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Confidential Information Basics

Founding Member of Moshes Law, P.C.
During his years of practice, Yuriy has concentrated in litigation and real estate transactions as his areas of expertise.

what is confidential information

For almost as long as businesses have been competing with one another, the need for Confidentiality Agreements, Non-Disclosure Agreements and the like have been an absolute must if a business were to protect their competitive advantages from others.

In today’s digital world, the need for confidentiality and agreements is an absolute must as the sharing of secrets is easier than ever now; as simple as the clicking “send” on your phone or email system. 

Before we get to the nitty gritty of the agreements, we must first answer the question; what is considered confidential information?

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What is Confidential Information?

There really is no blanket definition of what constitutes confidential information; like love, and other emotions, it really is in the eye of the beholder. What one may consider confidential another might think is of no value. Whether it is a matter of opinion or not, the individual that feels the information is valuable enough to require an agreement, thereby safeguarding that information, has created a legal standard that can be enforceable to protect said information. 

The agreement has to be written in the right manner for it to have any protective power in the courts. They can neither be too broad, vague or too restrictive. 

It could be as simple as grandma’s secret recipe for chocolate chip cookies. Some families value these types of secrets; if the secret was let out, others could make the same cookies causing emotional harm to the family.

If that same family decided to go into business with said recipe and create a multi-million dollar business, then the “family secret” becomes that much more valuable and the confidential information that much more necessary to protect. 

If you have a need for a confidentiality agreement, or have questions about possibly protecting some business or personal information with an agreement, you should definitely reach out to an attorney for a consultation.

For those with questions, that live in the State of New York, get help from our experienced attorneys and expertise to answer all of your questions, with a no pressure consultation. 

Confidentiality or Non-Disclosure Agreements

So you have decided that you need some sort of an agreement; which one do you go with?

Again, determining this can require the expertise of an attorney. 

Typically, however, when it comes to the two different types of agreements, it comes down to confidential information being divided into two classes; personal information and competitive-advantage information. 

Non-Disclosure Agreements, or NDA’s, are typically used for competitive advantage information. If you work for a company, whether they are publishing novels and the stories must be kept secret until published, or you are working for a coding company, dealing with the security systems of companies, you most likely will have to sign an NDA to work there.

These companies know that their information is very valuable and if you left the job, or were tempted to sell secrets, it would harm their business and possibly their clients. To prevent that, companies require NDAs and let you know the consequences upfront if you were to violate that agreement.

What is Considered a Trade Secret?

What is considered a trade secret? Again, it can oftentimes be in the eye of the beholder, but for some companies, any secret that they consider confidential property or information that prevents other people from accessing that secret or information. 

Some tell-tale signs of a trade secret include:

  • They are typically not known to the public; i.e. confidential.
  • The knowledge of the secret would give the holder of the information an economic benefit. For example, if someone got the secret recipe for Coca Cola or KFC (Kentucky Fried Chicken)
  • If it is a secret that is clearly the subject of efforts to maintain its secrecy; for example, Lockheed Martin takes major steps to protect the secrecy of their defense contracts regarding weapon systems for the government. 

Obviously, trade secrets protecting an innovative weapon system is probably more “valuable” compared to a cooking recipe, but the two different secrets create competitive advantages for their respective parties. Whether you think the secret is valuable or not, you should ALWAYS respect a confidentiality agreement or information you may have stumbled across, as access to such can cause major penalties and consequences for you or a given company.

Classification of Confidential Information

While there is a debate about what is considered confidential information, there are agreed upon levels, or classifications of confidential information. Some of those classifications are:

  • Confidentiality: A “blanket” term conveying to viewers that the information is secret, and that there is a duty to protect said information.
  • Highly confidential: This is information that if given to the wrong individuals could cause somebody financial, reptuational, or ethical harm. For example, attorneys will typically mark files that contain social security numbers or banking numbers as highly confidential. 
  • Top Secret: These are secrets that are typically kept under lock and key; medical records, student records, trade secrets (like the Coke recipe), etc. 

Personal and Competitive-Advantage

As we mentioned earlier, depending on whether the information is personal or competitive advantage information can determine whether you use a Confidentiality Agreement or an NDA. 

For ease of understanding, some examples of personally confidential information includes:

  • Date of Birth
  • Banking, Investment or Financial account details
  • Social Security Numbers
  • Identification account numbers
  • Driver’s License information
  • Passport Information
  • DD-214

avoiding disclosure of confidential information on social media

Some examples of competitive advantage information can include:

  • Business Plans
  • Patent applications, or invention designs
  • Blueprints
  • Chemical or recipe formulae
  • Business financial information
  • Customer, clients or supplier identifying information

Low and Highly Confidential

As mentioned previously, highly confidential information can contain sensitive numbers, like banking account numbers, social security information, etc.; the kind of information that can easily cause harm to an individual if someone received said information with an intent to steal a person’s identity.

Low confidential information might be personal information such as an address, school affiliation, politics, etc.; the kind of information that may give a person insight into someone or a business’s thoughts or ideas, but not information that can easily cause harm.

Whether High or Low confidentiality, individuals and employees must take precaution in avoiding disclosure of confidential information on social media or other network connected platforms; the information can be copied and spread quickly. 

Examples of Confidential Information and the Use of It

As we talked about earlier, there are many different types of confidential information and they are typically obvious based on a lack of public knowledge or security measures in place to protect the information.

Still, oftentimes, confidential information may be requested or made use of for some social good, such as research or other types of projects. 

Many times, institutions that collect sensitive information are asked to share the information. If the request shows promise as a research project, and does some good for society, the institutions may grant access, however, the data is shared in a non personally identifiable way, once again, showing the importance of safeguarding and protecting sensitive, confidential information. 

How to Protect Your Data

Many companies and institutions collect sensitive data and must, by law oftentimes, protect it.

For hard copies, these should be kept in a locked file cabinet in a room that is also locked and only accessible to a select few gatekeepers.

For digital information, which is most common today, the information must be collected on encrypted servers that are typically located off the premises for added security. 

These servers and networks require passwords and limited access and the daily upkeep and recalibration of security. 

Get Help of Experienced Attorneys with Your Confidentiality Concerns

If you have questions about confidentiality, NDAs, personal information or business data, we highly suggest you reach out to us at Moshes Law.

We have the experience and expertise to protect those things, ideas and proprietary property that you have worked so hard to cultivate. Confidentiality and the security thereof is not to be taken lightly and requires the help of a trusted friend in the legal field. 


What Does Disclosure Mean?

Revealing info to the public is called disclosure. Often companies and corporations disclose internal information in a proper way to alert their investors, clients and employees about future changes.

Is there a Difference Between Confidential and Private Information?

Confidentiality and privacy both correlate with the information about your person and data you accord. But there is a slight but simple difference: privacy means information about people, and confidentiality affects general data.

What are Possible Reasons to Disclose Confidential Information?

Confidential information can only be disclosed to the public without the patient’s permission, or if consent has been withheld, where the benefits to an individual or society of disclosing outweigh the public and patient’s interest in keeping the information confidential.

About the Author

Gennady Litvin, Esq. is an associate with the Law Office of Yuriy Moshes, P.C. Mr. Litvin graduated Pace university with a Bachelor’s Degree in Business Economics, and earned his J.D. at the University of Miami School of Law where he was a member of the Business Law Review. 

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