Use of data in litigation
It is universally recognised that all sectors are realising the benefits of data, and that collating and analysing data (beyond mere financial data) can achieve great results in strategic decisions. Indeed, no major organisation would make a multi-million pound acquisition decision for example, without recourse to data.
Litigation – be it by practitioners, funders, General Counsels (GCs), insurers – is no different. However, litigation, thanks to the structural nature of the process, attracts a dataset that is the envy of other sectors.
If they are not already (and Bloomberg Law’s 2021 Legal Technology showed only c. 20%) litigators ought to avail themselves of the litigation-specific dataset. Material details of data in litigation are beyond the scope of this note, but litigators would be well-served to ensure data is actively considered in their decision-making. LCM is a vigorous user of a variety of data sources for all aspects of LCM’s investments and draws on a combination of our own carefully moderated data and that of leading data analytics platform, Solomonic.
What is data in litigation?
Litigators have public, and sometimes free or for-a-fee, access to a credible rich source material: court filings, the litigation lifecycle, and published decisions.
Human behaviour is, by definition, habitual and a thoughtful look back at past patterns of party behaviour and case outcome can yield a staggering set of datapoints. Prior judicial rulings are particularly valuable.
Data sets the context for a practitioner’s analysis, it anchors it to past outcome rather than just the personal experience of the practitioner, who no matter how extensive their expertise would not have been able to run every case in front of every judge in the past ten years.
This doesn’t detract from that experience; it adds to it.
By using these datapoints correctly, litigators become more proficient at forecasting outcomes of the litigation or interlocutory parts in it.
How is it relevant?
So, whilst the age-old practice of advising and litigating with established precedent is relevant, the use of datapoints in litigation is growing exponentially. And the use of the data is as varied as the data itself.
The relevance of the data will be defined by the litigator: a GC looking for a new firm to instruct will consider the track-record a law firm has in the sector or use the data to better manage board expectations on the likely outcome of a claim. Data can help boards become more comfortable with the risks involved.
The Chief Financial Officer will use data to estimate and provision for litigation-related cashflows.
A law firm may wish to consider which way data shows that the jurisprudential winds are blowing or make case-specific strategic decisions or change tactics.
A funder may wish to forecast how long its capital will be at risk or if data shows that its funded party typically attracts interlocutory applications.
Relatedly, data shows which law firms were instructed for which claims, meaning litigators gain market intelligence on opponents.
Ultimately, as it does in any other area of high value and high-risk decision-making, data and analytics bring an additional layer of insight and, used rigorously, enhance decision making.
What are the limitations?
There is a degree of jurisdictional specificity. Whereas some American states disclose which judge is to be assigned which case, English and Australian courts typically do not. This means that patterns in decision-making are visible to those in the appropriate jurisdiction.
Notwithstanding, any judge-specific intelligence that could be gleaned in any jurisdiction can of course be useful. It can also reveal the extent of the impact a judge or court may have on the outcome.
And there is a gap in access in so far as commercial arbitration forums. Those forums necessarily respect the confidentiality of arbitral claims (one of the key attractions of private arbitration) meaning data from those forums is missing.
The question is not ‘if’, the question is ‘when’.
The use of data by litigators is budding but growing rapidly. LCM has the benefit of proprietary data from 1998 but also access to a creditable commercial platform like Solomonic.
Data from Solomonic feature in LCM’s investment process and given the trajectory of growth of our market, are expected to feature more.
Data is critical to LCM, and it is carefully reviewed not only in relation to our risk assessment process but also for prognostication. Data provides us with important insights into performance, operations, markets, competition, and other areas.
