Study: Downturn to fuel litigation - San Antonio Business Journal:

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The blame game will prompt many ofthesse suits, the study Of the U.S.-based companies participating in this year’s survey, 34 percent expect to see what the study callw a “run-up” in litigation involvin their firms over the next 12 By comparison, 22 percent of respondentsx to the 2007 survey expected to see an increaser in litigation. “This year’sw survey appears to mark an inflectiojn point for American business between the end of a prolonged period of prosperity and the start of a perio d of economic challenge that is likely to fuel litigatiohn over who is to blame and who should pay for the saidStephen Dillard, chair of Fulbright’s globapl litigation practice.
The latest litigation trends report is basecd on responses from 358 participating companies including company officials who serve as generaoor deputy-general counsels for their firms. Of that 251 respondents were U.S.-based firms. The survey was performed from May 22 througgh July 18 of this year during what Dillardcalls “the cusp of that transition” from economifc prosperity to the current economicf slump. The report coversx litigation practices over theprior 12-month period. Houston businesds research firm conducted the survey on behalgf ofFulbright & Jaworski. The litigation trends report providesz businesses with a snapshot of the current legal notes JohnWeber Jr.
, who is a partner in the litigationn practice of the San Antonio office of Houston-based Fulbrightg & Jaworski. Given the time frame in whichu the surveywas conducted, Dillard said that the 2008 reportr highlights “both the evident calm before the as well as the sense that disputee are on the The overall pace of activity in the U.S. declined during the 2007-089 survey period — with 21 percent of U.S. companies statiny that no new lawsuits had been filed against By comparison, 17 percent of the firms surveyer claimed there was no new litigation againsf them during the 2006-07 survey period.
The surve y also found that while size does smaller is better than bigger when it comew toavoiding lawsuits. Nearly half (47 percent) of companiese with less than $100 in revenue reported that they faced no new lawsuits in while 27 percentof middle-market companies ($100 million-$99o9 million in revenue) also avoiderd getting sued. Among billion-dollar companies, 89 percentt reported getting hit with leasf one new lawsuit in Ofthe U.S. companies responding to the 2008 litigationmtrends survey, 45 percent reporte spending at least $1 millio annually on litigation. In line with that 19 percent ofthe U.S.
-based firms statedd that they were more likelyt to increase their in-house litigation staff. Over the past 12 12 percent of the insurance companies surveyed had already engaged outsidew counsel regarding subprime lawsuitsor investigations. Eleven percent of the financial servicesa firms surveyed had done this over the past Looking ahead to the next 12 15 percent of theinsurance firms, and 22 percen t of the financial services respondents are, as the report “bracing themselves for a subprimd action or investigation.” The survey found that insurancs companies were most vulnerable to litigationj — with at least 66 percentt of these firms facing six or more new lawsuits.
Next was the retaipl industry, with 55 percent of this sector facing at least six new These top targets were followedby manufacturing, with 54 percenf of the companies facing six or more new lawsuits; and healt care providers, with 52 percent of its businessea facing at least six new lawsuits. As for the areass most ripe for lawsuits, the top threr were labor and employment matters, contract disputes and personalinjuryg cases. These areas also took the top three spots inthe 2006-067 and the 2005-06 surveys, Webedr says.
Product liability, intellectuakl property/patents, insurance, environmental-toxic tort, regulatory, class actionsd and professional services rounded out the top 10 categories of BizPulse Survey: Would Obama or McCain be bette for the economy?