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Surge in litigation puts UK companies on defensive

More than three-quarters of UK businesses claim to have faced court action
over the past 12 months, with 84% saying they expect the number of legal
disputes to either stay the same or increase over the next year.

The 2006 Litigation Trends Survey published by law firm
& Jaworski
found that an emerging trend is that companies are spending
substantially more on dealing with regulatory enforcement issues – 58% of UK
respondents to the survey said that they have received a regulatory proceeding
in the past 12 months.

The research reveals a worrying increase in the amount of litigation faced by
UK companies: last year, just 66% of respondents said they faced a court action
compared with 78% this year. Perhaps even more worrying was the revelation that
the percentage of those respondents who faced more than 50 court actions tripled
from 5% to 15%.

According to Fulbright & Jaworski, the average large corporate incurred
litigation fees of $10.8m (£5.8m), an increase of more than 30% on last year’s
figure of $8m. “All companies have to face up to the challenge of working in a
complex regulatory environment and must ensure they are prepared to address
current regulatory issues and anticipate future regulatory changes,” says Lista
Cannon, head of European disputes at the firm.

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