Financial Crisis to Fuel Rise in Litigation

Two occupations that for sure won’t be experiencing unemployment troubles during the financial crisis: politician and lawyer. Politicians will be busy pointing fingers and looking clueless while lawyers will be bracing for a boon in litigation stemming from the collapse of the subprime mortgage market. A survey of 360 in-house counsel in the UK and US show small businesses and major corporations alike are preparing for a busy lawsuit season expected to affect pretty much every sector.

Each industry has its own type of litigation to expect—in the tech sector, for example, they can expect an up-tick in intellectual property and patent lawsuits—but all sectors are expected to see a rise in employment-related litigation over things involving contracts, wages, discrimination, and privacy.

The fifth annual survey of corporate lawyers, entitled Litigation Trends Survey, comes from international law firm Fulbright & Jaworski. Almost half of the companies represented were publicly held, and 40 percent earned revenues of over $1 billion.

In the previous two-years the survey was conducted, litigation was actually down. From 2007 to 2008, 21 percent of companies reported no new lawsuits filed against them, an improvement from the 17 percent free of litigation the year before, and 11 percent the year before that.

As the number of lawsuits dropped for many companies, so did the dollar amounts. (Don’t tell Google that, though, thanks to a couple of