New research into litigation trends has identified cybersecurity as a major new source of legal disputes in the United States.
The 2019 Litigation Trends Annual Survey conducted by global law firm Norton Rose Fulbright questioned corporate counsel about dispute-related issues and concerns.
Of the 287 lawyers polled, 44 percent said that they foresee cybersecurity and data protection as a new source of disputes during the next few years.
The results of the 2017 and 2018 editions of the Litigation Trends Annual Survey saw cybersecurity and data protection concerns coming to the forefront as a key challenge in dispute management. However, the trend saw a marked rise this year, with respondents reporting an increase in the number of disputes triggered by data privacy issues.
From 2018 to 2019, the number of in-house counsel who rated cybersecurity and data privacy as the most important litigation issue they faced doubled. More than half of those surveyed (52 percent) feel more exposed than previously to such disputes.
Respondents to Norton Rose Fulbright's survey said that their concern over cybersecurity stemmed from the volume of threats, the creativity of threat actors, and the sensitivity of the data content. Counsel were also worried about some jurisdictions’ enactment of stringent data privacy laws.
Rapid growth in the size of the organization was also a key factor. One respondent quoted in the research wrote: "We’re growing at such a fast rate, in terms of the number of companies and the volume of work in the insurance industries, we have a large number of consumer-facing data points, so our consumer data retention is probably tripling yearly."
Companies in 2019 whose in-house counsel took part in the survey spent $1.5m on average on disputes and employed 2.5 disputes lawyers per $1bn of revenue.
Researchers found that more than 80 percent of companies conduct third-party and/or in-house assessments of cybersecurity and data protection risks, and such assessments are helpful in reducing these types of risks.
Other findings of the research are that counsel predict a rise in litigation caused by an anticipated economic downturn. Thirty-five percent of corporate counsel—8 percent more than in 2018—expect disputes to increase in the next year. Nearly two-thirds of corporate lawyers said economic downturns lead to an increase in litigation cases.
Introduced in 2004, the Norton Rose Fulbright’s Litigation Trends Annual Survey is the longest-running survey of corporate counsel on litigation issues and trends.