The need for strong confidentiality agreements was highlighted in the environmental product liability litigation, which resulted in a $236 million decision against ExxonMobil last week. One of the plaintiff`s leniency witnesses was an expert witness who had previously worked as a consultant for a defendant on projects that were directly related to the issues of the dispute and that were exposed to the defendant`s confidential information. The respondent did not ask the consultant to enter into a non-disclosure agreement during the project. The defendant attempted to prevent the plaintiff from appointing the expert in the lawsuit against him, but the court dismissed the defendant`s claim, largely due to the lack of a confidentiality agreement with the consultant. According to the court, if the defendant had been genuinely interested in the secrecy of the information, he would have clearly expressed his expectations to the consultant in writing by including a confidentiality clause in the consulting contract. 3.0__ This Agreement constitutes the entire agreement on the subject matter between the parties and supersedes all prior and contemporaneous agreements between the parties, unless such other agreement expressly relates to this Agreement and is enforced by both parties. This Agreement may only be amended, revoked, modified or otherwise amended by a written document signed by all parties. While key employees often enter into confidential information contracts, too many companies don`t take the time to insist that consultants who pose an even greater risk execute the type of agreement described below. True, many consultants have their own agreements, which they insist that the company using their services execute, or they refuse to work and may hesitate in the face of a confidentiality agreement. If this is the case, at least the presentation of the agreement below will bring to the surface a problem that should be solved, and the company will be able to determine if it wants to move forward in the face of the possible dangers that have been led. When drafting a confidentiality agreement, there is often a tension between the client`s desire to keep sensitive information confidential and a consultant`s potential obligation to report information to government regulators. Reporting obligations imposed by federal, state, and local laws may limit a client`s ability to obtain full protection from disclosure by an advisor. In the environmental context, for example, anyone who may have a « control » of the plant where the release took place is required to report it to the EPA if contamination of hazardous substances is detected as part of the transaction`s due diligence review.

In some states, such as New Jersey, « any person » who discovers a discharge from an underground storage tank is required to report it to state authorities. In these circumstances, even the best written confidentiality agreement does not protect information discovered by a consultant from disclosure. An appropriate confidentiality clause should take into account the need for the consultant to comply with mandatory reporting obligations while respecting a company`s desire to maximise confidentiality and maintain control over any communication with supervisory authorities that may be necessary. Finally, it is generally advisable to also include a « conflict of interest » provision to prevent a consultant from using their work product against that client in any way, in any forum and without the prior written consent of the attorney, and to reserve the final say to you or your lawyer as to whether there is a conflict or potential conflict. The clause should also require that any communication with the government by the consultant be released by the client or his lawyer. The reservation should include the wording that, if the advisor believes that he or she must promptly contact a government agency before obtaining such consent, he or she will give the client or legal counsel a reasonable opportunity to make such a disclosure first and, in any case, will require the advisor to promptly inform the client of such communications. Recent developments have highlighted the risk of hiring an external consultant to work on a project without an enforceable confidentiality agreement. Increasingly, consultants are using the experience they have gained working for industrial clients as a springboard to sell this expertise later in lawsuits against these and other clients in the industry.

As an entrepreneur, you`ll be well served if you have strong confidentiality agreements in place to prevent a consultant with sensitive information from going back years later and using the same information in a future lawsuit against you. It is strongly recommended to use the following form. Variations of this for employees are also available on the retention site. Please note that in addition to the standard agreement that most consultants will already insist on, it can be stated that the company will be signed, but in this case, both agreements must be carefully examined for conflicting provisions, as the arbitrator (or court) will have to go through a lengthy (and costly) process in a conflict that creates ambiguity, to dispel ambiguities. The easiest way to resolve these ambiguities is for the parties to simply write on the agreement below that this agreement replaces and supersedes any conflicting provisions in any other agreement between the parties and lets all parties initialize the added clause. It is true that the theft of a trade secret by a consultant is enforceable. The problem is cost (you go to court, not arbitration, minus the agreement below) and evidence (note the assumptions in the agreement below).) Entering into such an agreement may also have a deterrent effect on advisors who would otherwise consider their access to the information to be consistent with the implied agreement that they may use the information for their future activities. (c) The Consultant may not provide, disclose or report the work results or non-public information received or created under this Agreement to any federal, state or local authority or any other public or private person or entity without (i) the express prior written permission of the Client or (ii) any judicial or governmental order requiring disclosure. In the event that the Consultant believes that it is required under applicable law to disclose a work product or non-public information, or that it is served with a court or regulatory order requiring the disclosure of a work product or non-public information, it will promptly inform the Client in writing and in accordance with the Client`s instructions for such subpoena or court order.

Respond, appeal or challenge prior to disclosure, and will fully cooperate with Customer to respond, appeal or challenge any such subpoena or court or government order. Neither the Consultant nor its affiliates may disclose any Work Product or Non-Public Information to any person or entity, or use or permit any Work Product or Non-Public Information to be used to promote private interests other than those provided for in this Agreement. The Consultant shall take appropriate measures to ensure the confidentiality and protection of all work results and non-public information and to prevent their indicative or unintentional disclosure or inappropriate use by the Consultant or its subcontractors or by its employees or affiliates. This obligation shall survive the expiration or termination of this Agreement. The nature of employee costs is such that more and more companies are using « experienced » consultants to perform more and more of their work, from marketing or efficiency analysis to more mundane accounting or software tasks previously performed by employees. (a) The Consultant`s Work Product means all material products, data, reports, information recorded by any means, documents, written documents and any other Work Products or parts thereof, including designs created, generated or provided by the Consultant in connection with the provision of the Consultant`s services (« Work Product »). .