Abuse of Nondisclosure Agreements

I have a soft spot for nondisclosure agreements, or NDAs (also known as confidentiality agreements): They’re relatively short and straightforward, yet they’re subtle enough that drafters routinely screw them up. And they’re commonplace; in fact, they’re something of a nuisance—the cockroach of the contract-drafting world. These characteristics mean that they’re the obvious guinea pig for anyone contemplating innovation in contract drafting.

But my recent experience with NDAs suggests that getting control of NDAs would involve not only a drafting solution but also persuading people to ease up on requiring NDAs.

Two potential clients asked me to sign NDAs. No bid deal—I signed. But after speaking with decisionmakers, they told me that in fact they wouldn’t be needing my services. They could readily have figured that out before asking me to sign an NDA. I suspect that my experience isn’t unusual and that often people are too quick to ask a potential business partner to sign an NDA. Asking for an unnecessary NDA demonstrates a lack of judgement and experience, could well aggravate whoever it is you’re dealing with, and serves to devalue NDAs generally.

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.