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Q: CEOs and NDAs ( No Answer,   1 Comment )
Question  
Subject: CEOs and NDAs
Category: Business and Money
Asked by: leoj-ga
List Price: $10.00
Posted: 11 Aug 2005 23:21 PDT
Expires: 10 Sep 2005 23:21 PDT
Question ID: 554804
I am interested in getting confirmation in the form of a generally
reliable web source of a position I am espousing.  It could be
multiple sources tied together, but it needs to be clear that my
position is in fact correct.

I have espoused the understanding that while a NDA (non-disclosure
agreement) that employees sign when gaining employment is valid, the
CEO of the company could decide what is to be covered by that
agreement, essentially allowing him to disclose just about anything
publicly.  Further, that he can give a limited release to employees to
discuss specific matters if he so chooses.  For matters that related
to a specific person, such as in the case for why an employee was fired,
if the person involved gave permission, he could disclose such information.

Essentially, for general matters, the position is that a CEO is able
to decide what information is and isn't to be covered and thus in effect
is not constrained by the employee confidentiality agreement or NDA.

You can assume that the CEO in this case has complete control of the
board of directors and it is a private, closely held company.

I am not referring to NDAs between two companies, since that would
clearly be a different case.

A tip will be given if the reference material is convincing enough to
sway the audience of the discussion.
Answer  
There is no answer at this time.

Comments  
Subject: Re: CEOs and NDAs
From: sharpshooter22-ga on 12 Aug 2005 17:10 PDT
 
I don't have a website for you, but thought I'd share my thoughts.
First, this is simply a matter of contract law.  Your position depends
on the terms of the NDA.  I.e., are the non-disclosure provisions
mutual or is only the employee making the promise not to disclose?  If
it is mutual, then I would contend that the other signatory, the
company and therefore the CEO is bound by the terms of the NDA and the
employee would be able to enforce the agreement.  If, on the other
hand, the NDA solely protects the company from unwanted disclosures,
then you are right since only the company (in this instance the same
as the CEO, provided no fiduciary duties to minority interests are
being violated) has an enforceable promise.  The company can release
an employee, either partially or fully, from his or her contractual
obligation under the NDA.  But note that the non-mutual NDA must have
some, if even nominal, consideration to be enforceable (although this
could be, and probably is, the employment opportunity).

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