you looking for a free non-disclosure agreement in Arkansas today? Get started with our NDA forms accessible from all cities including Little Rock, Hot Springs, Fayetteville, Cornay, Pine Bluff, Springdale, and Rogers among others.