Norton Rose Fulbright's 10th Annual Litigation Trends

US companies increasingly concerned about regulatory investigations

April 15, 2014

The number of US companies facing regulatory proceedings increased for the third consecutive year, according to Norton Rose Fulbright's 10th Annual Litigation Trends Survey.

The upward trend is the result of a stricter regulatory environment and increased scrutiny from a broad range of state and federal agencies. Close to 20 percent of survey respondents said their companies had faced a regulatory/investigation matter in 2013, up from 9 percent in 2012. The increase was consistent among all industries and companies of varying sizes, but was most pronounced among technology/communications organizations (27 percent versus 10 percent in 2012).

Otway Denny, US Disputes Head, Norton Rose Fulbright, said:

“We continue to see the scope and frequency of regulatory investigation matters increase in the US, as government agencies take a more proactive approach in determining compliance. Stricter regulations governing financial, environmental and workplace issues create a more complex environment for businesses, and these results show that a serious regulatory investigation is a reality for a growing number of companies each year.”

Norton Rose Fulbright's 10th Annual Litigation TrendsThe survey also found that 59 percent of respondents had retained outside counsel for assistance with a government or regulatory investigation during 2013, basically unchanged from 2012. The majority of cases cited involved the Department of Justice (34 percent), the Securities and Exchange Commission (23 percent) or the Environmental Protection Agency (22 percent), in addition to investigations led by a number of other federal, state and local entities.

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. The increase is most pronounced among technology/communication companies (56 percent in 2013 versus 16 percent in 2012), as well as financial services (57 percent versus 24 percent) and healthcare (52 percent versus 24 percent).

The survey also found that labor and employment disputes and contract matters once again were the most common litigation issues facing U.S. companies. A total of 48 percent of respondents said that labor and employment issues topped the number of cases their organization faced in 2013, and 36 percent said contract issues were most numerous.

In general, the number of lawsuits filed against respondents’ companies in the past 12 months was stable, with no significant change since 2010.

This is Norton Rose Fulbright’s 10th annual litigation trends survey of corporate law departments in the United States. A total of 401 senior corporate counsel executives – representing a broad range of industries – responded to the survey, which was conducted in late 2013/early 2014.

Download Norton Rose Fulbright's 10th Annual Litigation Trends Survey