Wednesday, July 22, 2009

Can You Waive a Jury Trial in an NDA?

Dear Rich: I have a nondisclosure agreement (NDA) with a provision that includes the following language (which I haven't normally seen before) "[E]ach Party expressly waives any right to a trial by jury in any dispute arising in connection with this Agreement." Is this a common thing to ask? And if it's not by jury trial, then is the dispute simply kept in a courtroom with just a judge for the final decision? The short answers to your question are that (1) it is becoming more common to ask for jury waivers, and (2) yes, if you sign the agreement and a trade secret dispute arises you will have a bench trial in which a judge presides (unless you are in a state court dispute in California or Georgia where pre-dispute contractual waivers are not enforced). It's true that the Seventh Amendment guarantees your right to a jury trial but that right has been chipped away by various rulings. For example, you don't have the right to a jury in a battle over an injunction -- an order by the court to do or not do something. Since injunctions are a key remedy sought in trade secret lawsuits, you won't be giving up that aspect of your potential battle. 
Why Waive the Jury?
Jury waivers are usually sought by corporate entities who perceive that jurors tend to be biased against them, or because of the potential savings in money (less spent on attorney fees), and time (bench trials are much faster), and because of concerns that a jury would not grasp the technical nature of the dispute. These provisions are usually enforceable in NDA agreements (though not in all agreements) and they must be entered into "knowingly and voluntarily."  All that said, another reason to waive the jury trial is so that the Dear Rich Staff will not have to  make so many appearances in the Jury Assembly Room at 850 Bryant Street in San Francisco which is where we are right now. (Yes, the Dear Rich Staff is blogging live from S.F. Jury Duty -- is this the only city where citizens review jury duty like it was a movie? --   and we sure wish the guy next to us would stop trying to brush the potato chip crumbs in our lap -- oh good, he's done!). And oh yeah, our three favorite jury movies: