Monday, August 16, 2004

Fulbright & Jaworski release study of top corporate counsel litigation concerns

The Number One concern was labor and employment, with 62% identifying it as the chief cause of action. Retailers especially fear employment suits -- 76% said it was their top concern. The Number Two concern was contract disputes (58%), followed by intellectual property, product liability and class action lawsuits.

Nearly half of companies reported some financial benefits from domestic arbitration, with 47% of respondents seeing a cost savings, 44% saying there was no difference, and 9% stating that it actually increased their costs over litigation. The risks of huge jury awards seemed to be the predominant concern in deciding whether domestic arbitration was worthwhile.

Counsel were also inclined toward nonbinding mediation: 60% favored this litigation alternative, while only 15% stood opposed. Larger companies in particular were pro-mediation, and mediation was perceived as much more cost- effective -- 70% of counsel found that it produced some level of savings. "Cheap -- faster than with trial or arbitration," was a typical pro-mediation comment. Another counsel noted that "non-binding mediation is always a welcome approach for parties to articulate their positions and positively work towards a resolution." --

When hiring outside counsel, money takes a back seat to relevant skill sets and historical success. Counsel were asked to name the top factors for selecting litigation counsel: cost-effectiveness actually registered fifth in importance. The Number One selection factor was specific case experience, followed by general knowledge, reputation, and past experience with the company. Cost may have drawn the most mentions overall, but companies appear to choose their litigators on the basis of expertise over economics.

28% of companies below $100 million in revenues filed a contract litigation since 2001


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