NDA still valid after company change?

Asked almost 2 years ago - Decatur, IL

If I signed an NDA in March of 2007 - for a company that was a partnership - called themselves an LLC but I do not believe they were ever really an LLC. In August of 2008 it became a sole proprietorship and in November 2008 the company name changed all together. Is that original NDA I signed in March of 2007 with the original company name listed as an LLC still valid for the new sole proprietorship with a new name in November 2008?

Also the original NDA refers to us as employee's - yet we were never under any of the company names paid as employee's - only independent contractors - though I honestly do believe that at least I was misclassified from then - Nov 2012 when I gave notice I was quitting. She even put my cell phone on her acct. I was regarded as mgt in am email in 8/08.

Additional information

i have read the NDA multiple times over (it is only 1 page) - there is no assignability clause.

Attorney answers (3)

  1. Bruce E. Burdick

    Pro

    Contributor Level 20

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    Answered . You are still bound by the NDA, but the question is to who. Who, is the successor to the LLC, if there is an assignability clause, which is routinely present ["this agreement shall be binding on the heirs, successors and assigns of the parties" - or something similar]. If yes, then the sole proprietor can simply assign it from the LLC or partnership to his sole proprietorship [i.e. to himself] in order to enforce it. Whether you were an employee or independent contractor will not change the outcome if there is an NDA you signed. More likely determinative in Illinois is whether the employee had the right to assign you additional work, what benefits were paid, how taxes were reported, etc. Before you presume invalidity of the NDA and proceed to violate it, better see a lawyer as otherwise that could really backfire on you.

    I am not your lawyer and you are not my client. Free advice here is without recourse and any reliance thereupon is... more
  2. Pamela Koslyn

    Contributor Level 20

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    Answered . The thing to look for in the NDA is an assignment clause. If there is one, and the assignor (them) doesn't need to give you notice in advance, then they can assign their rights to the NDA.

    Your best bet is to hire a lawyer to look up the company to see what business form it actually had, to review your NDA, and to discuss your possible defenses to it.

    Avvo doesn't pay us for these responses, and I'm not your lawyer just because I answer this question or respond to... more
  3. Mazyar Malek Hedayat

    Contributor Level 13

    Answered . Your ask if an NDA is still effective following a series of company changes. Based on what you have written I would say "Most Likely Not." I say that because you have not indicated if the NDA included a "reasonable scope," a "reasonable geographic area," or was for a "reasonable period of time." All of these somewhat nebulous standards must be met in order for a Non-Disclosure or Non-Compete agreement to be effective in Illinois.

    I would recommend that you progress beyond this forum and find an Attorney familiar with such documents that can take a look at the actual language in conjunction with a detailed breakdown of the history of this matter. Only that Attorney will be able to give you a credible answer; but he or she should concentrate in business matters.

    I hope this information has been helpful. Feel free to contact our office to discuss this matter in greater detail.

Related Topics

Sole proprietorship small business

A sole proprietorship is a business owned and operated by one person in which there is no legal distinction between the business and owner.

NDAs for business

An NDA (non-disclosure agreement) is a contract between two or more parties in which the parties agree not to disclose certain information.

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