South Dakota Non-Disclosure Agreement (NDA) Review
South Dakota is one of the few states that writes a time limit for employee non-competes directly into statute: up to two years, within a defined area. That gives a clear benchmark for any restriction bundled into a South Dakota NDA. The confidentiality obligation itself is measured against the state's Uniform Trade Secrets Act, and South Dakota has little specific case law of its own on NDA scope.
Trade-secret law
Uniform Trade Secrets Act
Bundled non-compete
Enforceable if reasonable
Confidentiality & trade secrets in South Dakota
South Dakota protects trade secrets under its version of the Uniform Trade Secrets Act, and the federal Defend Trade Secrets Act applies on top. A reasonable NDA is enforceable, but courts still look at scope, an over-broad definition of "confidential information" with no exclusions is the most common weakness.
Watch for a non-compete inside the NDA
Enforceable for up to two years within the area where the employer does business. Under SDCL § 53-9-11.2 a non-compete is voidable by listed health care practitioners (contracts from July 1, 2023) and by community services providers for people with developmental disabilities (contracts from July 1, 2026).
A confidentiality agreement should protect information, not restrict who you can work for. If an NDA in South Dakota also tries to bar you from competitors or from soliciting contacts, treat that as a separate restrictive covenant and judge it by South Dakota's non-compete rules above.
How long can a South Dakota restriction run?
SDCL 53-9-8 makes contracts restraining a lawful profession, trade or business void, except as the following sections allow. SDCL 53-9-11 permits an employee to agree not to engage in a similar business, or solicit existing customers, within a specified area for up to two years after employment ends, provided the employer continues a like business there.
A restriction in a South Dakota NDA that runs longer than two years, or covers places where the employer does not do business, sits outside the statutory permission.
What protects confidential information in South Dakota?
South Dakota adopted the Uniform Trade Secrets Act at SDCL chapter 37-29. It protects information with value from secrecy that is subject to reasonable efforts to keep it secret, and supports injunctions and damages for misappropriation.
Because South Dakota has relatively thin case law on NDA scope, courts are likely to look to the statute's definition and to decisions from other uniform act states. An NDA tied to that definition, with the standard exclusions, is on solid ground. One that claims ownership of general skill or public information is not.
If your South Dakota NDA names another state's law, check whether that choice would remove the two-year statutory ceiling, since governing-law clauses are a common way to import a longer restriction.
South Dakota sources checked 2026-10-09: SDCL ch. 37-29 (Uniform Trade Secrets Act) · 18 U.S.C. 1836, DTSA civil action (Cornell LII) · Speak Out Act, Pub. L. 117-224 (congress.gov). Laws change; confirm the current rule before relying on it.
What ClauseAudit checks in a South Dakota NDA
- Definition of "confidential information", narrow, or everything?
- The four standard exclusions (public, already known, independently developed, third-party)
- Duration, a defined term, or a perpetual obligation?
- A "residuals" clause allowing use of what is remembered
- Any bundled non-compete or non-solicitation, judged by South Dakota law
- Return/destruction obligation and one-sided injunctive relief
South Dakota NDA FAQ
Is an NDA enforceable in South Dakota?
Yes, a reasonable confidentiality agreement is generally enforceable in South Dakota, backed by the state’s Uniform Trade Secrets Act and, at the federal level, the Defend Trade Secrets Act. What matters is scope: an NDA with an over-broad definition of "confidential information," no standard exclusions, or a perpetual term is far weaker than it looks and worth narrowing.
Can an NDA include a non-compete in South Dakota?
NDAs sometimes bundle in non-compete or non-solicitation language, and in South Dakota a reasonable non-compete can be enforceable, Enforceable for up to two years within the area where the employer does business. Under SDCL § 53-9-11.2 a non-compete is voidable by listed health care practitioners (contracts from July 1, 2023) and by community services providers for people with developmental disabilities (contracts from July 1, 2026). A confidentiality agreement should not quietly restrict who you can work for, so flag any non-compete inside it.
What makes an NDA fair in South Dakota?
A sound NDA defines confidential information narrowly, includes the standard exclusions (public information, what you already knew, what you independently develop, and what a third party gives you), has a defined term rather than a perpetual one, and does not include a broad "residuals" clause or a hidden non-compete. ClauseAudit checks each of these against South Dakota law.
Can South Dakota enforce a non-compete buried in an NDA?
South Dakota is one of 34 jurisdictions where a non-compete is generally enforceable if reasonable in duration, geography and scope. Enforceable for up to two years within the area where the employer does business. Under SDCL § 53-9-11.2 a non-compete is voidable by listed health care practitioners (contracts from July 1, 2023) and by community services providers for people with developmental disabilities (contracts from July 1, 2026). Confidentiality obligations are a separate question and are not affected by any of that, which is why a restraint tucked into an NDA deserves reading on its own terms rather than as part of the secrecy clause.
If the restriction in my South Dakota agreement is too broad, what happens?
Courts may rewrite an overbroad restriction to something reasonable. That cuts against you: an employer has little to lose by drafting wide, because a court can pare the clause back rather than discard it. Negotiating the wording before signing matters more here than in states where an overbroad clause simply fails.
Does it matter which state's law the agreement names?
It can, because South Dakota's neighbours do not all agree: Minnesota (void), North Dakota (void), Wyoming (limited). Which law applies turns on the governing-law and venue clauses and on where the work is actually done, so those two clauses are worth reading before signing an NDA.
Can a South Dakota NDA include a customer non-solicit?
SDCL 53-9-11 expressly allows an employee to agree not to solicit existing customers within a specified area for up to two years. A non-solicit within those limits is likely enforceable. One reaching prospective customers, every customer nationwide, or lasting longer than two years is on weaker footing.
What federal protections apply to a South Dakota NDA?
The Speak Out Act bars enforcing pre-dispute nondisclosure and nondisparagement clauses in sexual assault and sexual harassment disputes. The Defend Trade Secrets Act protects confidential disclosures to government officials or attorneys to report suspected violations, and limits injunctions that would stop someone taking a new job.
Asked to sign an NDA in South Dakota?
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How neighbouring states treat restrictive covenants
Nationally: 4 jurisdictions treat employee non-competes as void, 13 allow them only in limited circumstances, 34 generally enforce them if reasonable.
South Dakota rules summarized as of October 2026; laws change. This is automated educational information, not legal advice. ClauseAudit verifies current South Dakota law when you run your NDA, and you should confirm anything critical with a qualified attorney.