This clause says that if information becomes public (through no fault of the other party), they are no longer bound by confidentiality—they can use or share it freely. It's high-risk because "public record" can be interpreted very broadly, and once information is public, you cannot control it anymore. The legal principle is that confidentiality agreements cannot protect information that is already in the public domain, but the question of what counts as "public" is often disputed. If a competitor leaks your information to a newspaper, does that make it public? If someone posts it on social media? The clause can create loopholes if it's not carefully written.
Negotiate to define "public record" very narrowly—it should mean only information that was already public before the confidentiality agreement started, or information that becomes public through no breach by the other party. Add language requiring the other party to tell you immediately if they learn your information has become public, so you can take action (like issuing a press release to control the narrative). Reject any language that lets them treat information as "public" just because one person outside the agreement knows about it.
Frequently Asked Questions
What does this clause mean in simple terms?
This clause says that if information becomes public (through no fault of the other party), they are no longer bound by confidentiality—they can use or share it freely.
Why should I care about this clause?
It's high-risk because "public record" can be interpreted very broadly, and once information is public, you cannot control it anymore.
What are my options?
The legal principle is that confidentiality agreements cannot protect information that is already in the public domain, but the question of what counts as "public" is often disputed.
How does this affect small businesses?
If a competitor leaks your information to a newspaper, does that make it public?