U.S. businesses were tangled up in less litigation during a recent 12-month period than the year before, according to the 2011 Fulbright & Jaworski Litigation Trends Survey. However, internal investigations and regulatory actions are on the rise.
The lull in litigation is not expected to last, as 92 percent of corporate counsels polled predict litigation levels to remain the same or increase within the next year. The report cited stricter regulation and company growth as factors for the expected litigation increase.
The median spending on litigation rose from $1 million from July of 2009 to the end of June of 2010, to $1.4 million in the subsequent 12 months, the survey found.
During these uncertain economic times, corporate counsels also worked to make fees more predictable over the last year, with 51 percent reporting using alternative fee arrangements. The arrangements were reportedly used by 70 percent of insurance and health care companies.
Internal investigations reached an all-time high in 2008 – 49 percent of U.S. companies polled used outside counsel to conduct internal investigations. Over the past year, however, the number of internal investigations dipped slightly to 46 percent.
On the regulatory front, 55 percent of U.S. companies retained outside counsel to conduct regulatory investigations, which reached a four-year high. The bulk of investigations were initiated by the Department of Justice, state attorneys general, the Occupational Safety and Health Administration, and the Environmental Protection Agency.
In the past, the DOJ probes focused on manufacturing and health care. However, this year the agency went after engineering, health care and technology companies.
The survey, which polls corporate counsel on litigation issues, was conducted by Greenwood Associates, a Houston research firm.