Utah Law Explained — What Small-Business Owners in Utah Should Know About Non-Disclosure Agreements

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What Small-Business Owners in Utah Should Know About Non-Disclosure Agreements

Plain English guide to what NDAs are, when they are enforceable in Utah, and what to include so your confidential info stays protected

Non-disclosure agreements are a simple way to protect sensitive information, client data, and trade secrets. Whether you are pitching a product to an investor or onboarding a contractor, a clear NDA helps prevent misuse and builds trust. This guide explains how NDAs work in Utah, when they are enforceable, what to include, and pitfalls to avoid.

What an NDA Is and Common Utah Use Cases

An NDA is a contract that prevents one party from revealing confidential information shared during a business relationship. Utah small businesses use NDAs when hiring employees who access internal data, working with vendors or independent contractors, and discussing business ideas with investors or partners.

With an NDA in place, you have clear rules for handling information and legal grounds to act if someone leaks or misuses what you shared.

When NDAs Are Enforceable Under Utah Law

Utah courts enforce NDAs that are reasonable, clear, and specific. Overly broad language that tries to cover information that is not confidential can be struck down.

The Utah Uniform Trade Secrets Act helps define protected information. See Utah Code § 13-24-2 for key definitions and remedies tied to trade secrets.

The information must not be public or easily discoverable.
The agreement should define what confidential means.
The duration should be reasonable for the type of information, often 1 to 5 years.

Key Terms Every Utah NDA Should Include

confidential_definition Spell out what is protected, such as formulas, code, pricing, customer lists, and marketing plans.

exclusions Information that is public, already known without restriction, or independently developed is not covered.

duration Define how long confidentiality lasts. Many Utah NDAs use 1 to 3 years. Trade secrets can be protected indefinitely.

obligations State how each party must handle the information, including storage, access, and return or destruction on request.

remedies Allow for injunctive relief and damages if the agreement is breached, consistent with Utah law.

governing_law Specify Utah law and a Utah forum for disputes.

Clear definitions and realistic limits make an NDA more likely to hold up in court.

One-way vs Mutual NDAs

One-way NDAs fit when only your business shares information. Mutual NDAs fit when both sides plan to share. Choose the right structure for the situation. Using the wrong version can add risk and confusion.

How NDAs Work With Trade Secret Protection

Utah’s Uniform Trade Secrets Act provides extra protection for proprietary business data. Even without an NDA, a company can sue if it proves the information is a trade secret. An NDA strengthens your position by showing you took reasonable steps to keep information confidential.

When NDAs Can Be Invalid or Overly Broad

Restricting general knowledge or skills a worker can use elsewhere.
Having no clear time limit or using vague language.
Trying to cover information that is already public.

Keep your NDA focused on real business interests. Do not use it to block fair competition or employment mobility.

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Need Help Applying This to Your Situation?

A solid NDA provides peace of mind and a clear path to remedies if misuse occurs. Tailor your terms to the info you share and the partners you trust.

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