Workplace, Cybersecurity and Regulatory Disputes Top Trends in Business Litigation

Global law firm Norton Rose Fulbright’s 18th Annual Litigation Trends Survey, released earlier this year, found that corporate counsel faced a significant rise in regulatory proceedings in 2022, with more expected this year, as agency enforcement activity picks up. In fact, half of the survey respondents were involved in at least one type of regulatory proceedings last year, and more than one-third expect such proceedings to increase in 2023.

The survey also reveals heightened litigation risk in key areas: the top three spots in which respondents expected disputes exposure to increase this year are employment and labor, cyber and data protection, and diversity, equity and inclusion (DEI). The report also explores class actions in greater depth, revealing fresh insights into an area that more than 33% of respondents identified as a critical concern in 2023.

“Our experience precisely mirrors what our respondents say,” said Steven Jansma, Norton Rose Fulbright’s U.S. head of litigation and disputes. “Government agencies are eager to bring impactful cases and investigations, and we are seeing robust enforcement efforts across the board.”

This year’s report is based on a survey of more than 430 general counsel and in-house litigation leaders, based in the United States and Canada, in industries such as financial services, energy, healthcare and technology. The research also includes insights from in-depth interviews to better explore emerging trends and the litigation challenges facing leading organizations. “Corporate counsel anticipate increased exposure to employment and labor disputes in 2023, and DEI is an increased litigation concern for the third straight year,” said Shauna Clark, Norton Rose Fulbright’s U.S. head of employment and labor who is also the firm’s U.S. chair. “Between the current regulatory environment, economic headwinds and lingering effects of the pandemic, now is not the time for business leaders to scale back their preparation.”

Despite these challenges, corporate counsel feel largely prepared to address litigation in the year ahead, with respondents citing factors including their organization’s in-house litigation experience and confidence in external counsel, as well as in-house tools and capabilities such as eDiscovery platforms and data protection solutions.

“Companies have become very sophisticated in connection with risk mitigation, litigation management and the retention of highly skilled in-house counsel and outside trial lawyers to prosecute or defend cases which they face,” said Richard Krumholz, Norton Rose Fulbright’s global head of litigation and disputes. A comprehensive report detailing the survey’s findings is available at litigationtrends. com. Highlights include:

• Sixty-five percent of respondents reported that they had to work on employment and labor disputes last year. They also ranked it first among the most concerning areas in the year ahead, amid increased enforcement actions, rising unionization activity and a heightened focus on social justice and DEI.

• Cybersecurity, data protection and data privacy are also top of mind, with one-third of respondents experiencing litigation in this area last year. It was the number two area in which respondents expect dispute exposure to increase in 2023.

• More than one-quarter of respondents (28%) said their exposure to environmental, social and governance (ESG) litigation increased in 2022, and 24% expect increased exposure in the coming year.

• Class action activity and risk parallel the broader litigation landscape, with employment and labor identified as the most common type of class action encountered in 2022. It was also the leading area of future concern when it comes to class actions, followed by cybersecurity, data protection and data privacy, while ESG ranked third.

• Healthcare, including life sciences and retail, were the leading industries when it comes to an expected uptick in regulatory proceedings, with 46% and 45% of respondents in those respective sectors predicting an increase in the coming year.

• Thirty-six percent of corporate counsel surveyed expect to increase the number of in-house litigators in 2023, up from 22% the previous year.

Introduced in 2004, Norton Rose Fulbright’s Annual Litigation Trends Survey is the longest-running survey of corporate counsel on litigation issues and trends. Labor, data protection and DEI litigation are key risk areas for 2023; class-action suits remain a critical concern.