Are NDA's required with a Government Agency?

[OuterSpace]

My company is in the proposal phase for software deliverable to the NRO. We are asking the Air Force for help on this project by lending us some of their software, which we will integrate into ours for the deliverable to the NRO. The Air Force is asking to see our proposal that we are submitting to the NRO so they can see how we need to use their code so they can help us with the development of the integrated deliverable. My question is, does my company need an NDA in place with the Air Force before we share this proprietary information? Or is an NDA not needed (or even possible), because they are a government agency? 

Thank you

 

[formerfed]

I can’t tell you an exact answer at this point.  But I can say NDAs are often used in similar situations by many companies.  Companies know that not everybody on the government side are government employees, transition of employment between government and the private sector is common, and inadvertent releases happen.  If nothing else, signing an NDA makes recipients more conscious of the need to protect data. 

[Retreadfed]

23 hours ago, OuterSpace said:

My question is, does my company need an NDA in place with the Air Force before we share this proprietary information?

What type of disclosure are you worried about?  The Air Force may not be able to release some or all of your proposal  because of 18 U.S.C. 1905.  On the other hand, it may be required to release it under FOIA or if required pursuant to legal process such as a subpoena.  Also, don't forget a demand for the proposal from congress.

[formerfed]

46 minutes ago, Retreadfed said:

The Air Force may not be able to release some or all of your proposal  because of 18 U.S.C. 1905.  On the other hand, it may be required to release it under FOIA or if required pursuant to legal process such as a subpoena.  Also, don't forget a demand for the proposal from congress.

You missed the issue.  The OP is preparing a proposal for NRO.  The AF wants to see the NRO proposal

[Jacques]

On 6/1/2023 at 11:10 AM, OuterSpace said:

My question is, does my company need an NDA in place with the Air Force before we share this proprietary information? Or is an NDA not needed (or even possible), because they are a government agency?

Whether your company "needs" an NDA (or something similar) depends on whether you want to protect the information you share with the Air Force.  While generally a matter of state law, most laws providing a remedy for misappropriation of trade secrets require that the company claiming it is a trade secret take extensive measures to protect from disclosure what the company claims is a trade secret.  

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Generally, trade secret protection is given to concrete information, that is maintained in secrecy by the owner, which has economic value from not being generally known or readily discernible by others who can profit from its disclosure.

NASH & RAWICZ, INTELLECTUAL PROPERTY IN GOVERNMENT CONTRACTS (6TH ED. 2008), at 157.  The requirement that the owner maintain the secrecy of the putative trade secret also appears in the second half of the definition of a trade secret in the Uniform Trade Secrets Act at § 1(4):

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“Trade secret” means information, including a formula, pattern, compilation, program, device, method, technique, or process that: (1) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (2) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

Nash & Rawicz note further:

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The trade secret owner must assert reasonable efforts under the circumstances to maintain the secrecy of the trade secret.  These efforts need not be extreme or unduly costly measures but should include reasonable measures that prevent access to the trade secret without authorization, such as, controlling access to the plant, limiting access to the trade secret on a need to know basis, monitoring of publications, advising employees of the existence of the trade secrets, use of confidentiality and non-disclosure agreements, restrictive legends on drawings, employee exit interviews, noncompete agreements with employees, etc.

Nash & Rawicz, at 163. Outside the context of the Federal government, absent an express promise of confidentiality, under the Restatement (Third) Unfair Competition § 41(b), a duty of confidence can arise if at the time of the disclosure,

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(1) the person knew or had reason to know that the disclosure was intended to be in confidence, and (2) the other party to the disclosure was reasonable in inferring that the person consented to an obligation of confidentiality.

Because of the Freedom of Information Act, and limitations on the ability of most Government employees to bind the Government, an inferred promise of confidentiality that binds the Government is unlikely to arise on your facts.

If you believe that what you are sharing with the Air Force qualifies as a trade secret, and you want it to remain a trade secret (for instance, vis-a-vis third parties) after sharing it with the Air Force, it seems to me you would want some assurances from the Air Force that it will treat the putative trade secret consistently with it being a trade secret.  (Sorry if all of this is obvious.)

[Retreadfed]

1 hour ago, formerfed said:

You missed the issue.  The OP is preparing a proposal for NRO.  The AF wants to see the NRO proposal

I was fully aware of this when I made my post and I stand by it.

[formerfed]

The OP wasn’t specific.  The post used the term “see our proposal” so that might mean nothing is submitted.  Plus the question is “does my company need an NDA in place with the Air Force before we share this proprietary information?”  If a NDA gets generated, that should take care of trade secrets and proprietary info.  I know an NDA isn’t needed for the government normally.  But NRO, like many agencies, is highly dependent upon contractors for IT and subject matter expertise.  The NDA covers contractors clearly as well as government employees who might leave the project.  Maybe it’s not even needed but it makes individuals more conscious.

[joel hoffman]

Why don’t you ask the NRO, too?

I just realized that my brother was assigned to an NRO installation, while in the Air Force  back in late 60’s, early seventies timeframe. 

[formerfed]

36 minutes ago, joel hoffman said:

Why don’t you ask the NRO, too?

I just realized that my brother was assigned to an NRO installation, while in the Air Force  back in late 60’s, early seventies timeframe

Yes, definitely ask NRO.  I forgot to include that

[Retreadfed]

20 hours ago, formerfed said:

If a NDA gets generated, that should take care of trade secrets and proprietary info.

Not necessarily.  With qui tam bounty hunters on the loose today, there is no guarantee that the information will not be released if a false claim qui tam action is initiated.