In-house spending on class action defence has rebounded after four years of steady slump, with around 7 per cent more US companies fending off at least one class action lawsuit last year than in 2014.

According to the results of law firm Carlton Fields’ 2016 Class Action Survey, released on Monday, average legal spend on defending class action lawsuits has lifted in the United States for the first time in four years from $2.03 billion in 2014 to $2.1 billion last year. Of the 391 senior in-house legal professionals who responded to Carlton Fields’ survey, more than 60 per cent reported that their department was facing at least one major class action lawsuit, up 7 per cent on last year’s figures.

It’s not just the volume of class action lawsuits that seems to be on the up, but also the stakes attached. The number of reported class actions that can be categorised as ‘routine’ is falling, while the number of companies facing ‘high-risk’ class actions spiked more than a third last year from 37.1 per cent to 50 per cent. Currently, just over 70 per cent of the overall class action portfolio reported by in-house lawyers can be classed as ‘complex’, ‘high-risk’ or even ‘bet-the-company’, while just 28 per cent is considered routine. Financial exposure remains the number one class action risk cited by in-house counsel.

Read original article


Tags: