Michigan Non-Disclosure Agreement
The Michigan Non-Disclosure Agreement (NDA) has a number of practical applications for any individual or company that needs to share one or more of their Trade Secrets (confidential information) with another party. Given its status as a legally-binding agreement, once executed, a Non-Disclosure Agreement significantly minimizes the chances of the party obtaining the confidential information (the “Receiving Party”) from misappropriating the confidential information of the party who shared it (the “Disclosing Party”).
For this reason, it has become commonplace to execute an NDA in a variety of business contexts, from onboarding new employees to sharing business plans with investors. If the sensitive information is shared with the general public or a competitor, the Disclosing Party can bring the Receiving Party to court. If the court rules that a breach of contract has occurred, the court may require the receiving party to pay damages to the Disclosing Party.
Trade Secret Law
Michigan adopted the Uniform Trade Secrets Act (UTSA) in 1998, which is an Act designed to make trade secret laws more homogeneous to aid companies that operate in multiple states. To ensure the confidentiality agreement(s) sign can hold up in a court of law,
It is highly recommended that any individual or entity considering creating an NDA come to an understanding of what actions the Act permits and does not permit. Any individual or entity presented with an NDA should also arm themselves with the knowledge of what is and is not allowed under the Act. As a useful starting point, an outline of the Trade Secrets Act (Act 448) that applies in Michigan can be found below:
- § 445.1901 Short Title: The name by which the Act should be referred to.
- § 445.1902 Definitions: The definitions of “Improper Means, “Misappropriation,” “Person,” and “Trade Secret”.
- § 445.1903 Injunction: Covers when injunctions will be issued by the court.
- § 445.1904 Recovery of Damages: Explains the contexts in which damages from misappropriation will be rewarded.
- § 445.1905 Attorney’s Fees: Lists factors that must be evident for the court to award reasonable attorney’s fees to the prevailing party.
- § 445.1906 Preservation of Secrecy: States the types of actions, such as holding in camera hearings, that the court may employ in an effort to preserve the Disclosing Party’s trade secrets.
- § 445.1907 Statute of Limitations: Establishes that a case of misappropriation must be brought within three (3) years within discovering the wrongdoing.
- § 445.1908 Other Laws: Clarifies how Act 448 impacts other laws in Michigan’s Legislature.
- § 445.1909 Construction of Act: States the Act is applicable to the states enacting it.
- § 445.1910 Effective Date: Any misappropriation occurring before Oct. 1st, 1998 does not apply to Act 448.
How to Write in PDF & Word
Step 1 – In the first of a total of three (3) steps that must be taken to create a legally-valid Michigan Non-Disclosure Agreement, the parties must work their way through the contract and make any changes to it on an as-needed basis. Taking this step to ensure both the Disclosing and Receiving parties agree to the terms of the NDA from the outset will minimize any possible complications in the case that the contract is broken.
Step 3 – On the first (1st) page of the NDA, three (3) pieces of information from both the Disclosing and Receiving Party must be recorded. That is:
- The Date the NDA is entered into,
- The Names of the Parties, and
- The Addresses of the Parties.
Step 4 – On the second (2nd) page, a further three (3) pieces of information from both the Disclosing and Receiving Party must be recorded before they sign their name to the NDA. That is:
- The Printed Names of the Parties,
- The Company Titles of the Parties, and
- The Current Dates the parties are respectively filling out the NDA.
Once complete, both parties will need to record their Signatures. This can be done digitally using the PDF version, or manually after printing the Word version.