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North Dakota Non-Disclosure Agreement Requirements

In Osborne v.

Introduction

In Osborne v. Brown & Saenger (2017), the North Dakota Supreme Court refused to let an out-of-state choice-of-law and forum-selection clause be used to evade the state's restraint-of-trade ban, voiding both the forum clause and the underlying non-compete, a sign of how seriously North Dakota courts enforce it. That ban, Century Code Section 9-08-06, traces to the Dakota Territory's 1865 adoption of the Field Civil Code, the same code text California adopted seven years later in 1872, so North Dakota's version predates both statehood in 1889 and California's own codification of the same language. A North Dakota Non-Disclosure Agreement is an ordinary, enforceable confidentiality contract, mutual or one-way, in which the parties agree to keep specified information secret, but an NDA whose confidentiality definition functions as a disguised non-compete risks being voided under that same statute. The North Dakota Supreme Court has described Section 9-08-06 as one of the oldest and most continuous applications of public policy in contract law in the state, and unlike Montana, which enforces a nearly identically worded statute under a common-law reasonableness test, North Dakota reads its version as a near-total ban, one of only three states to do so, alongside California and Oklahoma. Trade secrets exchanged under an NDA are separately protected by the North Dakota Uniform Trade Secrets Act (Century Code Sections 47-25.1-01 through 47-25.1-08), and a misappropriation claim generally must be filed within three years of when the misappropriation was discovered or reasonably should have been discovered. North Dakota has no statute carving an employee's own-time inventions out of an assignment clause, unlike California, Delaware, Illinois, Kansas, Minnesota, North Carolina, Utah, and Washington, so invention ownership in a North Dakota employment relationship runs on common law and whatever the agreement itself says. The practical effect for drafting is that a North Dakota NDA's confidentiality definition needs to stay tightly tied to genuine trade secrets and sensitive information, since a clause broad enough to functionally stop someone from working in their field is exactly the kind of restraint Section 9-08-06 voids.

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Key Things to Know

  1. 1

    That ban runs through the scope of a confidentiality clause, not the existence of the NDA itself. An NDA that protects genuine trade secrets and sensitive information, without reaching into what someone can do for a living afterward, generally is not the kind of restraint Section 9-08-06 targets. The statute has two narrow exceptions: sale of a business's goodwill, and partnership, LLC, or corporate dissociation or dissolution.

  2. 2

    North Dakota Century Code Section 9-08-06, which voids a contract restraining a lawful profession, trade, or business, traces to the Dakota Territory's 1865 adoption of the Field Civil Code, predating North Dakota statehood by twenty-four years. North Dakota courts apply it as a near-total, categorical ban on non-competes, one of only three states, along with California and Oklahoma, to read this shared Field Code language that strictly.

  3. 3

    In Osborne v. Brown & Saenger, Inc. (2017 ND 288), the North Dakota Supreme Court voided a two-year, one-hundred-mile non-compete and refused to enforce a choice-of-law and forum-selection clause that would have applied South Dakota law instead, holding that a party cannot contract around North Dakota's public policy against non-competes by selecting another state's law or court.

  4. 4

    Trade secret protection runs through the North Dakota Uniform Trade Secrets Act (Century Code Sections 47-25.1-01 through 47-25.1-08), separate from whatever the NDA itself says.

  5. 5

    A trade secret misappropriation claim in North Dakota generally must be filed within three years of when the misappropriation was discovered or reasonably should have been discovered, and a continuing misappropriation counts as a single claim rather than a new one each time (Century Code Section 47-25.1-06).

  6. 6

    North Dakota has no statute requiring an employer to carve an employee's own-time, own-resources inventions out of an assignment clause, unlike California, Delaware, Illinois, Kansas, Minnesota, North Carolina, Utah, and Washington. Invention ownership in a North Dakota employment relationship runs on common law and whatever the agreement itself says.

  7. 7

    Mutual NDAs, where both sides share confidential information, and one-way NDAs, where only one side does, are both ordinary enforceable contracts in North Dakota; which one fits depends on whether the exchange runs both directions, like a partnership or acquisition discussion, or one direction, like pitching an investor.

  8. 8

    A North Dakota court can order injunctive relief to stop an ongoing or threatened misappropriation of a trade secret, in addition to damages, and the injunction lasts only as long as the trade secret advantage itself does (Century Code Section 47-25.1-02).

Key decisions before you file

Before you file a Non-Disclosure Agreement in North Dakota, a few decisions shape the document: which option to choose and what each one means. The Non-Disclosure Agreement guide walks through them.

Open the Non-Disclosure Agreement guide

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NORTH DAKOTA NON-DISCLOSURE AGREEMENT

[Party A Name], of [City], North Dakota, and [Party B Name], of [City], North Dakota (together the "Parties," each a "Party"), sign this Non-Disclosure Agreement effective as of the date below.

  1. Purpose. The Parties are considering [describe business purpose, e.g. a joint venture, acquisition, or vendor relationship], and this Agreement sets the ground rules for any Confidential Information exchanged while they explore it.

  2. Definition of Confidential Information. Confidential Information means technical, business, financial, or strategic information a Party discloses that is marked confidential or that the circumstances make clear should be treated that way, including any trade secret meeting the North Dakota Uniform Trade Secrets Act's definition: information with independent economic value from not being generally known and kept secret through reasonable efforts (Century Code Section 47-25.1-01(4)). Excluded regardless of how shared: information the receiving Party already possessed, worked out independently, or received from a third party owing no duty of confidence, and information that becomes public through no fault of the receiving Party.

  3. Obligations. The receiving Party will hold Confidential Information in confidence, use it solely for the Section 1 purpose, and protect it with care at least equal to what it uses for its own comparable information, sharing it only with representatives who genuinely need it and who are themselves bound to protect it on terms no weaker than these.

  4. Scope Limitation (North Dakota-Specific). North Dakota Century Code Section 9-08-06 voids, with no reasonableness inquiry, a contract term restraining someone from practicing a lawful profession, trade, or business, a prohibition the North Dakota Supreme Court has called one of the oldest and most continuous applications of public policy in the state's contract law. In Osborne v. Brown & Saenger, Inc., 2017 ND 288, the court struck down a two-year, hundred-mile non-compete and refused to let a South Dakota choice-of-law and forum clause shield it. North Dakota is one of only three states, with California and Oklahoma, that reads this language as a near-total ban rather than a reasonableness test, so this Agreement's confidentiality obligations reach only the trade secrets and proprietary information in Section 2, with no restriction on the receiving Party's future work beyond the statute's own narrow exceptions for a sale of business goodwill or partner or member dissociation.

  5. Federal Whistleblower Notice. Under 18 U.S.C. Section 1833(b) of the Defend Trade Secrets Act, disclosing a trade secret in confidence to a government official or attorney solely to report a suspected legal violation, or including one in a sealed court filing, carries no criminal or civil liability. North Dakota's own trade secret statute does not require this notice, but federal law ties full access to the Act's exemplary-damages and fee-shifting remedies to including it here.

  6. Term. Confidentiality duties run [X years] from signing, though information that continues to meet North Dakota's trade secret definition stays protected for as long as it retains that status, independent of this Agreement's stated term.

  7. Return or Destruction. Within a reasonable time after the disclosing Party's written request, or once the Section 1 purpose concludes, the receiving Party must return or destroy all Confidential Information and confirm destruction in writing, at the disclosing Party's election.

  8. Remedies. Because a breach here could cause harm money alone would not fix, Century Code Section 32-05-04 lets a court grant a final injunction against the breaching Party, on top of damages. If the information is also a trade secret, the North Dakota Uniform Trade Secrets Act separately authorizes an injunction (Section 47-25.1-02), actual-loss and unjust-enrichment damages with up to double that as exemplary damages for willful and malicious conduct, and attorney's fees for bad-faith or willful conduct (Sections 47-25.1-03, 47-25.1-04).

  9. Governing Law. North Dakota once had a default rule assigning a silent contract to the law of its place of performance, but the legislature repealed that provision, former Century Code Section 9-07-11, in 1973, leaving no such default today. This Agreement is instead governed by North Dakota law by its own terms, and consistent with the Osborne holding discussed above, the Parties may not pick another state's law or forum under Section 28-04.1-03 to enforce a restriction North Dakota's non-compete policy would otherwise void.

  10. Miscellaneous. An electronic signature carries the same effect as a handwritten one under North Dakota's Electronic Transactions chapter (Century Code Section 9-16-01 et seq.) and the federal ESIGN Act (15 U.S.C. Section 7001). If this Agreement is later found to have more than one object and one is unlawful, Century Code Section 9-04-04 voids only that object and leaves the rest standing. The Parties' mutual promises are themselves the consideration Century Code Section 9-05-01 requires.

[Party A Signature] ____________________ Date: __________ [Party B Signature] ____________________ Date: __________

North Dakota Requirements for Non-Disclosure Agreement

Definition of Confidential Information (North Dakota Century Code Section 47-25.1-01)

Clearly defines what constitutes confidential information under North Dakota law, including the trade secret and misappropriation definitions in the North Dakota Uniform Trade Secrets Act.

Trade Secret Protection (North Dakota Century Code Section 47-25.1-02)

Authorizes a court to enjoin actual or threatened misappropriation of a trade secret under the North Dakota Uniform Trade Secrets Act, terminating once the trade secret ceases to exist.

Defend Trade Secrets Act Compliance (18 U.S.C. Section 1836)

Incorporates the federal Defend Trade Secrets Act's civil cause of action, which provides additional remedies for misappropriation of trade secrets.

Economic Espionage Act Considerations (18 U.S.C. Sections 1831 through 1839)

Acknowledges federal protections against economic espionage and theft of trade secrets, including criminal penalties.

Non-Compete and Restrictive Covenant Limitations (North Dakota Century Code Section 9-08-06)

North Dakota Century Code Section 9-08-06 voids, without a reasonableness inquiry, a contract term restraining a person from exercising a lawful profession, trade, or business, subject only to narrow exceptions for the sale of a business's goodwill and for partner or member dissociation. North Dakota Supreme Court decisions, including Osborne v. Brown & Saenger, Inc. (2017 ND 288), read this as a near-total ban rather than a reasonableness test, one of only three states, with California and Oklahoma, to do so, ensuring the NDA's confidentiality definition does not function as a disguised restriction on future employment.

Remedies for Breach (North Dakota Century Code Section 32-05-04)

Specifies the injunctive remedy available for breach: North Dakota's Preventive Relief chapter permits a court to grant a final injunction when pecuniary compensation would not afford adequate relief, when the amount of adequate compensation would be extremely difficult to ascertain, to prevent a multiplicity of proceedings, or when the obligation arises from a trust. This chapter addresses injunctive relief only; ordinary contract damages for breach arise from separate North Dakota contract-law principles, not this chapter.

Governing Law and Jurisdiction (North Dakota Century Code Section 28-04.1-03)

Section 28-04.1-03 governs whether a court will enforce an agreement to litigate a North Dakota controversy in another state's forum under that state's law; it is the same provision the North Dakota Supreme Court applied in Osborne v. Brown & Saenger, Inc. (2017 ND 288) to refuse enforcement of an out-of-state choice-of-law and forum-selection clause that would have let a party evade North Dakota's non-compete ban. It governs enforceability of forum-selection and choice-of-law agreements rather than supplying a default choice-of-law rule for a silent contract.

Electronic Signatures Compliance (North Dakota Century Code Section 9-16-01 and 15 U.S.C. Section 7001)

Ensures the NDA complies with both North Dakota's Electronic Transactions chapter (its version of the Uniform Electronic Transactions Act) and the federal ESIGN Act regarding electronic signatures and records.

Severability Provision (North Dakota Century Code Section 9-04-04)

Ensures that if this Agreement is found to have several distinct objects and one is unlawful in whole or in part, the contract is void only as to that object and valid as to the rest, allowing the remainder of the NDA to stand even if a single provision is found unenforceable.

Disclosure Required by Law (North Dakota Rule of Civil Procedure 45)

Addresses circumstances where disclosure of Confidential Information may be compelled by a subpoena under North Dakota's civil procedure rules, such as in response to a court order or discovery request in litigation.

Non-Solicitation Provisions (North Dakota Century Code Section 9-08-06)

North Dakota courts treat non-solicitation restraints the same as non-compete restraints under Section 9-08-06; Osborne v. Brown & Saenger, Inc. (2017 ND 288) itself voided a combined non-compete and non-solicitation clause under this statute, so any non-solicitation term in the NDA is subject to the same near-total ban and its two narrow exceptions.

Statute of Limitations (North Dakota Century Code Section 28-01-16)

Specifies North Dakota's six-year limitations period for an action upon a contract, obligation, or liability, express or implied, applicable to a breach-of-contract claim over the NDA itself.

Consideration Clause (North Dakota Century Code Section 9-05-01)

Establishes valid consideration for the agreement, as required for contract enforceability under North Dakota's good-consideration statute.

Privacy Law Compliance (15 U.S.C. Section 6801, Gramm-Leach-Bliley Act, and 45 C.F.R. Section 160, HIPAA)

Addresses compliance with applicable federal privacy laws that may affect the handling of confidential information that includes personal or financial data, since North Dakota has no comprehensive state privacy statute of its own.

Assignment and Delegation (North Dakota Century Code Section 9-11-01)

Addresses whether rights and obligations under the NDA may be assigned or delegated to third parties, in accordance with North Dakota's transfer-of-obligation statute.

Entire Agreement Clause (North Dakota Century Code Section 9-07-04)

Establishes that the NDA constitutes the entire agreement between the parties, consistent with North Dakota's rule that the intention of a written contract is ascertained from the writing alone if possible.

Frequently Asked Questions

A Non-Disclosure Agreement in North Dakota is an ordinary contract in which one or both parties agree to keep specified information confidential. It can be mutual, where both sides share confidential information, or one-way, where only one side does. Trade secrets shared under the agreement are also separately protected by the North Dakota Uniform Trade Secrets Act (Century Code Sections 47-25.1-01 through 47-25.1-08) regardless of what the NDA itself says.

Generally no. North Dakota Century Code Section 9-08-06 voids a contract restraining a person from exercising a lawful profession, trade, or business, and North Dakota courts treat this as one of the strongest prohibitions on non-competes in the country. An NDA whose confidentiality definition is broad enough to functionally stop someone from working in their field can be voided the same way, subject only to narrow exceptions for the sale of a business's goodwill and for partnership, LLC, or corporate dissolution or dissociation.

North Dakota Century Code Section 9-08-06 traces to the Dakota Territory's 1865 adoption of the Field Civil Code, the same code text California later adopted in 1872, so North Dakota's version predates both statehood and California's own codification of the same language. The North Dakota Supreme Court has described the prohibition as one of the oldest and most continuous applications of public policy in contract law in the state. Unlike Montana, which enforces a nearly identical statute under a common-law reasonableness test, North Dakota reads its version as a near-total ban, one of only three states to do so, alongside California and Oklahoma.

In Osborne v. Brown & Saenger, Inc. (2017 ND 288), a North Dakota sales employee's contract required disputes to be governed by South Dakota law in a South Dakota court, an arrangement that would have let a court apply a more permissive non-compete framework. The North Dakota Supreme Court unanimously refused to enforce that choice-of-law and forum-selection clause and voided the underlying non-compete, holding that a party cannot contract around North Dakota's public policy against non-competes by selecting another state's law or forum. The same reasoning applies to a North Dakota NDA that tries to use an out-of-state governing-law clause to enforce a restriction Section 9-08-06 would otherwise void.

A trade secret misappropriation claim under the North Dakota Uniform Trade Secrets Act generally must be brought within three years after the misappropriation is discovered, or after it reasonably should have been discovered with reasonable diligence (Century Code Section 47-25.1-06). A continuing misappropriation counts as a single claim rather than restarting the clock each time. A separate breach-of-contract claim over the NDA itself follows North Dakota's ordinary written-contract limitations period.

North Dakota has no statute answering this the way California, Delaware, Illinois, Kansas, Minnesota, North Carolina, Utah, and Washington do. Without a North Dakota invention-assignment carve-out statute, whether an employee's own-time invention belongs to the employer depends on common-law principles, such as whether the employee was specifically hired to invent, and on the exact wording of the assignment clause in the NDA or employment agreement itself.

It depends on whether confidential information will flow in both directions or only one. A mutual NDA fits a two-way exchange, such as a merger, partnership, or joint-venture discussion where both sides disclose sensitive information. A one-way NDA fits a one-directional exchange, such as pitching a business plan to an investor who is not sharing anything confidential back. Both forms are equally enforceable in North Dakota; the choice is about which structure matches the actual relationship.

No. A North Dakota NDA is an ordinary contract, not a formal instrument like a will or power of attorney, so it does not require notarization or witnesses to be valid. It only needs the standard elements of a valid contract: an offer, acceptance, and consideration, along with signatures from the parties being bound.

The non-breaching party can seek injunctive relief to stop an ongoing or threatened disclosure, along with damages caused by the breach. If the disclosed information also qualifies as a trade secret, the North Dakota Uniform Trade Secrets Act provides an additional, independent basis for relief, including exemplary damages of up to twice the award for willful and malicious misappropriation and, in bad-faith cases, attorney's fees, separate from whatever remedies the NDA itself specifies.