The annual Fulbright & Jaworski Litigation Trends Survey provides a revealing yearly snapshot of the state of corporate litigation. Now in its eighth year, the survey polls corporate law departments in the U.S. and U.K. on the state of their disputes. For this year’s survey, Fulbright gather input from 405 in-house counsel, including 275 in the U.S.
The big headline from this year’s survey, which was released Oct. 18, is that litigation was down slightly for businesses on both sides of the pond. At the same, they saw an increase in regulatory actions and internal investigations. More than a third of corporate counsel reported an increase in external regulatory inquiries and more than a quarter predicted that the coming year will be even worse.
Even though litigation was down slightly, litigation spending was up. For U.S. companies, the median spend in 2011 was $1.4 million, up from a median of $1 million the year before. Spending will continue to go up, the survey says, driven in part by the cost of e-discovery. Nearly a fifth of all companies and a quarter of large caps expect to see budget increases for e-discovery.
Cloud Computing: Up, Up & Away
For the first time, the survey asked about the use of cloud computing and the result suggests–as the survey put it–that cloud computing is “up, up and away.” More than a quarter of all respondents said that their companies use cloud computing. Among companies in the tech sector, 48% use it. Among public companies, 34% use it. In the manufacturing sector, 325 use it. A quarter of U.S. companies and 13% of U.K. companies said that they expect to move software to the cloud.
As use of the cloud increases, so does the frequency with which companies encounter issues relating to data preservation, collection and security in the cloud. Overall, 31$ of U.S. respondents and 50% of U.K. respondents said that they had to preserve or collect data from the cloud in connection with actual or threatened litigation. Of companies using cloud computing, 71% had to preserve data and 61% had to collect data from the cloud. Of the companies using the cloud, 28% reported having had a security breach.
We all know that cooperation is supposed to be the watchword in e-discovery, but the Fulbright survey found mixed results on the cooperation count. The survey asked respondents whether, in the past year, they had “made a concerted effort to be more cooperative or transparent with opposing counsel in your conduct of discovery.” There was an almost even split between those who said “yes” (34%) and those who said “no” (36%). The other 29% said they’d had no opportunity to be more cooperative.
Notably, one industry stood out for its efforts to improve cooperation among opposing counsel, the survey found. In the energy industry, 45% of respondents answered yes to the cooperation question. In contract, the insurance and real estate industries were at the low end of the cooperation scale, with only 17% and 19%, respectively, answering yes.
Among other findings of the survey related to e-discovery:
- 91% of U.S. and 55% of U.K. companies allow employees to use mobile hand-held devices.
- 30% of U.S. and 36% of U.K. companies have had to preserve or collect data from their employees’ mobile devices for litigation or an investigation.
- 45% of all companies have no restrictions on social media use.
- 18% of all companies have had to collect data from an employee’s personal social media account in a company litigation.
An interesting side note is that, when asked about their company’s social-media blocking policy, 10% of corporate counsel said they did not know. While this is down from two years ago–when 19% said they didn’t know–it is surprising that even a tenth of corporate counsel would not know their company’s policy.
Download the Survey
The full, 60-page survey covers much more than just e-discovery. You can download the complete survey for free at www.fulbright.com/litigationtrends. A Fulbright press release summarizes the survey’s key findings. From the download page, you can also register for a Nov. 1 Fulbright webcast that will present an overview of the survey.