09 May 2018 at 17:25 BST

More class actions but less new staff to manage workload, reveals survey

The growing burden of class action suits is not being matched by recuitment strategies.

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Legal departments are dealing with more class actions, but have no new staff to manage them, according to the 2018 Carlton Fields Class Action Survey. Data indicated that while in-house legal departments face more class actions than ever before, they are not getting a corresponding increase in staff devoted to these types of matters. The report recommends legal departments need to strategize to manage these types of lawsuits.

Rising costs
The report reveals that class action spending has risen for a third consecutive year and is expected to increase again in 2018. Across industries, companies spent $2.24 billion on class action lawsuits in 2017. The number of companies facing class actions climbed to 59 percent, up from 53.8 per cent in 2016. Companies reported that the magnitude of potential exposure and risk also rose. While the average volume of class actions per company increased slightly, from 5.9 in 2016 to 6.3 in 2017, a more significant jump in class action matters per company is anticipated in 2018.

Regulatory concerns
Sixty-eight per cent of companies report facing one or more class actions on an ongoing basis, a number that has been fairly consistent for several years. For the first time this year, the survey reported on the intersection between regulatory proceedings and class actions. Over 70 percent of companies report having faced regulatory proceedings and class actions concurrently. They continue to struggle with reduced staffing and to grapple with the best way to employ cost-saving measures such as alternative fee arrangements without sacrificing the quality of their defense efforts. The survey is based on comprehensive interviews with general counsel or senior legal officers at 385 companies of all sizes and business types. The survey can be read in full here.

 
   
 
 
 

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