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Before you share the idea: what makes a nondisclosure agreement hold up in Georgia
A nondisclosure agreement protects information only if the information is actually kept confidential and the agreement is drafted to fit Georgia and federal law. Three provisions matter more than the rest.
Responsible attorney: Lou Schwartz, Schwartz & Associates, PC, Atlanta, Georgia. intake@snalawyers.com
Key takeaways
- Georgia law lets parties keep information confidential for as long as it remains confidential or a trade secret [1].
- Information qualifies as a trade secret only if you make reasonable efforts to keep it secret [2].
- An agreement with an employee, contractor or consultant should include the federal whistleblower immunity notice, or you may lose exemplary damages and attorney's fees [3].
- A confidentiality clause signed before a dispute is not enforceable as to a sexual assault or sexual harassment dispute [4].
At a glance
- Duration (Georgia)
- As long as the information remains confidential or a trade secret [1]
- Trade secret test
- Economic value from secrecy plus reasonable efforts to keep it secret [2]
- Worker agreements
- Include the DTSA immunity notice; contractors and consultants count [3]
- Federal limit
- Pre-dispute NDA clauses are unenforceable as to sexual assault or harassment disputes [4]
- Notice applies to
- Agreements entered into or updated after May 11, 2016 [3]
On this page
You are about to show a potential investor, manufacturer or contractor something that took years to build: source code, a customer list, a formula or a pricing model. You want a nondisclosure agreement first. This article covers what makes that agreement effective under Georgia and federal law.
How long can confidentiality last?
In Georgia, as long as the information stays confidential. The Restrictive Covenants Act does not limit how long parties may agree to keep information confidential or treat it as a trade secret, so long as the information remains confidential or a trade secret [1]. A fixed term, such as three or five years, is a business choice, not a legal requirement.
The statute says
“for so long as the information or material remains confidential or a trade secret, as applicable.”
Why do my own habits matter?
An agreement does not create a trade secret. Under the Georgia Trade Secrets Act, information qualifies only if it derives economic value from not being generally known and is the subject of reasonable efforts to keep it secret [2]. If you share the same material without an NDA elsewhere, or leave it unprotected, the agreement may protect less than you expect.
What should the NDA cover?
- A definition of confidential information that is specific enough to apply, with standard exclusions for public information and information the recipient already had.
- A stated purpose, and a promise to use the information only for that purpose.
- Who inside the recipient's organization may see it.
- Return or destruction of materials when the discussions end.
- Whether the agreement is mutual or one-way, which law governs it and where disputes are heard.
What federal rules apply?
Two federal statutes limit or condition confidentiality terms. First, an agreement governing confidential information with an employee should give notice of the Defend Trade Secrets Act whistleblower immunity, and the statute defines employee to include a contractor or consultant [3]. If the notice is missing, the company may not recover exemplary damages or attorney's fees under that Act against a person who did not receive it [3]. Second, a nondisclosure or nondisparagement clause agreed to before a dispute arises is not judicially enforceable as to a sexual assault or sexual harassment dispute [4].
The statute says
“An employer shall provide notice of the immunity set forth in this subsection”
What should I avoid doing?
- Sharing first and asking for a signature later.
- Using an NDA that defines confidential information as everything, which invites a fight over what was actually protected.
- Combining a nondisclosure clause with noncompete or nonsolicitation terms without checking the separate rules that apply to those covenants.
How do I protect my position?
- Label confidential materials and keep a record of what you shared, with whom and when.
- Limit access to the people who need it.
- Use an NDA that fits the deal: mutual for a joint evaluation, one-way when only you disclose.
- For employees and contractors, confirm the immunity notice is in the agreement.
Use the intake assistant below to describe the deal and what you plan to share. An attorney at the firm reviews every request before any document is prepared.
Ask the firm about this
The firm's intake assistant is AI, not a lawyer. It asks a few routing questions and the names needed for a conflict check. Keep the details of your situation for the attorney. An attorney at the firm reviews every request.
When does it make sense to talk to a lawyer?
When the information is central to the value of your business, when the other side sends its own form, when the agreement includes noncompete or nonsolicitation terms, or when you believe confidential information has already been misused.
What's settled, what depends and what's unclear?
Confidentiality may last as long as the information stays confidential [1]; a trade secret requires reasonable secrecy efforts [2].
Whether your handling of the information, after signing, counts as reasonable efforts to keep it secret.
NDAs governed by another state's law follow that state's rules; employee agreements may raise separate restrictive-covenant issues.
How a court treats a definition of confidential information so broad that it covers public material.
Before sharing sensitive material, sign an NDA that defines what is confidential, limits use to a stated purpose and, for workers, includes the federal immunity notice.
How was this article prepared?
It was drafted with AI assistance from the primary sources listed below, then reviewed, edited and approved by Lou Schwartz, the responsible attorney, on the review date shown. Each source was checked on the date listed beside it. The article is general information about Georgia law, not legal advice, and reading it does not create an attorney-client relationship.
Sources
- O.C.G.A. § 13-8-53 (enforcement of restrictive covenants)
- O.C.G.A. § 10-1-761 (Georgia Trade Secrets Act definitions)
- 18 U.S.C. § 1833 (Defend Trade Secrets Act immunity and notice)
- 42 U.S.C. § 19403 (pre-dispute nondisclosure clauses)
How we write and review
- The issue and the stakes appear within the first 100 words, followed by the law the piece covers.
- Every heading is a question a reader would ask.
- Every legal statement cites a primary source checked on the update date.
- Examples are labeled hypotheticals. No testimonials, case results or outcome promises.
- An attorney at the firm reviews and approves every Analysis piece before it is published.
General information, not legal advice. Reading this article or using the intake assistant does not create an attorney-client relationship.