What Is a CIIAA?
A confidential information and invention assignment agreement (CIIAA) is a legally binding contract that protects company information. It’s entered into by an employer and the person they hire, whether an employee or an independent contractor.
A CIIAA ensures that the employer keeps ownership of any work that the employee or contractor creates while they’re with the company. It also includes confidentiality clauses to keep private details secure, such as the following:
- Trade secrets
- Customer information
- Technical details
- Financial data
- Operational information
- Personnel data
By entering into a CIIAA, employers gain the following protections:
- It safeguards your confidential information during and after an individual’s time with the company.
- It ensures that your business owns the inventions and creative work that make it valuable. Investors often look for this proof before they invest in your company.
- It prevents competitors from accessing your proprietary ideas.
What to Include in a Confidentiality and Invention Assignment Agreement
A confidentiality and invention assignment agreement protects sensitive details and secures ownership of IP. Below, you can review the key elements to include in your CIIAA to protect your competitive advantage.
1. Parties and Employment Relationship
Begin by identifying the disclosing and receiving parties. Provide their names and addresses, and state whether they are individuals or entities.
Is the Receiving Party an Independent Contractor or an Employee?
Ensure that you clarify whether the person creating the IP and being bound to confidentiality is an independent contractor or an employee. Legal Templates’s form is primarily designed for receiving parties who are independent contractors.
However, it also includes language that upholds the confidentiality and IP clauses if the independent contractor is later classified as an employee. The agreement continues to protect the company if the individual was mistakenly classified as a contractor or if they are later rehired as an employee.
2. Purpose and Duties
Reference the employment contract or independent contractor agreement that you have entered into with the receiving party. State that the employee or contractor will perform their duties as stated in the relevant contract. Provide any additional context for the business relationship between the two parties.
3. Confidentiality
Describe the employee’s or contractor’s duty to keep certain information confidential. You can limit the confidentiality period to the individual’s time with the company or extend it for a specified period after they depart. Note that they can only use the confidential information to assist the company and cannot produce unauthorized copies.
Some examples of information that must be kept confidential under a CIIAA include:
- Trade secrets
- Know-how
- Technical data
- Engineering designs
- Software code
- Processes
- Formulas
- Hardware configuration information
4. Ownership of Inventions
Clarify that the company owns anything the employee or contractor creates during their relationship with the company. This is the “assignment” aspect of a CIIAA.
Dictate exceptions for prior inventions and list them in a separate exhibit that is attached to the agreement. If the employee or contractor owns licenses for their pre-existing inventions, they can grant the company a permanent, free license to use them.
You can also require the employee or contractor to assist the company in acquiring a patent for an invention they helped work on.
5. Company Property
Highlight that there is no expectation of privacy when using company property. Also, note that the employee or contractor must return company property and data without keeping records when they end their relationship.
Mention the requirement for the employee or contractor to sign a termination certification upon leaving the company. This document confirms that they follow all the rules in the CIIAA and return all property when they depart.
6. Notice to Third Parties
Outline the company’s right to tell the employee’s or contractor’s future employers about confidentiality and non-solicitation agreements. This right ensures that the worker’s new employer is aware of these rules, helping prevent competitors from using trade secrets and customer lists.
Non-Compete Agreements
Consider entering into an employee non-compete agreement or an independent contractor non-compete agreement where legally permissible. These contracts can work alongside your CIIAA to provide further protection for company resources.
7. Solicitation of Employees, Independent Contractors, and Other Parties
Include a clause clarifying that the employee or contractor cannot solicit the company’s employees, contractors, or clients for some time after the contract expires (usually 12 months).
8. Representations and Covenants
Include certain representations and covenants, having the employee or contractor promise that they:
- Are not breaking old contracts by entering into this one
- Are not using a previous employer’s secrets for the current company
- Will disclose any other jobs they have that might conflict with the work for the current company
9. Governing Law and Severability
Name the state whose laws will govern the CIIAA. Clarify that the contract will still be enforceable even if one provision is later found to be invalid.
Confidential Information and Invention Assignment Agreement Sample
View an example of our confidential information and invention assignment agreement to see how to keep your company’s IP secure. Draft yours using Legal Templates’s guided form, then download a copy in PDF or Word format.
Limits on Confidential Information and Invention Assignment Agreements
Some states impose restrictions on confidential information and invention assignment agreements. In the following states, an employer generally cannot claim inventions created on an employee’s own time and without the use of company equipment or secrets:
- California (CA Labor Code § 2870)
- Delaware (19 DE Code § 805)
- Illinois (765 ILCS 1060/2)
- Kansas (KS Stat § 44-130)
- Minnesota (MN Stat § 181.78)
- New Jersey (NJ Rev Stat § 34:1B-265)
- New York (NY Lab L § 203-F)
- North Carolina (NC Gen Stat § 66-57.1)
- Utah (UT Code § 34-39-3)
- Washington (WA Rev Code § 49.44.140)
CIIAA Rules in Nevada
In Nevada, the employer owns any inventions or trade secrets created by an employee during work hours that relate directly to the job. You can state otherwise, but it must be written in an explicit agreement (NV Rev Stat § 600.500).
