Non disclosure agreement

Discussion in 'Legal Issues' started by Realtimerod, Jul 27, 2007.

  1. #1
    Hi again,

    I am looking to get some design and programming work for an upcoming project but my biggest concern is that my idea is so great that the company I go through to create the site will steal my idea.

    I'm not sure how to write an agreement to cover myself, or where to get a decent one.

    :confused:
     
    Realtimerod, Jul 27, 2007 IP
  2. Nectarine

    Nectarine Peon

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    #2
    For most design/development projects, an NDA is overkill. There are very few original ideas in the world of online business, truth be told. If someone wanted to steal your idea, they would have to do it very fast and even then it would be easy for you to prove they had stolen the idea since you're paying them to do the job for you.

    A much better protection would be to write up a quick agreement about what they're doing, mail them two and have them sign and mail one back. Unless you're already paying them industry-standard or above, most people will not deal with the extra hassle without extra money. I personally would not bother going through all the trouble unless the project was worth more than $1000 to me. That's probably a little high, but I've had many, many people try to get me to sign an NDA for a $50-200 project and having this in place already saves me from having to refuse the project later. Save the NDA for when you're needing $10'000 of work, not $500 of work and you'll save a lot of hassle in the progress.

    Please also keep in mind that if you've already agreed to have them do the project, you can't go back and make it a condition for them to be paid. They'll just invoice you and send it to a collections agency if you don't pay it. This is especially likely if you didn't mention this before having them start work.

    Talk to them about your concerns. In all likelihood, they've had other clients with similar concerns and will be able to help you with ideas on how to protect yourself and your business.
     
    Nectarine, Jul 27, 2007 IP
  3. AstarothSolutions

    AstarothSolutions Peon

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    #3
    NDAs are not over kill no matter what the value of the project is however you have to carry the cost of the NDA if you want one signed. We bill at approximately $80 an hour (thanks to the weak dollar). If we have bid $200 for a project do you want to increase that bid by adding the time for us to read the NDA, potentially make amendments and send it back and then have to read it again when you send it back to make sure you have made the amendments etc?

    Whilst it was for much larger projects we have previously had need to have our solicitor involved in agreeing contractual documents including NDAs and they bill at $700 an hour.

    That said and done, if it is an "idea" rather than corporate data then it is next to impossible to enforce anyway as how can you prove that they got the idea of combining facebook and ebay from you and not from somewhere else?

    Secondly, development agencies get their money from developing websites not from running their own websites. We have more work from clients coming in than we have time to deliver and therefore certainly dont have time or any inclination to start developing sites for ourselves rather than our clients.
     
    AstarothSolutions, Jul 30, 2007 IP
  4. Nectarine

    Nectarine Peon

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    #4
    At least in regards to the clients that I've worked with, this seems to be the only thing that drives them to seek an NDA: this notion that an idea (however vague) can be protected by an NDA. Often it's not even for the project at hand, but because they've mentioned an unrelated idea during conversation the client sometimes thinks that the only way to prevent me from coming out with the same site is to bring an NDA into the picture.

    As you pointed out, it's really not enforceable at all for that. An idea is just that, and there is no guarantee that someone else hasn't already thought of it.

    Interesting story (or not): I was having a conversation with a potential client when he came out with an "idea that will revolutionize the industry!" -- problem being that sites like that already existed, and almost everyone I talked to from that niche in the past six months had essentially the exact same idea. Some revolution. It's a great money-maker and not many people do it (it's a lot of work lol), so I still suggested that he do it but advised him that I'd heard the idea from several people. I heartily suspect that in six months there will be quite a few of these sites online. :D

    Long story short: In my opinion, unless the data in question is one of the keys of your business or constitutes "insider knowledge" (customer lists etc), I'd say forgo the NDA. But that is just my opinion.
     
    Nectarine, Jul 31, 2007 IP
  5. Dino

    Dino Peon

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    #5
    What I did when I was hiring beta testers for a project was get a NDA template and modified it to suite my project. These lots of legal template sites around if you google "nda contact template".
    Then I sent them to a webpage with the NDA and a contact form script embed with an I agree box. They filed out the form with their personal details and clicked agree and this info was tied to their IP.

    This whole process was more of a scare tactic and I'm not sure if this was at all enforceable especially since some beta testers were from other countries.

    Hope this helps.

    Dino
     
    Dino, Jul 31, 2007 IP