Suits against companies trending down, research shows.

• Author: Marshall, Jeffrey
• Position: LITIGATION

The wave of litigation that crested a few years ago in the wake of massive frauds at Enron Corp., WorldCom Inc. and other celebrated cases is waning, according to new research from the international law firm Fulbright & Jaworski LLP.

Based on interviews with in-house counsel at 250 major U.S. corporations, 17 percent of respondents said their companies had escaped the past year without having to defend a single new lawsuit, up sharply from only 11 percent in 2005-06.

American corporations also appear to have backed off as plaintiffs--65 percent of respondents said their company had initiated at least one lawsuit in the past year, down from more than 70 percent a year ago and an even steeper drop from 2004, when 88 percent of U.S. companies said they had initiated litigation.

That litigation may have softened in recent months is evident on another front in the Fulbright survey: only 22 percent of in-house counsels said they expect to see the number of legal disputes their companies face increase over the next 12 months; a year ago, 33 percent said they were anticipating a rise in lawsuits involving their company.

Even the government seems to have lightened up a bit: 48 percent of companies reported some regulatory proceedings brought against them in the past 12 months, down more than 4 percent from a year ago. Internal investigations fell even more sharply. By contrast, U.K. companies have experienced significant increases in both categories.

To some degree, the drop in litigation can be traced directly to the troubles at storied plaintiffs' bar law firms like Milberg Weiss LLP. A federal grand jury has...