Businesses often have proprietary information, such as trade secrets, marketing information, and client lists, that is not readily available to the public. Working for a business often exposes an employee to confidential information to which a non-employee would not have access. To protect information that is crucial to the continued success of a business, the employer may require that some or all employees sign a confidentiality agreement, particularly if they are managerial or professional employees. These agreements typically prohibit an employee from disclosing the employer’s confidential information to another individual or to the public in general. The goal of a confidentiality agreement is to prevent the employee from leaving his or her position and launching or working for a competing business using the employer’s confidential information, which arguably could give him or her an unfair advantage. When this situation occurs, a dispute often erupts in which the employer accuses the employee of breaching the confidentiality agreement.
Under Arizona law, trade secrets are a legitimate protectible interest that an employer is free to include in a confidentiality agreement signed by an employee. Likewise, if customer information is truly confidential and inaccessible to the public, then an employer could address it in a confidentiality agreement. So long as the restrictions in the agreement are not overbroad or unreasonable, a court is likely to enforce a confidentiality agreement. This means that if there is a breach of a legally valid confidentiality agreement by an employee, the business could have a claim under the Arizona Uniform Trade Secrets Act, as well as other claims, including breach of contract, breach of the covenant of good faith and fair dealing, breach of the duty of loyalty, tortious interference, and unfair competition.
If you have questions about your rights and responsibilities with confidentiality agreements, or how to deal with a potential breach of this type of agreement, you will greatly benefit from calling us today and getting the advice that you need. Williams Commercial Law Group, L.L.P., has the experience and knowledge to handle your case the right way. Contact Williams Commercial Law Group, L.L.P., today at (602) 256-9400.