[conspire] Usage of NDAs in legal flummery

Rick Moen rick at linuxmafia.com
Thu Dec 15 10:53:06 PST 2005

I decided not to send this e-mail to a firm I deal with, in hopes of not
stirring that pot unless it _actually_ becomes an issue.  However, it 
really annoys me that so many computer geeks let themselves be so easily 
manipulated by transparently and insultingly bogus legalistic bullshit
-- and so I hope this draft can be of benefit to some others.


It was a pleasure speaking to you, on Tuesday, December 13, and I look
foward to the opportunity to examine $FIRM's product line.

There was, however, one thing you said that concerned me:  You asserted
that a non-disclosure agreement I signed 2 1/2 years ago is still in
force, and would apply to our telephone conversation that followed.  The
purpose of this e-mail is to share with you the results of my legal
research on that question.  (I am not an attorney, and nothing in this 
e-mail should be construed as me giving professional legal advice to
you, $FIRM, or anyone else.)

1.  In California law, non-disclosure agreements cannot have force 
without exchange of consideration, as that lack causes no contract to
form.  I note that I have not at any point executed any business
contract whatsoever with you or $FIRM, thus far.  Any moves towards such
a contract would have been executory at that time, and had long gone
defunct by the time 2 1/2 years passed.

2.  California law actually voids completely, in Business and
Professions Code §16600, any contract that purports to restrain anyone
"from engaging in a lawful profession, trade, or business of any kind",
to the extent of that retraint.

I am, of course, generally speaking, in the Unix-based IT and network
consulting trade.

3.  §16600's application is of course tempered by California's Civil
Code §3426 et seq., implementing the Uniform Trade Secrets Act, which
specifies the scope of trade secret law in our state.  But those
provisions apply only within an employment or similar business
relationship involving a duty to maintain the information's secrecy or
limit its use, only for a limited period of time, and only for subject
matters within the scope of that business.  Trade secrets, by the way,
are constrained by statute to these areas:  a "formula, pattern,
compilation, program, device, method, technique, or process" that
maintains economic value.  (Customer lists are also trade secrets per
the separate provision of Business and Professions Code §16606.)  You
cannot just declare, say, your next intended product ship date to be a
trade secret and expect your opinion to enjoy legal protection.

As a result of these concerns, I cannot regard myself as bound at this
date to the terms of any NDA I might have executed with you or $FIRM,
2 1/2 years ago:  We do not have that close a business relationship.  In
fact, we do not yet have one, at all.  I'm, by intention, a sympathetic
but very much independent and external party, interested in your firm's
products and services. 

Irrespective of that, I am (and will remain) of course careful to
safeguard the privacy and interests of all persons and firms I deal with
during the course of my business affairs:  Protecting people's
confidences is part of just ordinary business ethics, irrespective of
legal obligations.

I hope this matter does not cause you problems, but I felt ethically 
obliged to bring it to your attention.

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