Nondisclosure agreements—also known as NDAs or confidentiality agreements—are legally enforceable contracts that obligate the parties to the agreement to keep information shared in the course of the parties’ relationship confidential—and not to use it for any other purpose or disclose it to any other person or entity not authorized to receive the information. Nondisclosure agreements are used in a variety of business, employment, and work relationships, including between employers and employees and companies and independent contractors.

Nondisclosure agreements typically include a definition of what constitutes confidential information under the agreement and may be limited to a period of time—usually a number of years—in which confidential information shared between the parties cannot be used or disclosed. Nondisclosure agreements also usually include a provision stating that one or both parties agree that if one party violates the agreement the other party would not have an adequate remedy at law—meaning money damages awarded by a judge or jury would not adequately compensate the party whose confidential information was disclosed—and a court may enter an injunction ordering the party who improperly disclosed the confidential information not to do so again, or face additional penalties (civil and criminal contempt of court) for violating the court’s order.

Because nondisclosure agreements are contracts they are generally governed by state contract law, and which state’s law applies is determined by whether the parties agreed to the applicable law in the NDA (a choice-of-law provision), where the parties are located, or where property or places important to the relationship are located—such as real estate, personal property, intellectual property, corporate headquarters, or place of work—or other relevant facts and circumstances.

In Pennsylvania (PA), nondisclosure agreements (NDAs), also known as confidentiality agreements, are recognized and enforceable under state contract law. These agreements are commonly used in business and employment contexts to protect the confidentiality of certain information shared between parties, such as employers and employees or companies and independent contractors. An NDA in PA typically defines what is considered confidential information and sets a time frame for how long the information must be kept confidential. It may also include a provision for injunctive relief, allowing a court to issue an order to prevent further disclosure and impose penalties for non-compliance. The enforceability of an NDA in PA depends on standard contract principles, including offer, acceptance, consideration, and the intention to create a legal relationship. The specific terms of the NDA, such as the choice-of-law provision, can dictate which state's law will govern the agreement. If there is no such provision, the law of the state with the most significant relationship to the agreement or the parties involved will typically apply.