Canada, Litigators, United Kingdom / Great Britain

The View From Up North: Who’s More Litigious, Canada or the United States?

How do the U.S., Canada, and the U.K. compare in terms of litigiousness, litigation spending, and types of cases being brought?

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Norton Rose has done something interesting and semi-useful. It conducted a survey of the experiences and opinions of corporate counsel regarding various aspects of litigation. It cleverly titled this report, “2015 Litigation Trends Annual Survey.” Apparently this is the eleventh annual edition of the report, which makes me wonder why I’m only hearing about it for the first time in 2015?

These are the nitty gritties: NR (through an independent research firm) surveyed 803 participants working for company headquarters in twenty-six countries. A large majority of the respondents (65%) worked for companies with $1 billion or more in revenues (all figures in U.S. dollars).

Here are some other interesting facts about the respondents:

1. More than half (58%) came from two industries: financial institutions and technology and innovation.

2. More than half (52%) came from the United States.

3. Eleven percent of the respondents came from the United Kingdom and ten percent from Canada, the land of the True North Strong and Free.

Interesting Results

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NR’s report is sixty-eight pages so I can’t share every detail with you. I thought I would pass along some things I found interesting, and do a bit of a comparison between Canada, the U.K., and the United States. Here we go.

Most numerous type of litigation in the previous twelve months: Thirty-eight percent of all respondents said contract disputes. Thirty-seven percent of all respondents said labour and employment. Regulatory/Investigations placed a distant third at 18 percent.

Contract disputes may have been the most common, but Regulatory/Investigations were the most worrisome. Thirty-nine percent said Regulatory/Investigations were most likely to keep them up at night. That makes sense. Contract disputes are relatively private and benign. They may be high ticket, in some cases, but rarely cause serious reputational damage. Contrast that with regulatory issues that can lead to reputational damage and large fines. To boot, who’s supposed to keep the company out of the regulatory crosshairs? Lawyers/compliance people. It must certainly add stress when counsel are not only the ones who have to lead the response, but also may be facing scrutiny for failing to prevent the regulatory issue in the first place.

Comparison between the United States, Canada and the United Kingdom

Approximately one-third of all Canadian respondents had 1 to 5 proceedings commenced against them in the previous 12 months. Just over ten percent of all Canadian respondents had 51 or more proceedings commenced against them. On a side note: holy smokes, 51? That’s almost one per week. I couldn’t imagine working at a company that gets sued so regularly.

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Contrast Canada with the United States, where only 26% of respondents faced 1 to 5 proceedings and 18% of respondents face 51 or more proceedings. For the UK, 36% of respondents faced 1 to 5 proceedings and only 5% faced 51 or more proceedings. Thus, as I would have guessed prior to reading this survey, U.S. respondents were much more likely to get sued multiple times in a year.

Additionally, U.S. respondents were more likely to sue. Forty-one percent commenced 1 to 5 lawsuits and 20% commenced 6 or more lawsuits. For Canadians, 32% commenced 1 to 5 and only 14% commenced 6 or more. In the U.K. it was 28% for 1 to 5 and only 12% with 6 or more. Pretty clear that American companies have the quickest trigger finger when it comes to laying a legal smackdown.

Here’s another thing I suspected, but now have confirmed: I always felt American companies faced much higher regulatory scrutiny than in Canada. Turns out 43% of U.S. respondents faced one or more regulatory proceeding in the previous 12 months. Only 19% of the Brits and 33% of Canucks faced one or more regulatory proceedings.

Big brother is always watching — just more so in the United States, it seems.

I’ll share two more related items, then let you get back to work. First, 25% of American respondents spent greater than $10 million on litigation in the previous 12 months. Only 11% of Canadian companies and 16% of British companies had similar litigation spends.

On the lower end, only 21% of American respondents spent less than $500k on litigation. Sixty-two percent of all Canadian companies and 41% of all British companies spent less than $500k.

Additionally, American companies had an average of 19.8 in-house litigation lawyers. The United Kingdom had an average of 14 and Canadian companies had an average of 4.3

Is it scientifically valid to extrapolate this data across the entire universe of companies based on 803 worldwide respondents? No, but what the heck do I know about science? I’m a lawyer. Thus, I would extrapolate as follows: Of the three countries we looked at, the United States is easily the most litigious, Canada the least litigious and the U.K. somewhere in the middle.

I don’t think anybody reading this is shocked by my scientifically invalid conclusion.

There’s a ton more in the report about alternative dispute resolution, alternative fee arrangements, class actions, intellectual property, etc., that make it worth reading for in-house counsel who deal with litigation. It’s also an excellent resource for out-house (sorry, outside) litigators who want to understand what their clients are facing.

That’s the View From Up North. Have a great week.

2015 Litigation Trends Annual Survey [Norton Rose Fulbright]

Steve Dykstra is a Canadian-trained lawyer and legal recruiter. He is the President of Keybridge Legal Recruiting, a boutique recruitment firm that places lawyers in law firms and in-house roles throughout North America. You can contact Steve at [email protected]. You can also read his blog at stevendykstra.wordpress.com, follow him on Twitter (@IMRecruitR), or connect on LinkedIn (ca.linkedin.com/in/stevedykstra/).

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