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An NDA That Encourages Collaboration

BlueIron is now using the Ethical NDA in all our new engagements.  The Ethical NDA is available from the Ethical Collaboration Assocation, a 501(c)3 non-profit.

The conventional NDA ensures that one party to the agreement must keep the other party’s secrets.  In a mutual NDA, both parties agree to the same terms.

The conventional NDA prevents you from losing your trade secrets.  Whatever you tell someone under an NDA ensures that you retain ownership.

But why do you disclose your trade secrets?  There must be a business purpose.

Presumably, you will be disclosing your trade secrets to someone else so that the other party can do something.  The other party might build a prototype for you or they might evaluate your information before they make an investment in your company.

In almost every situation that you would disclose your business’s trade secrets, you are forming some sort of beneficial relationship for your company.  In other words, you are hoping that the other party will provide some benefit to your business because they now know your trade secrets.

In virtually every business situation, you probably want a collaborative relationship with the other party.

The Ethical NDA is an agreement that not only protects your trade secrets, but encourages collaboration.

The Ethical NDA classifies the information being discussed into three broad categories: public information, information owned by and relating to projects by the first party, and information owned and relating to projects by the second party.

When we collaborate, we agree that if we are talking about your project, we give any ideas, inventions, suggestions to you – for free.  As a collaborative relationship, we both want feedback, but we also both want the other party to succeed.

In a conventional NDA, if we collaborate on your project, I would own my suggestions to your project.  In a collaborative relationship, I want YOU to own my suggestions to your project.

From a legal IP standpoint, this is a very strong provision.  I am agreeing to transfer all my IP rights to you for any suggestions I make to your project.

The strength of the provision is designed to give us pause.  It means that we make a conscious decision to help our clients.

As with all NDAs and other agreements, we choose how much we want to share with the other party.  Just having an NDA in place does not mean that I should share every detail of every project.  I always have the option to NOT share any suggestions, and in that case, I keep all ownership of that idea.

At BlueIron, our core belief is that by collaborating, we both can get a much better product – and have a better chance of success – than if we operated in our own silos.

The Ethical NDA is how we establish that relationship.