Norton Rose Fulbright releases 2017 Litigation Trends Annual Survey

Knowledge October 25, 2017

Thirteenth edition highlights ever-increasing threat to cyber security and data protection

Global law firm Norton Rose Fulbright today released its 2017 Litigation Trends Annual Survey. This year’s survey polled more than 300 corporate counsel – primarily general counsel – representing US-based organizations on disputes-related issues and concerns.

Survey respondents point to a growing threat to cyber security, an issue they indicate stands as the greatest emerging threat to a business. Nearly two-thirds of those polled (63 percent) feel more exposed to disputes in this area.

Gerry Pecht, Norton Rose Fulbright’s Global Head of Dispute Resolution and Litigation, said:

“For large companies that work with massive amounts of sensitive personal data, data protection is an absolute imperative. A single cyber event has the potential to expose a business to class actions and serious reputational risk. These are high stakes, and this report looks at measures companies take to mitigate this increasing risk.”

This year’s survey report also revisits its litigation minimization framework, a tool introduced last year to suit a company’s specific situation. In-house counsel can use this framework to review their current approach and implement measures to reduce litigation risk and costs.The program was well-received in its first year, with 95 percent of respondents implementing at least one recommended key measure. Training emerges as the leading factor in preventing litigation. Early case resolution, embedding lawyers in the business and proactive contract review have also shown to be highly effective.

An expansive report detailing Norton Rose Fulbright’s 2017 Litigation Trends Annual Survey can be found at Highlights of the report include

  • Companies who had no lawsuits commenced against them increased slightly from 18 percent to 21 percent over the last 12 months, with 79 percent of respondents being sued in the past year.
  • A review of the 10-year trend in disputes shows 2012 was the peak in terms of average volume. Mean disputes per $100 million in revenue fell slightly to 11.5 in 2017 from 11.8 in 2016.
  • Labor and employment and contracts remain the most numerous types of dispute for respondents. Contract litigation showed the largest year-over-year increase from 35 percent in 2016 to 43 percent in 2017.
  • This year, 74 percent of respondents indicated that regulators have become more interventionist, down from 97 percent in 2016. Also, 26 percent have moved to become less interventionist, a marked increase on last year’s 3 percent.
  • Alternative fee arrangements (AFAs) were used by 58 percent of respondents, with 96 percent of them satisfied with the work from an AFA. Fixed-fee AFA use increased from 67 percent in 2016 to 77 percent this year.
  • On average, a legal department spends 30 percent of its budget in-house; however, spending on disputes as a proportion of the organization’s revenue is least when its internal spend is between 41 percent and 60 percent of overall budget.
  • A detailed analysis of litigation expenditure data collected in this survey reveals that both team size and the typical spend relative to revenue has increased since 2016.

Introduced in 2004, this is the largest survey of corporate counsel on litigation issues and trends. The 13th edition of Norton Rose Fulbright’s Litigation Trends Annual Survey was conducted by Acritas, a global legal services market business research firm, which polled 318 corporate counsel, the majority of whom were US-based or represented US-based organizations.