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To ensure their stable positions in business all companies try to protect their information, which is directly related to products they manufacture and sell. That kind of information is called trade secrets, which is business data of economic value about something, which has costs and an effort to develop and is unknown to the public. There is a large risk that trade secrets can be revealed to companies competitors. For example, this can happen due to employees changing their jobs, or industrial espionage, which is illegal. There are the following ways that organizations can try to protect that data: making their potential employees to sign non-disclosure agreements, or non-compete contracts, or both. In this paper I am going to discuss the former. Non-disclosure agreements are legal documents between an employer and an employee, between a company and third-party developers and between two companies where the latter agrees not to take copies of computer programs and not to reveal any details about software that was produced by an organization. There is an ethical issue with NDA because protecting trade secrets can involve looking at those relationships listed above. It can be shown through the following couple of examples that discuss relationships between companies and people (developers, employees, etc).

The first case talks about the lawsuit between Hewlett-Packard Company, or HP, and its former CEO Mark Hurd. It was brought to the court arena because Hurd moved to work for HP's competitor that is Oracle Corporation. The cause of Hurd's decision was the scandal that an employee, Jodie Fisher, lifted because of “sexual harassment” from the former CEO' side. After the company investigated that problem, it was found there was not any actual sexual harassment. HP's reaction to sue Hurd is understandable because the organization gave him millions of dollars for keeping important trade secrets as he signed the non-disclosure agreement. Such the event was indeed troublesome for Hewlett-Packard Company because their former CEO was going to take the position of Co-President in Oracle Corporation. According to HP, this could lead to the “inevitable disclosure of trade secrets”. As the New York Times implies Hurd did not have a non-compete contract with the company because California courts do not favor those types of legal documents. This is to ensure employees' mobility while looking for jobs and going to work in places, which they find most comfortable and beneficial. As the author of that article concludes this case showed that it is impossible for companies to prevent their employees from moving to their competitors. Lisa Chapman, from Royse Law Firm, PC, in her paper discusses this lawsuit and says that California courts' position against non-compete agreements remains pretty strong. She also says that companies, which accept workers from their competitors, should familiarize themselves with trade secrets laws and should not exploit workers' knowledge to gain competitors' confidential data. Otherwise, if they do, then they can be liable for their actions.

The second case relates to a relatively young sphere of IT, which is application development for mobile platforms. The Android is a software stack that includes operating system, middleware and applications. It is now maintained by Google, Inc. and was previously purchased from Android, Inc. in 2005. The system is based on the modified Linux kernel, and its source code was made public under the Apache license. However, in 2009 there was an interesting case that Google, Inc. decided to open the source code of the Android 2.0 only for a limited number of developers. To select those chosen ones the company organized the Android Developers Challenge, which is a competition to encourage developing the best applications. The winners were those whose applications gained the highest score. The reason for such the action was to complete the project as quickly as possible. It was so as the fewer people were working on it, the faster they would go. This argument was given by Eric Chu, who is Google's Mobile Platform Program Manager. Why is it related to NDA? There was also another small nuance that, after winners had been chosen, Google, Inc. required them to sign the non-disclosure agreement. This was so that Android developers would not be able to share any information regarding software in the Android 2.0. Such the news shocked many people because it directly contradicted the nature of open-source. According to the Apache License, under which the Android is distributed, its users should have the ability to freely use it, modify it and distribute it. That NDA certainly made those features unavailable for most developers, which made the Android 2.0 no different from, let us say, Windows by Microsoft Corporation, which is also closed for only a limited number of people, or any other proprietary software.

More recent news about the Android 3.0 are not really satisfactory for the open-source community either. This is so because Google's spokesman said that they were not going to release the latest software to the public until they did not finish their work on it. One year earlier Andrew Rubin, Senior Vice President of Mobile, stated his definition of openness responding to Steve Jobs's, Apple's, Inc. CEO, objection that the Android was not open. The definition meant that the software was opened if anyone could download its source code and compile it him / herself. According to that statement, the Android 3.0 is not open-source.

The third case relates to the nowadays Google's biggest competitor in the area of mobile computing, which is Apple, Inc. This company is specializing in manufacturing desktop and portable computers, cell phones, MP3 players and other gadgets. Since it is supporting its hardware products with its own proprietary software, it has become known as one of the most closed and secret companies. This is because of different stories where they tried to stop prototypes of their new products from leaking, but sometimes they failed. As for the iPhone OS, also known as the iOS later, Apple, Inc. required third-party application developers to sign the non-disclosure agreement for a long time. It was so as to add an additional security level, according to the company. However, in 2008 something pleasant happened for those programmers. Apple, Inc. dropped their NDA from the iPhone software. This was a strategic move to clean its bad reputation about a very strict closeness of the platform, and also not to lose its leading position in the mobile computing race against competitors. Now iOS developers are free to discuss current platform features and flaws, which they encounter, with each other and the outside world.

After looking carefully at those cases described above, it can be noticed that the NDA problem can be applied both to complex corporate issues and third-party developers, who choose to use tools, which are supplied by a certain company. Although the first case describes the problem, which exists only in the Silicon Valley, it can be shown what risks an organization can face if its top employee leaves with a handful of trade secrets in his head. Especially, it can seriously damage the former organization's business if that top employee's employer is its direct competitor. The Silicon Valley problem might be fixed with making employees to sign non-compete agreements. However, it impairs a worker's ability to search for new jobs. In some cases, it may also be impossible to find a job for a person, who was fired, or who left for other personal reasons. Difficulties may be either his / her specialty, or an exposure to extremely confidential data, which many competing organizations can find interesting to obtain. The rest two cases describe how non-disclosure agreements impact developers, who are not directly involved in corporate affairs, e.g. freelancers. The abuse of open-source licenses described above can impede the project development, or can hide something from the community's eyes. This is so because, for example, no one ever decided not to open source code for one of numerous Linux distributions. This is so as many enthusiasts across the world can work on the same project and catch bugs faster. Such the system simply works because those numerous Linux distributions are still alive and have many users, who are happy to use them. Putting non-disclosure agreements onto third-party developers can dramatically slow down the development of mobile applications and discourage many programmers to put their, perhaps innovative, ideas into reality.

In conclusion, the problem of non-disclosure agreements is very complex and has many issues to consider. In order to solve it, we need to take in account all agents that can be affected such as employers, employees, third-party developers. We should take care of each in such a way so that to minimize a potential damage, which can be taken by all involved entities.

References:
1. George W. Reynolds, “ Ethics in Information Technology, Third Edition ” (pages 207-209)
2. Gregory Gromov, ”NDA Experiment Set up by Mark Hurd.”, http://www.netvalley.com/silicon_valley/Hurd_NDA_HP.htm
3. Ashlee Vance, “H.P. Sues Its Ex-Chief in New Job”, http://www.nytimes.com/2010/09/08/technology/08hewlett.html
4. Lisa Chapman, “The Impact of the Mark Hurd Saga on California's Ban on Covenants Not to Compete, ”http://www.rroyselaw.com/newsletter_mark_hurd_saga.html
5. Wikipedia, “Android (operating system)”, http://en.wikipedia.org/wiki/Android_%28operating_system%29
6. Google Code, “Android Developer Challenge”, http://code.google.com/android/adc/
7. Rob Jackson, “Android 2.0 Developers Face Another NDA”, http://phandroid.com/2009/10/27/android-2-0-developers-face-another-nda/
8. Wikipedia, “Apache License”, http://en.wikipedia.org/wiki/Apache_License
9. Cade Metz, “Steve Jobs vindicated: Google Android is not open”, http://www.theregister.co.uk/2011/03/24/google_will_not_open_source_android_honeycomb_on_release_of_first_devices/
10. Jason Chen, “This is Apple's Next iPhone”, http://gizmodo.com/5520164/this-is-apples-next-iphone
11. Zach Epstein, “Apple kills NDA on iPhone app development”, http://www.bgr.com/2008/10/01/apple-kills-nda-on-iphone-app-development/