Understanding NDA Limitations
Non-disclosure agreements are powerful legal tools, but they are not magic contracts that can accomplish anything. Understanding what NDAs can realistically achieve - and what they cannot - is essential for anyone considering using one in a personal relationship context.
This guide provides an honest assessment of the legal limitations, enforcement challenges, and common misconceptions surrounding relationship NDAs. Being realistic about these limitations will help you make informed decisions and set appropriate expectations.
What Relationship NDAs CAN Do
When properly drafted and executed, relationship NDAs can accomplish several important objectives:
Create Legal Consequences for Disclosure
A valid NDA creates a contractual obligation. If someone breaches that obligation by disclosing protected information, you have legal remedies including:
- Monetary Damages: Compensation for actual harm caused by the disclosure
- Liquidated Damages: Pre-agreed amounts specified in the contract (if reasonable)
- Injunctive Relief: Court orders to stop ongoing or imminent disclosures
- Attorney's Fees: Recovery of legal costs if provided for in the agreement
Serve as a Deterrent
Often the most valuable function of an NDA is deterrence. Knowing that legal consequences exist makes most people think twice before disclosing confidential information. The psychological effect of having signed a formal legal document should not be underestimated.
Establish Clear Expectations
An NDA forces both parties to explicitly discuss and agree upon what information is confidential. This clarity prevents misunderstandings and establishes a shared understanding of privacy expectations from the beginning of a relationship.
Provide Evidence of Intent
If disputes arise, an NDA provides clear evidence that both parties understood and agreed that certain information was meant to be confidential. This can be valuable in court proceedings or even in informal disputes.
What Relationship NDAs CANNOT Do
No matter how well-drafted, there are fundamental limitations on what any NDA can accomplish:
Prevent Disclosure of Already-Public Information
Once information is public, it cannot be made confidential again. If photos have already been posted, if stories have already been told, or if information is already widely known, an NDA cannot "un-ring that bell."
Override Criminal Reporting Obligations
An NDA cannot prevent someone from:
- Reporting crimes to law enforcement
- Cooperating with criminal investigations
- Testifying truthfully when subpoenaed
- Filing complaints with government agencies
Legal Principle: Illegality Exception
Contracts cannot be used to conceal illegal activity. Any provision that attempts to prevent reporting of criminal conduct is void and unenforceable as against public policy.
Create or Substitute for Consent
An NDA documents confidentiality expectations - it does not and cannot:
- Create consent for any activity
- Prevent someone from withdrawing consent
- Serve as evidence that activities were consensual
- Prevent claims of assault, abuse, or harassment
Guarantee No Disclosure Will Occur
An NDA creates legal consequences for breach, but it cannot physically prevent someone from talking. A determined person may disclose information regardless of legal consequences, especially if they:
- Lack assets that could satisfy a judgment
- Believe the disclosure is worth the risk
- Are motivated by anger, revenge, or other emotions
- Live in a jurisdiction where enforcement is difficult
Control Third-Party Actions
An NDA only binds the parties who sign it. It cannot prevent:
- Paparazzi from photographing you in public
- Media outlets from publishing stories based on other sources
- Friends or family who weren't party to the agreement from talking
- Public records from being accessed
Quick Reference: Can vs. Cannot
NDAs CAN
- Create legal liability for breaches
- Establish clear privacy expectations
- Serve as a deterrent against disclosure
- Provide basis for injunctive relief
- Enable recovery of monetary damages
- Document what information is confidential
- Include reasonable liquidated damages
- Survive the end of a relationship
- Be enforced across state lines (usually)
NDAs CANNOT
- Prevent reporting of crimes
- Create or substitute for consent
- Make public information private again
- Prevent truthful testimony under subpoena
- Bind people who didn't sign them
- Guarantee no disclosure will occur
- Include unconscionable penalties
- Cover up abuse or harassment
- Stop determined bad actors
Common Myths and Misconceptions
"If they signed the NDA, they can never talk about anything that happened."
RealityNDAs have limitations. They cannot prevent someone from discussing matters of legitimate public concern, reporting illegal conduct, seeking medical or mental health treatment, or testifying truthfully in legal proceedings. Additionally, information that becomes public through other means is no longer protected.
"A $1 million liquidated damages clause will definitely scare them into silence."
RealityCourts will not enforce liquidated damages clauses that are deemed penalties rather than reasonable estimates of anticipated harm. Excessive amounts may be reduced by a court or invalidated entirely. Moreover, a large damages clause is meaningless if the person who breaches has no assets.
"This NDA will prevent them from ever claiming our relationship was non-consensual."
RealityAn NDA cannot affect consent claims. Courts have consistently held that NDAs cannot be used to prevent reporting of sexual assault, abuse, or harassment. Many states have laws explicitly voiding NDA provisions that attempt to do this. This is both a legal and ethical bright line.
"Once they sign, I'm fully protected forever."
RealityNDAs create legal remedies, not perfect protection. Someone can still breach despite legal consequences. Enforcement requires time, money, and willingness to pursue litigation. Some people will violate agreements regardless of consequences, especially if motivated by strong emotions or if they believe they have nothing to lose.
"If they talk to a journalist, I can automatically sue for the full amount."
RealityEnforcing an NDA requires proving a breach occurred, that the information disclosed was covered by the agreement, and demonstrating damages (unless valid liquidated damages apply). Even then, the person must have assets to satisfy a judgment, and collection can be challenging.
Factors Affecting Enforceability
Courts consider numerous factors when determining whether to enforce relationship NDA provisions:
Factors That Support Enforceability
- Mutual Consideration: Both parties receive something of value (mutual promises)
- Voluntary Agreement: Both parties signed freely without duress or coercion
- Reasonable Scope: The protected information is clearly defined and reasonable
- Legitimate Purpose: Protecting genuinely private information, not covering up wrongdoing
- Reasonable Damages: Liquidated damages that reflect actual anticipated harm
- Independent Legal Advice: Both parties had opportunity to consult attorneys
Factors That Undermine Enforceability
- Duress or Coercion: Signing under pressure, threats, or without adequate time to review
- Unconscionability: Terms that "shock the conscience" or are grossly unfair
- Covering Illegal Activity: Any attempt to conceal crimes or prevent reporting
- Penalty Clauses: Damages designed to punish rather than compensate
- Overbroad Scope: Attempting to cover information that cannot be made confidential
- Power Imbalance: Extreme inequality in bargaining positions without safeguards
Important State Variations
NDA enforceability varies significantly by state. Some key variations include:
| Issue | Variation Examples |
|---|---|
| Sexual Harassment NDAs | California, New York, New Jersey, and other states restrict NDAs that prevent disclosure of sexual harassment claims |
| Non-Disparagement Clauses | Some states limit enforcement of non-disparagement provisions in consumer and employment contexts |
| Liquidated Damages | Standards for what constitutes an unenforceable "penalty" vary; some states are stricter than others |
| Revenge Porn Laws | Most states now have criminal statutes; NDA provisions may be supplemented by or conflict with these laws |
| Consideration Requirements | Some states require independent consideration for NDAs signed during ongoing relationships |
Practical Recommendations
Before Signing or Requesting an NDA
- Be Realistic: Understand that an NDA is a tool, not a guarantee
- Consult an Attorney: Especially for high-stakes situations or significant assets
- Consider Both Perspectives: Will this be enforceable if you need to rely on it?
- Document Properly: Ensure proper execution with signatures and dates
- Keep Copies: Maintain secure copies of all signed agreements
For Maximum Effectiveness
- Use clear, specific language about what information is protected
- Include reasonable (not punitive) liquidated damages
- Ensure both parties have time to review and consider the agreement
- Include explicit carve-outs for legally required disclosures
- Specify the governing law and dispute resolution procedures
- Consider whether the NDA should be mutual or one-sided
If You're Concerned About Enforcement
If you're in a situation where you're worried about NDA violations, consider:
- Consulting with a litigation attorney about your options
- Whether the potential violator has assets to satisfy a judgment
- The public relations implications of enforcement proceedings
- Alternative dispute resolution options like mediation
- Whether cease-and-desist communications might be effective