Non-Disclosure Exceptions: Prior Access
NDA
Table of Contents:
Without Restriction
Right to Receive
Non-Disclosure Exceptions: Prior Access
An important exception to the non-disclosure/non-use obligations in an NDA covers information that the receiving party already or previously had access to or possession of (aka the “prior access” exception). However, this exception may (and should) be limited by certain caveats, including the following:
Without Restriction
The following exemplar exempts prior-access information from confidentiality obligations if the information was not subject to any confidentiality restrictions at the time of the prior disclosure:
Exemplar N18B-1
Information will not be deemed Confidential Information if it (i) was already available to, or in the possession of, Recipient, without any limitation of confidentiality owed to Discloser with respect to such information, prior to its disclosure by, or at the direction of, Discloser in connection with Recipient’s evaluation of a potential Investment, (ii) is or becomes available in the public domain on or after the date hereof (other than as a result of a disclosure by Recipient in violation of this agreement), (iii) is acquired by Recipient from a source, who is not known by Recipient to be in breach of an obligation of confidentiality to the Discloser, or (iv) was developed by Recipient without the use of the Confidential Information.
Right to Receive
The following exemplar requires the receiving party, in order to rely on the prior-access exception, to stipulate that it had the right to receive such information in the first place (see clause (iv) in the exemplar below):
Exemplar N18B-2
Confidential Information does not include information that: (i) is or becomes generally available to the public through no act or omission of the Recipient or any of its Representatives in violation of this Agreement; (ii) is disclosed to the Recipient or any of its Representatives by a third party that is not known to the Recipient or such Representative, as applicable, to be in violation of a contractual or other legal obligation of confidentiality to the Discloser by disclosing such information to the Recipient or such Representative, as applicable; (iii) is or was developed independently by the Recipient or any of its Representatives without use of the Discloser’s Confidential Information; or (iv) was in the Recipient’s or any of its Representatives’ possession prior to receipt from the Discloser pursuant hereto, provided that, to the knowledge of the Recipient or such Representative, as applicable, the source thereof was not in violation of a contractual or other legal obligation of confidentiality to the Discloser by disclosing such information to the Recipient or such Representative, as applicable.
Finally, as a procedural safeguard to protect against irreparable loss of confidentiality, the following exemplar offers language that requires the receiving party to give the information owner advance notice of any disclosure taken in reliance of the prior-access exemption so that the owner can take appropriate action to forestall such disclosure if it disagrees that the exception applies:
Exemplar N18B-3
Unless and until the Confidential Information (i) is in or becomes part of the public domain other than by reason of disclosure by either party or either party’s Employees in violation of this Agreement, (ii) was known by one party previously without a duty of confidentiality to the other party or (iii) is rightfully obtained from third parties not under any duty of confidentiality, such Confidential Information shall be subject to the provisions hereof. However, even if a party shall obtain the Confidential Information in the manner described in Clauses (ii) or (iii) above, it shall not further disclose the Confidential Information beyond the extent of disclosure that exists prior to the date hereof or otherwise without giving the other party seven (7) days prior written notice of its intention to make such disclosures on the basis of Clauses (ii) or (iii).