Tag Archives: Norton Rose Fulbright

Litigation Trends and the Class Action Factor

Survey more than 800 corporate counsel representing companies across 26 countries on litigation trends and issues and you get some insightful findings.

Such is the case with the recently released Norton Rose Fulbright 2015 Litigation Trends Annual Survey.

For example, class action lawsuits were listed as the top issue by respondents in the United States, Canada and Australia.

U.S.-based respondents also reported a more litigious business environment than their peers, with 55 percent facing more than five lawsuits filed against their companies in the previous 12 months, compared with 23 percent in the United Kingdom and 22 percent in Australia.

There are also significant differences in the types of litigation that U.S. companies face compared with their peers worldwide.

For example, personal injury litigation is much more prevalent in the U.S. than elsewhere, with 21 percent of those polled selecting it as one of the most numerous types of cases faced in the previous 12 months, compared to just 15 percent in the survey overall.

In addition, intellectual property/patents (18 percent) and product liability (17 percent) cases were more common in the U.S. than worldwide (13 percent and 11 percent, respectively).

Going forward, more U.S. respondents say regulatory/investigations are a top concern (48 percent) compared with the broader sample (39 percent).

Intellectual property (IP)/patents disputes are also of greater concern in the U.S. (30 percent) compared with all respondents (21 percent).

In addition, more U.S. respondents list class actions (25 percent) and product liability (18 percent) as top concerns compared with the total sample (18 percent and 14 percent, respectively).

In the words of Richard Krumholz, head of dispute resolution and litigation, United States, Norton Rose Fulbright:

Our survey clearly demonstrates that the litigation and regulatory environment in the United States continues to pose some of the greatest risks which businesses from around the world face. This is reflected in rising litigation budgets and the size of disputes-focused staff compared to peer companies around the globe.”

Just to be clear, the average U.S. company has 20 in-house lawyers to handle disputes and the number of U.S. companies with an annual litigation spend of $1 million or more increased from 52 percent to 69 percent from 2012 to 2014.

Slightly more than half of the survey respondents are from companies with headquarters in the U.S.

The  Insurance Information Institute (I.I.I.)  has an excellent resource on business liability insurance here.

Survey: Lawsuits Steady, But Financial Impact Rises

While the number of lawsuits filed against U.S. companies in the past year was stable, the financial impact of the litigation they face continues to increase, according to Norton Rose Fulbright’s Annual Litigation Trends Survey.

More than one-third (34 percent) of all companies faced at least one lawsuit with more than $20 million at issue in 2013, up from just 23 percent in 2011, continuing a trend in recent years that’s left fewer respondents untouched by high-value cases.

Energy companies are much more likely to have one or more large lawsuits pending against them compared to other industries (52 percent versus 34 percent for the total sample), the study found, as are larger companies generally (51 percent versus 34 percent for the overall sample).

Among the largest companies surveyed (revenue greater than $5 billion), two-thirds reported having one or more lawsuits greater than $20 million pending against them, twice the rate for the overall sample.

Meanwhile, the percentage of larger companies spending $10 million or more annually on litigation increased to 43 percent in 2013 – the second consecutive year of growth (33 percent in 2012, 19 percent in 2011).

Another key takeaway from this year’s study is that healthcare industry respondents had the most litigation matters compared with other industries, with 55 percent indicating more than 20 suits versus 30 percent for the overall sample.

That increased activity also led to higher spending, with 49 percent of healthcare respondents reporting a 2013 litigation spend of $5 million or more, closely followed by energy at 46 percent.

The percentage of financial services companies spending $5 million or more on litigation more than doubled to 38 percent in 2013, up from 15 percent in 2012 and just 11 percent in 2011.

Labor and employment disputes once again were the most common litigation issues facing U.S. companies in 2013.

The number of U.S. companies facing regulatory proceedings increased for the third consecutive year, reflecting a stricter regulatory environment and increased scrutiny from a broad range of state and federal agencies.

Not surprisingly, legal counsel concerns over regulatory/investigation matters are also up sharply in the 2013 survey, with 41 percent of respondents indicating it as a top concern, versus just 23 percent in 2012.

Norton Rose Fulbright’s 10th annual litigation trends survey of corporate law departments in the U.S. saw responses from a total of 401 senior corporate counsel executives representing a broad range of industries.