Kentucky Non-Disclosure Agreement
The Kentucky Non-Disclosure Agreement (“Confidentiality Agreement” or “One-way Agreement) is a document signed by two (2) parties, restricting one (1) of the parties from sharing the secret information shared by the other party (the “Disclosing Party”). Once signed, the party learning the information (called the “Receiving Party”) is legally required to keep it a secret, and can face financial repercussion in the event of a breach of contract.
Signing an NDA can prove invaluable in several scenarios. For example, an NDA can ensure the design for a newly developed piece of technology is until a patent is acquired. An NDA can also be used by when conducting interview with potential employees, to ensure that any confidential information disclosed during the interview is not later leaked.
Trade Secret Law
Kentucky’s Uniform Trade Secrets Act, Chapter 365 (§§ 365.880 through § 365.900), covers how trade secrets are handled with respect to the court of law, including when damages will be rewarded as well as an injunction issued. Both parties should keep in mind that in order for an NDA to be valid in Kentucky, it must uphold any relevant state laws. By implication, an NDA that contains any conditions that contravene the Kentucky Uniform Trade Secrets Act may not be upheld in court—even if it is evident the Receiving Party disclosed confidential information covered by the NDA.
Thus, in order to ensure the NDA is in fact legally valid and will hold up in a court of law, the Disclosing Party should read through all sections of the state’s Trade Secrets Act. The Disclosing Party should also familiarize themselves with the Act so they are aware of their rights and responsibilities as a party to an NDA. The Act is organized into different sections, which have been provided below with a short explanation of what matters the section addresses.
- § 365.880: “Definitions” – The definitions of four (4) commonly used terms throughout the following sections.
- § 365.882: “Injunctive relief” – Situations in which an Injunction will be issued by the court
- § 365.884: “Damages” – When damages (from misappropriation) will be awarded to the complainant
- § 365.886: “Attorney’s fees” – What constitutes having the court pay for the winning party’s attorney’s fees
- § 365.888: “Preservation of secrecy” – Steps the court will take to protect the complainant’s trade secret(s)
- § 365.890: “Statute of limitations” – The timeframe required for bringing a case of misappropriation
- § 365.892: “Effect on other laws” – How §§ 365.880 – § 365.900 affects other laws within Kentucky’s Legislature
- § 365.894: “Uniformity of application and construction” – Generally infers that the Kentucky law is meant to be the same as other states trade secret laws
- § 365.896: “Short title” – That §§ 365.880 – § 365.900 should be cited as the Uniform Trade Secrets Act
- § 365.898: “Severability” – If certain parts of the act are not applicable, the other sections still apply
- § 365.900: “Effective date” – Any misappropriation prior to July 13th, 1990 does not apply (except for certain circumstances)
How to Write
Step 1 – Download
Step 2 – Edit & Prepare
The first action that should precede all others, is to have the Disclosing Party read through the agreement, adding or removing sections or text that do not fit the situational needs. This step should not be considered optional, as almost every situation is unique, requiring the document to be equally customized to match.
When a suitable agreement has been devised, the parties should convene and go through it together. Any agreed-upon final changes should be made during this stage. Upon finishing arbitration, the contract can be completed. At the top of the document, enter the Date that the parties are signing the contract (day and full year). Then, the Disclosing Party, followed by the Receiving Party, must enter their respective Name and Address.
Step 3 – In the columns at the bottom of the second (2nd) page, both parties are required to write their Printed Names, their Titles within their companies, the Dates they are signing the agreement, and finally, their Signatures. Once all of the steps noted in this guide have been completed, the Kentucky NDA will be considered, in the eyes of the law, to be active.