Facts & Figures: Litigation financing is here to stay

From patent trolls to shrinking law school classes, an inside look at the numbers that count

Terrible Trolls

According to a recent study by law professor Colleen Chien, more patent trolls than ever are emerging from underneath their proverbial bridges to wreak havoc on companies—particularly startups—despite the fact that they have no valid claim on technologies. In fact, this year for the first time, most patent lawsuits have come courtesy of these trolls. Read on for more survey results.

61% Percentage of patent lawsuits that were filed by trolls (through Dec. 1)

45% Percentage of patent suits that trolls filed in 2011

23% Percentage of patent suits filed by trolls in 2006

35% Percentage of startups that have raised between $50 million and $100 million that have faced a patent suit

Court Costs

It’s no secret that litigation is expensive, and in an effort to cover trial costs, some organizations have turned to third-party litigation financing. Supporters argue that it helps to level the playing field between companies with more resources and those with less; detractors say that it could pose ethical conflicts and drag out litigation. But love it or hate it, most litigators expect third-party litigation financing to grow in the next year and a half, according to a new survey from litigation financing provider Burford Group.

96% General counsel who are familiar with the idea of third-party financing

60% General counsel who expect third-party litigation finance to increase in the next 18 months

59% GCs surveyed who believe that it would legal the playing field between parties with unequal financial resources

38% General counsel who have worked on a case that could have benefited from litigation financing

Cutting Class

Finals time is fast approaching, but fewer aspiring attorneys will be hitting the books this term, according to a new survey from Kaplan Test Prep. More than half of U.S. schools reduced their class sizes for the 2012-2013 school year, largely because of the sad state of the legal jobs market. And the smaller class sizes aren’t the only difference at these schools: Institutions are also revising their curricula to give students more practical skills training.

51% Law schools that cut the size of their 2012 entering classes

63% Admissions officers who said the decrease is due to the contraction of the legal jobs market

28% Law school that will likely cut classes for the current application cycle

68% Schools that have modified their curriculum to make graduates more “practice ready”

Big Bonuses

Some lucky law firm associates don’t have to worry about getting a lump of coal this holiday season, as several major law firms have announced sizeable end-of-year bonuses over the course of the month. Continuing tradition, Cravath Swain and Moore was the first to reveal its numbers, setting a standard that most other major New York law firms are following.

Boies Schiller, however, broke out of the mold. The firm, which awards bonuses based on productivity rather than seniority, announced that some hefty checks will be coming associates’ way.

$60,000 Bonuses for Cravath’s senior-most associates, up from $37,000 last year (but down from $110,000 in 2007)

$10,000 Bonus amounts for junior associates, up from $7,500 last year

$250,000 Highest year-end bonuses at Boies Schiller, a $50,000 increase from the largest amount last year

$25,000 Lowest bonus at Boies Schiller

Pruning Partners

Enjoy your bonuses now, law firm partners, because a new study from Wells Fargo Private Bank suggests that more law firms than usual are planning to cull their partnership ranks come 2013. Most of the 115 firms surveyed do not plan to reduce partner numbers, but those that do often cited the problem of underutilized partners.

15% U.S. law firms that plan to reduce their number of partners in the first quarter of next year

1.2% Increase in equity partners at the surveyed firms this quarter

4% Increase in non-equity partners this quarter

-1.7% Decrease in number of hours equity partners billed in the third quarter, compared to the same period last year

Alanna Byrne

Bio and more articles

Join the Conversation

Advertisement. Closing in 15 seconds.