The Receiving Party acknowledges and agrees that the Confidential Information shall remain the sole and exclusive property of the Disclosing Party. Nothing in this Agreement shall be construed as granting any rights to the Receiving Party in the Confidential Information, by license or otherwise, except as expressly set out in this Agreement.
This ownership clause makes clear that any confidential information shared by the Disclosing Party remains their exclusive property.
In simple terms:
- The Receiving Party acknowledges the confidential information belongs solely to the Disclosing Party.
- Nothing in the agreement gives any rights in the confidential information to the Receiving Party, unless expressly stated.
- There is no license granted to the Receiving Party over the confidential information by default.
The purpose is to avoid any impression the Receiving Party has gained any intellectual property or other ownership rights simply through receiving the confidential information. It reinforces that the Disclosing Party retains full control and ownership.
Overall, this clause protects the proprietary rights of the Disclosing Party and prevents any unintended transfer or license of the confidential information.
Confidentiality and non-disclosure agreements have a long history, emerging in concert with the growth of proprietary business information and trade secrets.
As companies began developing valuable knowledge and techniques in the 19th and early 20th centuries, there was a need to share some of this sensitive information with partners while preventing wider disclosure. Early attempts to protect confidential information were done through "gentlemen's agreements," but these informal pacts proved inadequate. By the mid-20th century, NDAs became commonplace business tools to allow controlled sharing of proprietary information.
The core purpose of NDAs has always been to establish confidentiality obligations on the Receiving Party. But additional clauses emerged over time to reinforce the Disclosing Party's ongoing ownership and prevent unintentional licensing of information. Ownership clauses directly state the Receiving Party has no rights or license to the confidential material, unless expressly granted. This evolved from court rulings that found implied licenses even when NDAs were silent on ownership. Adding explicit ownership language shored up protections for the Disclosing Party and became a best practice.
While confidentiality is the heart of an NDA, complementary clauses like ownership protections help fulfill its ultimate purpose - allowing controlled information sharing while keeping proprietary knowledge secure.