A Texas Non-Disclosure Agreement (NDA) is a vital legal contract that helps protect confidential information. This document helps safeguard trade secrets and prevent financial losses for companies with competitive advantages. It’s essential in various business scenarios and relationships, including employment, negotiations, and partnerships.
Texas NDA Laws Overview
- Governing Laws: Uniform Trade Secrets Act. (Tex. Civ. Prac. & Rem. Code § 134A.001 — § 134A.008)
- Statute of Limitation: If the plaintiff discovers any misappropriation, they have three years to file a lawsuit against the defendant. (Tex. Civ. Prac. & Rem. Code § 16.010(a))
- Trade Secret Definition (Tex. Civ. Prac. & Rem. Code § 134A.002(6)):
“Trade secret” means all forms and types of information, including business, scientific, technical, economic, or engineering information, and any formula, design, prototype, pattern, plan, compilation, program device, program, code, device, method, technique, process, procedure, financial data, or list of actual or potential customers or suppliers, whether tangible or intangible and whether or how stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing if:
(A) the owner of the trade secret has taken reasonable measures under the circumstances to keep the information secret; and
(B) the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, another person who can obtain economic value from the disclosure or use of the information.
Are NDAs Enforceable in Texas?
Yes, NDAs are enforceable in Texas. However, they must meet certain criteria. For instance, they should protect legitimate business interests, clearly define the nature of the confidential information you’re sharing, and not be unreasonable.
Texas doesn’t specifically mandate the exclusion of information pertaining to sexual harassment and discrimination from NDAs. However, it might be good practice to include these exclusions so that you can nurture a healthy company culture where employees feel safe to share this kind of information.
