Duane Morris has announced the launch of a new tool to help clients with early assessment of litigation risks, strategies and alternatives.

Known as Dispute Navigation Analytics, the system uses proprietary software to project costs, calculate risk and reputational exposure, evaluate a prospective case's merits and foresee major events in potential litigation.

Complex litigation cases are reviewed for jurisdictional and technical issues-which might require a subject matter expert's input-after which the merits are analyzed.

Cases are fitted to one of various "templates" the firm developed, a cost estimate is produced and clients receive a detailed report.

The program was developed internally by information-technology staff.

It's "not the typical, old-school, back-of-the-napkin" kind of estimate, says Matthew Taylor, head of the trial practice group and an executive committee member.

The program was presented at the firm's annual meeting in Philadelphia on Oct. 26 and 27, and is being used in all the firm's offices among numerous practice groups, including litigation, employment law and intellectual property.

Clients are charged for the service. Costs vary widely depending on the complexity of the matter, but the task—like others at the firm—can be billed hourly or in a flat fee.

Development began more than a year ago, with partners and associates conferring with finance and IT staffers. Attorneys spent much of that time delving into 15 years' worth of case files.

The firm also assembled a committee of partners and staff to keep the system updated with information about new case resolutions.

The project was prompted by "our realization that clients are demanding it," Taylor says. "Clients, in these tough budgetary times, do not want surprises." In the past, there was no formal assessment process at the firm. Assessments were performed, but more cursorily and on an "ad hoc basis," perhaps by comparing the client matter in question with one or two other past cases, says Taylor.

Other firms offer early case assessment, but Duane Morris' isn't specifically modeled after another, he says.

"I didn't look at it...as we've got to keep up with the Joneses on some product," Taylor says. "I don't think it would be appropriate to say we have this bell and whistle on ours and they don't—because I don't know that."

But Taylor's sense is that "most firms don't have a real systemized approach to this," he says.

The assessment may steer clients toward the firm's arbitration, mediation and alternate dispute resolution practice, or could tell them to take a pass altogether.

"Any good lawyer has talked a client out of litigation," Taylor says. "We do that all the time," but before, "it wasn't systemized," he adds.

That approach doesn't necessarily hurt business, says Taylor, because many corporations seeking assessments already have retained Duane Morris as chief litigation counsel. Those clients can be relied on for long-term business, and helping them avoid cost keeps them happy, he says.

New clients, too, value the candidness, and are more likely to return the next time they are facing a legal issue, Taylor says.

According to an annual survey of 300 in-house lawyers by BTI Consulting Group Inc. of Wellesley, Mass., an uptick in litigation is expected in 2014, but costs are projected to stabilize in part because of the growing use of early case assessment.

The market research firm's report, released in September, notes that 38 percent to 41 percent of small- to mid-size companies' legal department budgets go to litigation.

"Most firms have some form of early case assessment," and with companies engaging eight to 12 firms before they pick one, "the more structured your approach, the more differentiated you're going to be," says BTI president Michael Rynowecer, who was consulted by Duane Morris around the time the program was launched.

In some firms, individual groups of partners might have implemented a small-scale program, but "there are very few that have rolled them out in this centralized way," Rynowecer adds.

Another survey of in-house counsel—released in May by Tampa, Fla.-based Carlton Fields, another consulting firm—found that early case assessment, along with other cost-saving measures, drove a 14 percent drop in the average per-case cost of class action defense in 2012—from $776,500 to $671,100.

About 14 percent of the lawyers surveyed identified early case assessment as the No. 1 risk-management measure, up from about 12 percent in 2011, the report says.

Reprinted with permission from New Jersey Law Journal, © ALM Media Properties LLC. All rights reserved.