Preventing Litigation

Chapter 4

Preserving Assets

Companies and business organizations around the country have complained, year after year, about the cost of litigation, but to our knowledge no one’s ever done the calculations. What’s the cost of an average commercial (not automobile accident) lawsuit, per case, per company, and per year? As a percentage of costs, or profits, or losses? What’s it worth to prevent that lawsuit?

This chapter presents a combination of data sets1 to derive an average litigation cost per case, and the other metrics we’ve mentioned. The first results were staggering, so we present those knock-your-socks-off numbers up front:

• The cost of commercial tort litigation for the 10 years from 2001–2010 (rounded) is about $1.6 trillion ...