When do ndas expire

Those states reason that if the information will be so out of date in a few years that it could not benefit a competitor, then it does not need to be protected for more than a few years. Some states may enforce an NDA with no time limit only with respect to trade secrets but not confidential information; other states may find an NDA totally unenforceable if it has no time limit but seeks to protect confidential information.

Additionally, a company should be consistent among the NDAs it enters into, as a discrepancy among the duration of NDAs could imply that the confidential information should be protected only for the shorter of the time periods.

Finally, as noted above, the rules of enforceability vary significantly by state. Accordingly, drafting every NDA requires careful consideration of the parties involved, the information to be protected, and the state in which the agreement will be enforced.

One size clearly does not fit all. The key point to remember is that whichever word you choose, make sure to use it consistently. This can mean one of two things, though.

Either the business relationship is ongoing and perpetual OR the confidentiality of the proprietary information is permanent , such as the trade secrets we discussed earlier. Non-terminating agreements are useful for ongoing relationships or the protection of trade secrets and other information that should remain proprietary indefinitely.

In this example from Iowa State University business resources page , the non-disclosure agreement is signed between two parties that anticipate an ongoing relationship that can only be terminated in writing by one of the parties.

This particular clause notes that confidentiality shall be maintained even IF the non-disclosure agreement is terminated at some point, i. There are different schools of thought on this, but if your confidentiality and non-disclosure requirement should expire at different times, then a specific duration clause may be the best way to differentiate the two.

If the confidentiality and the non-disclosure agreement expire or terminate at the same time, then the term or duration of the agreement can be built into the obligation portion of the agreement. Something as simple as saying:. The business and legal worlds like to think in terms of years, so these agreements are often established for a period of 1, 3, 5 or even 10 years. Depending on the purpose of the business relationship, this gives the parties time to collaborate or negotiate as well as leaves time to tie up loose ends.

The terms of your agreement should be realistic about how long the project or collaboration will take. Joint ventures, for example, may last for years, while a one-time development project may last no longer than a year. The longer they have access past the point of necessity, the higher your chances of a facing a breach.

For an example of a contract with a survival clause, click here! To see a standard non-disclosure agreement, click here or visit our Small Business Law Library! Survival Clause The exception to all the obligations being terminated on the termination date is where a survival clause has been included.

Confidential Information. Generally Used Clauses. Company Formation.