Breaking the agreement is called a breach of contract, which is the failure to perform, without legal justification, any promise that forms all or part of the contract. When a party discovers that its agreement has been violated, the first step it takes is to investigate and gather all the evidence it has. The party needs to find concrete evidence in order to make a strong court case. Once you have gathered the evidence, the next step is to consult with your attorney so they can review the NDA and the evidence to find the best course of action. This is the step where they can send a cease and desist letter to the defaulting party. If the defaulting party ignores the cease and desist letter, the last step is to take legal action against them. When a particular party or employee violates an NDA, the non-breaching party can sue for damages or apply many other different penalties. Typical penalties include a fine, mandatory restitution of the value of the stolen information, dismissal, loss of future job prospects, prison time, or court probation. These fines can become quite severe when dealing with a large company. For example, there was the court case RRK Holding Company v. Sears, Roebuck & Co.. RRK Holding Company manufactured a spiral saw. The company has entered into an NDA with Sears to sell the product exclusively in its store. During the negotiations, the