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Compelling Research. Compelling Results.©2015 The BTI Consulting Group, Inc. All rights reserved.
2016
BTI Litigation OutlookChanges, Trends and Opportunities for Law Firms
EXECUTIVE SUMMARY
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
ORDER THE COMPLETE REPORT NOW FOR MORE THAN 20 STRATEGIES TO WIN WORK AND
THE LAW FIRMS CLIENTS NAME AS BEST: www.bticonsulting.com/litigationoutlook
Litigation Outlook 2016: Turning Market Trends into Growth Opportunities
At the core of BTI’s research is a simple idea: Understanding how clients’ expectations are changing to help you grow and capture new market opportunities, take smart risks, and spur innovation. Fewer matters, increased spending, more complex work. These are 3 of the recent changes impacting how clients are approaching litigation—and how law firms will win business. BTI’s 5th annual series on trends in the litigation market uncovers how client behavior—and spending—is changing in 2016. However, the trends aren’t the point of this report; the opportunities are. Our goal is to help you create and provide solutions before clients realize they need them. And months (or years) before your competitors realize the same opportunities exist.
6 Trends Shaping Litigation in 2016 | 2 Client Spending on Litigation | 9 Litigation Forecast, by Specialty | 13 Industry Opportunities | 32 How Clients Use Law Firms for Litigation | 35 The Fearsome Foursome | 47 BTI’s Recommendations for 2016 | 49 Methodology | 53 About BTI | 55 Index of Firms | 60
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
6 trends shaping litigation in 2016 And more than 20 strategies to put into action. TODAY!
1. PRICES UP, VOLUME DOWN More high-rate work, but less work overall
2. HIGH-STAKES WORK SKYROCKETS
More premium work up for grabs
3. THE IP LITIGATION BUBBLE HAS OFFICIALLY POPPED
Less available work requires strategically targeting clients you want
4. CASE RESOLUTION A PATH TO MORE WORK
Clients looking to settle faster and earlier
5. GET AHEAD OF THE CLASS (ACTIONS)
The age of class actions is about to dawn
6. 4 LAW FIRMS CUT FROM CLIENT LITIGATION ROSTERS
Even entrenched law firms are on clients’ chopping block
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
1. PRICES UP, VOLUME DOWN
0
200
400
$15
$20
$25
$30
2011 2012 2013 2014 2015 2016(Projected)
Litigation Spending Total Matters
Billions Matters
IMPLICATION:
More high-rate work, but less work overall.
In 2016, litigation spending is expected to see its first increase since 2011. However, this uptick in the market doesn’t mean the market is returning to its former heyday. In fact, high resolution rates indicate fewer litigation matters will be on corporate counsel dockets. Fewer matters means fewer opportunities to be hired. Competition will be higher than ever to win litigation work. The upside: the firms able to snag the growth in premium work will see higher levels of spending per matter than before.
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
2. HIGH-STAKES WORK SKYROCKETS
Percent of companies with matter type
91.5%
84.5%
23.9%
91.2%
78.9%
12.3%
96.2%
78.2%
37.2%
0%
100%
Routine Complex Bet-the-Company
2013
2014
2015
IMPLICATION:
More premium work up for grabs.
Premium rate work is growing while overall matter volume is down. Bet-the-Company litigation virtually tripled and is heading higher. Law firms able to quickly assess—and articulate—the business implications (strategies, costs, time investments, likely outcomes, etc.) on high-stakes matters will be better positioned to win this work. See page 12 in the full report for additional recommendations on how to best position your firm for these high-rate matters.
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
3. THE IP LITIGATION BUBBLE HAS OFFICIALLY POPPED
Billions
$2.42
$2.81 $2.89 $2.89 $2.76 $2.72
$1
$4
2010 2012 2013 2014 2015 2016 (Projected)
19.3% INCREASE 5.7% DECLINE
IMPLICATION:
Less available work requires strategically targeting clients you want.
The rapid growth of the IP litigation market was just as quickly tempered. Risk-averse corporate counsel were swift to adopt proactive strategies and monitoring solutions to ensure the risk—and cost—of IP litigation didn’t upend their legal budgets. This means fewer IP issues are escalating into high-stakes litigation. A more strategic approach to managing IP litigation is needed if a firm wants to be in position to handle IP litigation for clients. See page 23 in the full report on how to best position your firm to capture premium-rate IP litigation cases.
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
4. CASE RESOLUTION A PATH TO MORE WORK
22.2%
36.9% 41.6%
36.5% 40.1%
47.8%
42.6%
0%
75%
2009 2010 2011 2012 2013 2014 2015 2016(Projected)
Percent of Active Matters Settled
IMPLICATION:
Clients looking to settle faster and earlier.
Attract the best clients by showcasing: streamlined early case assessment, smarter staffing arrangements, budgets (including adherence to them), and proactive settlement strategies.
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
5. GET AHEAD OF THE CLASS (ACTIONS)
Billions
$2.24
$2.06 $2.05 $2.03 $2.10 $2.14
$1
$3
2010 2012 2013 2014 2015 2016 (Projected)
8.7% DECLINE 5.5% INCREASE
IMPLICATION:
The age of class actions is about to dawn.
Class Actions are about to be big—extremely big. Certification reclassifications and increasing regulatory scrutiny have tempered Class Actions spending for the past few years. However, the talk of Class Actions becoming a global issue points to one trend: the recent decline in this spending area is about to reverse. Law firms looking to be a player in the Class Actions market will need to start laying the groundwork, today, with clients most at risk (see page 17 in the full report for a detailed look at class actions).
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
6. 4 LAW FIRMS CUT FROM CLIENT LITIGATION ROSTERS
IMPLICATION:
Even entrenched firms are on clients’ chopping block.
It just got a lot harder to win litigation work. In 2015, clients used 4 fewer law firms for their litigation needs than in 2014. The perfect storm of fewer litigation matters, higher resolution rates, and increasingly complex work drives corporate counsel to cap their roster of law firms used for litigation. See page 36 in the full report for more details on why complex work drives the use of fewer law firms and how you can ensure your firm doesn’t end up being cut.
Number of Law Firms Relied on for Litigation
17 18
20 21
17
0
30
2010 2012 2013 2014 2015
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
Methodology and Approach
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
Research Methodology and Approach
BTI Litigation Outlook 2016 is based solely on in-depth telephone interviews with leading legal decision makers. This comprehensive analysis trends data from more than 4,000 corporate counsel client interviews conducted over the span of 15 years. This research is independent and unbiased—no law firm or organization other than BTI sponsors this study. Each year, BTI reaches out to a sample of legal decision makers at large organizations with $1 billion or more in revenue. Participants are granted confidentiality at the individual and organizational level.
2016 SURVEY PARTICIPANT DEMOGRAPHICS
• Head of Litigation • Chief and Vice President of Litigation • General Counsel/Chief Legal Officer • Direct report to General Counsel
LEGAL DECISION MAKERS RESPONSIBLE FOR LITIGATION
322 in-depth telephone interviews Interviews
Conducted between March 9 and September 10, 2015 Time Frame
Respondents receive a complimentary report of legal benchmarks and metrics
Incentives
OVERVIEW
ORGANIZATIONS WITH HIGHEST LEVELS OF LEGAL SPENDING
$18.2 billion
$4.7 billion
Average Revenue Median Revenue
REPRESENTATIVE
OF MORE THAN 15
INDUSTRY SEGMENTS
Banking
Chemicals
Consumer Goods
Energy
Financial Services
High Tech
Insurance
Investment Banks
Manufacturing
Pharmaceuticals
Professional Services
Retail Trade
Telecom
Transportation
Wholesale Trade
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
About The BTI Consulting Group
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
Immediately Drive Growth with CLIENTELLIGENCE®
Pinpoint your strengths—and weaknesses— in the activities proven to drive growth
THE 17 ACTIVITIES DRIVING GROWTH
Quadrant I: Relationship Bliss 1. Commitment to help 2. Client focus 3. Understanding the client’s business 4. Providing value for the dollar
Quadrant II: Price of Admission 5. Legal skills 6. Quality 7. Meeting core scope 8. Keeping clients informed 9. Dealing with unexpected changes 10. Handling problems
Quadrant III: Relationship Builders
11. Breadth of services 12. Helping advise on business issues 13. Regional reputation 14. Unprompted communication 15. Bringing together resources
Quadrant IV: Business Magnets
16. Anticipating the client’s needs 17. Innovative approach
BTI’s 25 years of research pinpoint the 17 activities responsible for driving the absolute best client relationships. In essence, they are how clients define client service excellence and what clients expect out of the firms with whom they have the best relationships. The best-in-class performances in these activities are proven to drive superior financial performance. There’s only 1 way to determine if you are hitting the best-in-class threshold: ask. Client feedback allows you to unequivocally pinpoint where you are excelling and where you need systematic improvements in your relationships. The best feedback initiatives not only assess how you and your firm perform, but also look at the performance of the competitors also serving your clients. At the end of the day, what does it matter if a client thinks you are doing great, if a competitor is doing better?
LEARN MORE ABOUT THE 17 ACTIVITIES AND
BTI’S NEWEST BOOK: CLIENTELLIGENCE
www.bticonsulting.com/17
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
BTI dissects each and every aspect of the client experience through more than 14,000 independent interviews with C-level executives and systematic analysis. BTI has helped professional services firms boost client service for over 25 years. BTI is the leading provider of strategic research to the legal community—performing more market research about law firms than virtually anyone. BTI has helped more than 200 law firms and professional services firms improve client service through compelling research and advice. We conduct the only continuous benchmarking market study in the legal services industry, now in its 16th year.
Drive new business immediately
Keep competitors out of your client base
Find your strengths… and weaknesses
BTI conducts the most insightful, custom client surveys as
part of world-class client feedback programs to drive growth.
Clients use BTI’s fact-based approach and powerful
decision-making tools to drive change, create urgency, and
substantially boost performance.
USE BTI’S SERVICES AND RESEARCH TO:
Learn what clients really want from you
Who We Are
14
©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
BTI PERFORMS A BROAD RANGE OF SERVICES FOR OUR CLIENTS, INCLUDING:
CUSTOM CLIENT FEEDBACK RESEARCH
CLIENT SERVICE PERFORMANCE STUDIES
CLIENT NEEDS ASSESSMENT
BUSINESS DEVELOPMENT
STRATEGIC BUSINESS PLANNING
CLIENT-FOCUSED BUSINESS PRACTICES
CUSTOM TRAINING
BENCHMARKING YOUR PERFORMANCE
YOUR FIRM’S CLIENT SERVICE SCORE
FINANCIAL AND MARKET PERFORMANCE
COMPETITIVE ANALYSIS
MARKET ASSESSMENT
BRAND HEALTH & MARKET AWARENESS STUDIES
NEW MARKET ENTRY ASSESSMENTS
BTI CLIENT FOCUS BOOT CAMPS
HIGHLY TARGETED 3-4 HOUR SESSIONS—DESIGNED FOR SENIOR
PARTNERS AND ATTORNEYS
CLIENT INSIGHT BRIEFINGS
BTI ALSO OFFERS PRIVATE BRIEFINGS BOTH IN PERSON AND VIA THE
WEB. CHOCK FULL OF CLIENT-BASED INSIGHTS, PERSPECTIVES, AND
FACTS, BTI BRIEFINGS DRAW FROM OUR RESEARCH, EXPERIENCE, AND
OTHER RESOURCES TO PROVIDE PROVOCATIVE, CONSTRUCTIVE
INSIGHTS TO HELP YOU BOOST CLIENT SATISFACTION, INCREASE CLIENT
RETENTION, AND IMPROVE YOUR PERFORMANCE. WE CAN TAILOR OUR
BRIEFING TO INCLUDE SPECIFIC FEEDBACK ON YOUR FIRM.
PLEASE CONTACT MICHAEL B. RYNOWECER AT +1 617 439 0333 OR
TO LEARN MORE ABOUT BTI’S CUSTOM RESEARCH & SERVICES.
Key Services to Help Our Clients
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
The data and insight found in BTI’s reports are used to train attorneys, guide business development, inform strategy, and calibrate market trends against firm tactics. In short, you get many of the benefits of a custom study commissioned for your firm, at a fraction of the cost. These insights are proven to drive growth and client retention and protect fees. All of our reports come with a 100% satisfaction guarantee and complete telephone support to help you maximize the value from our publications.
You can order these and other compelling BTI research or publications at
www.bticonsulting.com.
BTI LEGAL SPENDING OUTLOOK 2016 – RELEASED OCTOBER 2016
BTI’s Legal Spending Outlook outlines how clients are changing their spending and use of law firms—by practice—in 2016. Learn how to use the distinctive characteristics of 17 different practice areas to target the best opportunities
for your firm and beat out competitors.
BTI CLIENT SERVICE A-TEAM 2016 – RELEASED NOVEMBER 2016
17 activities drive superior client relationships. 4 matter most. Discover how clients rate more than 300 law firms—by name—in these key activities, including Client Focus, Commitment to Help, Legal Skills,
and Provides Value for the Dollar.
BTI BRAND ELITE 2015
Based on why clients hire and recommend law firms—not the services, size, or location of a law firm—BTI’s research reveals how law firms of any size
reap substantial new business by improving brand perceptions in the market.
BTI CLIENT SERVICE ALL-STARS 2015
354 attorneys step up to meet—and exceed—clients’ expectations and earn recognition, by name, from corporate counsel for delivering
the absolute best client service.
Additional Insights from BTI Research and Publications
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
THIS COPY OF BTI LITIGATION OUTLOOK 2016 EXECUTIVE SUMMARY IS LICENSED TO YOU FOR PRIVATE, NONCOMMERCIAL USE FOR INTERNAL, COMPANY PURPOSES. NO PORTION OF THIS INFORMATION MAY BE COPIED OR TRANSMITTED IN ANY FORM, SHAPE OR MANNER WITHOUT THE PRIOR WRITTEN CONSENT OF THE BTI CONSULTING GROUP, INC., OF WELLESLEY, MA. ANY VIOLATION OF THIS LICENSE MAY BE PUNISHABLE BY APPLICABLE FEDERAL STATUTES AND SUBJECT THE USER TO ADDITIONAL AND COMPENSATORY LICENSING FEES. COPYRIGHT ©THE BTI CONSULTING GROUP, INC., 2015.
ADDRESS ANY QUESTIONS TO: THE BTI CONSULTING GROUP, INC. 396 WASHINGTON STREET, SUITE 314 WELLESLEY, MA 02481 +1 617 439 0333
Terms of Use
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
Please contact Michael B. Rynowecer, BTI President, at +1 617 439 0333 or at [email protected] with your questions, thoughts, and comments.
Contact BTI
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©2015 The BTI Consulting Group, Inc. All rights reserved. +1 617 439 0333 www.bticonsulting.com BTI Litigation Outlook 2016: Changes, Trends and Opportunities for Law Firms
FOR MORE THAN 20 STRATEGIES TO WIN WORK AND THE LAW FIRMS CLIENTS NAME AS BEST:
ORDER YOUR COMPLETE REPORT NOW www.bticonsulting.com/litigationoutlook
6 Trends Shaping Litigation in 2016 | 2 Client Spending on Litigation | 9 Litigation Forecast, by Specialty | 13 Industry Opportunities | 32 How Clients Use Law Firms for Litigation | 35 The Fearsome Foursome | 47 BTI’s Recommendations for 2016 | 49 Methodology | 53 About BTI | 55 Index of Firms | 60
The BTI Consulting Group, Inc.396 Washington Street, Suite 314Wellesley, MA 02481-6209
Tel: +1 617 439 0333Fax: +1 617 439 9174
www.bticonsulting.com