Non-public information: Overview, definition, and example
What is non-public information?
Non-public information refers to any data or details that are not made available to the general public or outside of a specific group or organization. This can include sensitive or confidential information about a business, product, financial performance, or personal matters that is intended to remain private. Non-public information is often protected by laws or regulations, especially when it involves trade secrets, intellectual property, or personal data. In many industries, handling and disclosing non-public information is subject to strict legal guidelines to prevent unfair advantages or harm to individuals and businesses.
Why is non-public information important?
Non-public information is important because it often contains valuable or sensitive content that, if made public, could influence decision-making, market conditions, or personal privacy. Protecting non-public information is essential to maintaining business confidentiality, competitive advantage, and compliance with regulations. For example, public companies are required by law to keep certain financial data private until it is officially disclosed to the public. Similarly, non-public information regarding clients, employees, or proprietary business processes must be handled carefully to avoid potential legal violations, damage to reputation, or loss of competitive edge.
Understanding non-public information through an example
Imagine a company is developing a new software product, and the details of the product's features and release date are shared only with the internal development team. This information is considered non-public until the company officially announces the product to the public through a press release. If an employee were to share these details with external parties before the public announcement, they could be in violation of company policies or securities laws, as the information was meant to remain confidential until publicly disclosed.
In another example, a law firm is representing a client in a high-profile legal case. The details of the case, such as evidence and strategy, are non-public information. The firm is legally bound to protect this information from being shared with unauthorized individuals to maintain client confidentiality and avoid compromising the case.
An example of a non-public information clause
Here’s how a non-public information clause might look in a contract:
“The Parties agree to maintain the confidentiality of all non-public information disclosed during the term of this Agreement. Non-public information shall not be disclosed to any third party without the express written consent of the disclosing party, except as required by law or regulation.”
Conclusion
Non-public information is crucial for maintaining confidentiality, privacy, and competitive advantage. By protecting sensitive data and ensuring it is not prematurely disclosed, businesses can avoid legal complications, safeguard their market position, and respect personal privacy. Contracts often include provisions to protect non-public information, ensuring that all parties understand their responsibilities in handling such data.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.