September 26, 2022

Litigation Risk Survey Finds Large In-House Workloads, Tight Resources and Missed Opportunities to Transfer Risk

Subscribe to Our Newsletter

Newsletter

Kevin Skrzysowski

|

September 26, 2022

Cover:

In-house legal departments say they are facing growing litigation burdens with limited staffing and financial resources—and yet most have not taken advantage of tools like risk transfer products to help manage workloads and ease budget uncertainty.

The 2022 Litigation Risk Survey, conducted by Risk Settlements in conjunction with In the House, asked general counsels and other in-house leaders around the globe about their litigation activities and legal spend, their tolerance for litigation risk, and their knowledge and use of the potential solutions available to help transfer the outcome risk of litigation.

The vast majority of in-house leaders—more than 80 percent—reported that their departments had 10 or fewer employees, and more than 70 percent said their legal budgets were less than $1 million. The results show that the size of the company and the size of the legal department do not necessarily correlate and provide further evidence that in-house lawyers and law departments are being stretched thin, particularly in the wake of the COVID-19 pandemic.

The survey also found that most in-house departments are bearing a substantial litigation workload. Three-quarters of respondents said they are currently defending active litigation, and 20 percent have 10 or more cases on the docket. Ten percent of respondents said they are fielding more than 50 active cases.

Perhaps unsurprisingly, given the tight budgets and small staffs, relatively few of the active cases are plaintiffs-side matters. Nearly half of respondents said they are currently pursuing no active affirmative litigation. And of the remaining respondents, the overwhelming majority are engaged in only a handful of plaintiffs-side matters.

In spite of their resource challenges, the majority of law departments have yet to take advantage of litigation risk transfer products. Most say, however, they are open to using them—particularly to gain greater budget certainty around costs. Two thirds of in-house counsel said they would consider using such products in their businesses in the future. This is especially true of products like litigation funding, adverse judgment insurance, and escrow release.

An effective claims monetization effort could assist GCs under pressure to transform their departments from cost centers into contributors to company profits. But less than a third of in-house leaders said their law departments are actively pursuing affirmative cases. If given the chance, however, nearly half—48 percent—would pursue claims if they were made aware of them, and 54 percent said they would be interested in pursuing affirmative cases regardless of the claim amount.

At present, most companies say they are attempting to locate affirmative claims themselves. Less than one-third are receiving help in identifying claims from outside counsel and only a handful are receiving the assistance of a litigation funder. The data suggests that companies should rely more heavily upon outside help to bring affirmative claims to their attention.

Nearly three-quarters of respondents said they were at least somewhat familiar with litigation funding. But only 5 percent say they have used funding themselves. In-house departments said they have identified funders primarily through referrals from business contacts. Half of the respondents reached out to funders directly or via funding brokers. Another third received referrals from outside counsel or were contacted by funders directly. An equal number of in- house counsel said the cost of funding and/or the structure of funding were the most important factors when choosing among funders.

Of the in-house counsel who have worked with a funder, the most common funding structure—used by 75 percent of respondents—was a contingency fee based upon the ultimate proceeds of a successful recovery. Hybrid structures, with claimants receiving funding via a combination of non-recourse loans and contingency fee arrangements, had also been used by two-thirds of respondents. Forty-four percent who have funded cases have arranged for a non-recourse loan, and 22 percent said they had used a recourse loan structure.

  • Legal Ops. Three-quarters of respondents said their companies did not yet have a legal operations team. And while much of the conversation in the legal industry has been about the role of legal ops in selecting outside counsel, respondents who have legal ops capabilities ranked outside counsel selection last among their key priorities. More important, they said, were finance, technology and strategic planning.
  • Litigation Risk. Fifty-four percent of respondents said they are “somewhat tolerant” of litigation risk. About a quarter of companies are “very tolerant” of risk. And a few—about 7 percent—say their companies are “extremely tolerant,” an answer that may suggest a few companies are leveraging affirmative litigation as a tool for revenue generation. Just over 16 percent—are “not tolerant at all” of litigation risk.
  • Outside Counsel. In-house lawyers surveyed said expertise in the litigation being defended is the most important factor in the hiring process for outside counsel. A prior relationship with the law firm (or their inclusion as panel counsel) ranks second, respondents said. While cost is a consideration, as is the law firm’s flexibility on fees, only 8 percent of in-house leaders said these issues were at the top of their list when making an outside counsel hiring decision.
  • Alternative Fee Arrangements. Alternative fee arrangements in litigation are occurring in about half (49 percent) of cases, the survey found. When they are used, AFAs are occurring more commonly in defense-side matters than in plaintiffs-side cases.
  • Liability Insurance. Companies commonly have commercial liability insurance, but it is rare for them to actually use it to cover litigation costs. By a wide margin, respondents said they relied upon insurance less than 10 percent of the time. Only one in four said they relied upon insurance policies to cover 50 percent or more of their litigation costs.
  • Assessing Risk. Assessing litigation risk remains a responsibility firmly in the hands of the general counsel, respondents said. Asked to rank the most important factors they use to assess risk in defense cases, in-house counsel said the “size of possible damages” and whether the matter is a “bet-the-company” case ranked first. The “likelihood of prevailing” in the case ranked second. When the company is considering bringing an action, however, the factors are reversed. By a wide margin, the likelihood of winning the case was the most important issue for in-house counsel when considering affirmative claims.

Responses to the 2022 Litigation Risk Survey came from in-house counsel in 20 countries, 37 U.S. states and the District of Columbia, and from more than 50 industry sectors.

< Older Post

Newer Post >

Certum Group Can Help

Get in touch to start discussing options.

Recent Content

Trade Secret Filings Just Hit a Record. Here's Why.

By Patrick Dempsey • September 1, 2026
This is the first post in Certum Group's seven-part series bringing our Trade Secret Litigation Playbook to the blog. It draws on Part I of the Playbook, Why Trade Secret Claims Matter Now. Read or download the full Playbook here . In 2025, federal trade secret filings reached an all-time high — roughly 1,551 new cases in U.S. district courts, up from 1,203 just two years earlier. 1 That is not a blip, and it is not a quirk of the docket. It is the visible edge of a structural shift in how companies create value and how easily that value now walks out the door. Trade secrets used to be the quiet cousin of the intellectual property family — patents got the valuation multiples, trademarks got the brand meetings. That era is over. For a lot of growth-stage companies, the trade secret portfolio can be worth more than the patents, copyrights, and trademarks combined. It rarely shows up on the balance sheet, and it is almost never insured against the risk it actually faces — which is not that someone will design around it, but that someone will take it. So it is worth understanding why the numbers are climbing, because each driver points to a specific exposure that a business owner can do something about. Employees move more, and faster The single largest source of trade secret disputes is not corporate espionage. It is ordinary talent mobility. Roughly 60% of misappropriation cases involve a departing employee, typically heading to a direct competitor. Tenure has shortened, remote work has normalized discreet cross-company job searches, and the volume of departures that touch sensitive information has grown accordingly. The prototypical case a decade ago was a sales rep leaving with a customer list. Today it is a design lead, a data scientist, or a process engineer carrying the company's hardest-won know-how — sometimes in a file, more often in their head. The cost of taking information has collapsed A USB drive, a personal cloud folder, an auto-forwarded email rule, a screenshot script — what once required filing cabinets and a truck now takes a few minutes. The technical friction that used to deter casual misappropriation is largely gone. That has two consequences. It makes the taking easier, and it makes the forensic trail richer: badge records, git commit histories, egress logs, and download timestamps now tell a story that is often more persuasive to a judge than any witness. The evidence exists. The question is whether the claim holder preserves it before it rolls off a ninety-day retention setting. AI has raised the stakes Machine-learning models are trained on data, code, and process knowledge that is frequently proprietary. Competitors racing to ship an equivalent product have a powerful incentive to shortcut the long, expensive path of independent development — and in software, life sciences, financial services, and advanced manufacturing, a six-to-twelve-month head start can be worth hundreds of millions of dollars. When the crown jewels are unpatented know-how, misappropriation is not a nuisance. It is an existential competitive event. Apple's 2026 trade secret suit against OpenAI — built around aggressive hiring from Apple's hardware teams — is only the most visible example of a pattern now playing out across the economy. A single, credible venue Finally, the law itself has changed the calculus. Since 2016, the federal Defend Trade Secrets Act has given claim holders a nationwide cause of action, federal discovery tools, and remedies strong enough to matter — including an extraordinary ex parte seizure procedure. 2 Enforcement is more predictable than it was under a patchwork of state statutes, and predictability attracts plaintiffs. It also attracts capital, which is where a firm like ours enters the picture. What it means for you From the underwriter's chair, the trend line is unambiguous: more valuable secrets, more mobile employees, cheaper theft, and a legal framework that rewards claim holders who move deliberately. The companies that fare worst are the ones that treated their secrecy program as a compliance checkbox and discover, only in a complaint, that it was the strategy all along. The companies that fare best have thought about identification, preservation, and enforcement economics before they ever need them. If your business runs on information other people would love to have, the record filing numbers are not abstract. They are a forecast. Go deeper with the Playbook. This post covers one piece of a much larger picture. For the full framework — what the law requires, what a strong pre-filing case looks like, how damages experts value these matters, how counsel fee structures change your economics, and how litigation finance fits in — read Certum Group's Trade Secret Litigation Playbook , our field guide for business owners and the counsel who advise them: certumgroup.com/the-trade-secret-playbook . And if you are evaluating a live dispute — or simply want to pressure-test what a matter is worth and how it might be funded — get in touch. A confidential conversation with Certum is free and carries no obligation, whether or not you ultimately seek funding. Reach us at certumgroup.com/contact-us . Sources 1. Lex Machina, Trade Secret Litigation Report (2026), reporting an all-time high in federal trade secret case filings in 2025; see also Lex Machina, Trade Secret Litigation Report (2024) (1,203 federal filings in 2023). 2. Defend Trade Secrets Act of 2016, Pub. L. No. 114-153, 18 U.S.C. Section 1836 et seq.

Will Marra Interviewed in Article on Third-Party Litigation Funding Disclosure Debate

By Certum Group Team • August 31, 2026
Certum’s William Marra was recently quoted in an article by MLex, a LexisNexis publication, on the widening debate over third-party litigation funding disclosure. “Litigation finance is the capital markets come to law,” Marra told the publication, emphasizing that funders are one of the few sources of capital available to an individual or small business facing a far larger opponent.  Responding to claims that litigation funding is a vehicle for foreign influence, Marra observed that “there’s just no evidence [of foreign influence] in the third-party funding space,” emphasizing that any real threat should be addressed through regulation covering foreign influence in litigation “in all of its forms.” The article also referenced Marra’s forthcoming New York University Law Review article on the third-party funding disclosure debate, which argues that any court-made disclosure rule should apply evenhandedly to all outside financing, and should not target only one form of third-party finance. “If you want to genuinely have a third-party litigation funding disclosure rule, then disclose all forms of third-party funding. Don’t just disclose the type of non-recourse litigation funding seeking money damages that is disproportionately used by poor individuals and small businesses.” The full article, Patent Litigation Drawn into Broader Third-Party Funding Disclosure Debate, is available here .

Apple v. OpenAI: How the World’s Most Valuable Company Is Using Trade Secret Law to Defend Its Competitive Edge

By Patrick Dempsey • August 18, 2026
On July 10, 2026, the most valuable company in the world accused the most talked-about company in the world of theft. Apple sued OpenAI in the U.S. District Court for the Northern District of California, alleging that OpenAI built its hardware ambitions on a foundation of Apple’s misappropriated trade secrets.¹ Few disputes touch as much of Certum’s Trade Secret Litigation Playbook at once: reasonable measures to guard a secret, identifying with particularity what was taken, and the human-centered points — recruiting and employee departures — where secrets actually walk out the door. Nearly every core theme in Certum Group’s Trade Secret Guide is in this case. And the lesson beneath it is worth sitting with: for the companies with the most to protect, trade secret litigation is not a last resort. It’s a front-line instrument of competitive strategy. Background The dispute sits at the intersection of two of the most closely watched storylines in technology. In 2025, OpenAI acquired io, the hardware venture founded by former Apple design chief Jony Ive and a group of other Apple alumni, for a reported $6.5 billion, and set out to build its first consumer hardware device, widely expected to compete directly with the iPhone.² To staff that effort, OpenAI hired aggressively from Apple. According to the complaint, more than 400 former Apple employees now work at OpenAI.³ Two of those hires anchor Apple’s allegations. Tang Yew Tan spent roughly 24 years at Apple, where he served as a vice president of product design responsible for the iPhone and Apple Watch, before becoming OpenAI’s chief hardware officer. Chang Liu spent about eight years at Apple as a senior systems electrical engineer before departing for OpenAI in 2026.⁴ Apple’s theory is not that a single rogue employee walked out the door with a file. It is that the movement of talent was accompanied by a coordinated effort, one Apple describes as operating “at every level," to extract and exploit the confidential information those employees carried in their heads and on their devices.⁵ The Allegations The complaint reads less like a garden-variety departure dispute and more like a catalog of the exact conduct the Trade Secret Guide warns companies to watch for. Among Apple’s central allegations: Apple claims OpenAI’s hardware leadership directed recruiters to use Apple’s confidential project code names during the hiring process, and instructed job candidates to bring “actual parts” and “CAD/design artifacts” to their interviews.⁶ It alleges that OpenAI circulated internal Apple documents marked “Need to Know” that coached departing employees on how to evade Apple’s exit-security procedures, including the “dreaded walkout,” and to alert OpenAI before signing their exit agreements.⁷ The specifics attributed to individual employees are what give the complaint its texture. Apple alleges that Chang Liu exploited an authentication bug to reach internal network storage after his access should have been cut off, messaging a colleague, “LOL, I found out I can access the [network storage], so funny,” and noting within hours of his departure that he “still ha[d] another computer.”⁸ And Apple alleges that io “exploited and used Apple’s secret, proprietary industrial design techniques,” misleading one of Apple’s own manufacturing partners about whether it was authorized to use a confidential metal-finishing technique.⁹ The trade secrets Apple says are at risk span the full arc of its product-development process: technical specifications for unreleased technologies, engineering presentations and prototype data, component and vendor selection processes, and the proprietary manufacturing techniques that turn a design into a shippable product.¹⁰ Notably, Apple’s opening ask is not a damages windfall. It is protection. Apple seeks to bar OpenAI from using or disclosing the information at issue, to compel the return of its confidential materials, and to preserve the evidence.¹¹ In other words, Apple is using the courthouse to do what its NDAs and exit interviews were supposed to do: keep its edge inside the building. OpenAI’s Response OpenAI has pushed back hard, and its answer is a preview of the fault lines any trade secret plaintiff should expect to fight over. On August 6, 2026, OpenAI moved to dismiss, characterizing the alleged conduct as “benign, lawful conduct” that Apple has mischaracterized, and arguing that its hardware executives simply followed standard industry recruiting practices.¹² As to Chang Liu, OpenAI contends he was “trying to help Apple” by assisting former colleagues who asked him to locate work information, not stealing anything.¹³ More pointed, and more instructive, is OpenAI’s argument that Apple’s own conduct undermines its case. OpenAI asserts that Apple allowed employees to use personal iCloud accounts for work and failed to properly revoke access when they left — noting that an Apple manager remained logged into Chang Liu’s personal iCloud account after his departure in order to transfer files.¹⁴ From that, OpenAI argues that Apple’s offboarding lapses created “confusion and unwanted access issues that Apple now characterizes as theft.” OpenAI also contends that Apple has not identified its trade secrets with adequate specificity, pointing instead to “generic categories of the product-development process.”¹⁵ OpenAI must file its full response by August 17, 2026, with oral argument on the motion set for October 1, 2026.¹⁶ Whatever the merits, OpenAI’s playbook is worth studying precisely because it is so conventional. Reasonable secrecy measures and identification of the trade secret with particularity are two of the elements every misappropriation claim rises or falls on, and they are exactly where a well-resourced defendant will apply pressure first. What This Means It is easy to read a case like this as celebrity litigation between two of the most valuable enterprises on earth. The more useful reading is that trade secret law has become core infrastructure for how modern companies protect competitive advantage. Apple did not respond to a $6.5 billion competitive threat with a press release or a patent portfolio. It responded with a trade secret complaint, because in a business where the crown jewels are unpatented know-how — manufacturing techniques, vendor relationships, unreleased designs — the Defend Trade Secrets Act and its state-law counterparts are the sharpest tools available. The case also throws the Trade Secret Guide’s central lessons into relief. The value of a trade secret program is only as good as the “reasonable measures” behind it; OpenAI’s opening move is to argue that Apple’s own iCloud and offboarding practices were not reasonable at all. The ability to describe what was taken, with specificity, is not a formality. It is frequently the whole ballgame at the pleading stage. And the human element — recruiting, exit procedures, the “dreaded walkout” — is where secrets actually leak, long before anyone reaches a courtroom. Companies that treat these as compliance checkboxes learn the hard way, in a complaint, that they were the strategy all along. For those of us who evaluate disputes for a living, Apple v. OpenAI is also a reminder of why high-stakes trade secret matters are among the most compelling on the plaintiff’s side. The conduct is often concrete and documentable, the competitive stakes are enormous, and, as the Federal Circuit’s recent decision in Versata Software v. Ford underscored, the damages framework can reach the full value of what the misappropriation delivered to the wrongdoer, not merely a discounted license fee. That combination is exactly what makes these cases worth pursuing, and worth backing. Apple’s complaint will be tested, as it should be, and the allegations remain just that — allegations. But the strategic signal is already unmistakable. When the most valuable company in the world wants to defend its future, it reaches for trade secret law. Certum Group’s Trade Secret Guide is built to help plaintiffs and their counsel do the same, whatever their size, and this case is a live illustration of why that playbook matters now more than ever. Certum Group can help. If you are evaluating a trade secret dispute or want to talk through options for funding or de-risking one, get in touch . Footnotes ¹ Complaint, Apple Inc. v. OpenAI, Inc. , No. 5:26-cv-07078 (N.D. Cal. filed July 10, 2026); see Apple sues OpenAI over alleged trade secret theft , TechCrunch (July 10, 2026). ² The wildest allegations in Apple's trade secrets lawsuit against OpenAI , TechCrunch (July 13, 2026). ³ Id. ⁴ Apple sues OpenAI over alleged trade secret theft , TechCrunch (July 10, 2026). ⁵ Apple sues OpenAI alleging trade secret theft, says scheme was "at every level," CNBC (July 10, 2026). ⁶ The wildest allegations in Apple's trade secrets lawsuit against OpenAI , TechCrunch (July 13, 2026). ⁷ Id. ⁸ Id. ⁹ Id. ¹⁰ Apple sues OpenAI over alleged trade secret theft , TechCrunch (July 10, 2026). ¹¹ Id. ¹² OpenAI Asks Judge to Toss Apple's Trade Secrets Lawsuit , Claims Journal (Aug. 7, 2026). ¹³ Id. ¹⁴ OpenAI says Apple's own security practices undermine its trade secrets case , TechCrunch (Aug. 6, 2026). ¹⁵ Id. ¹⁶ OpenAI Asks Judge to Toss Apple's Trade Secrets Lawsuit , Claims Journal (Aug. 7, 2026).