Litigation Trends in 2025: What Businesses Need to Know

The legal landscape continues to evolve rapidly in 2025, with businesses facing an increasingly complex web of litigation risks and opportunities. Understanding these emerging trends is crucial for companies looking to protect their interests and navigate the modern regulatory environment effectively.

The Current State of Business Litigation in 2025

Nearly half of corporate counsel expect the number of lawsuits and regulatory investigations impacting their organizations to increase in the year ahead, including a rise in legal disputes as plaintiffs seek to limit regulators’ authority, according to Norton Rose Fulbright’s 2025 Annual Litigation Trends Survey. This represents a significant shift in the litigation landscape that businesses must prepare for.

The foundation of these changes lies in technological advancement and evolving talent landscapes. AI, data management, and cybersecurity are no longer peripheral concerns. They’re central to how legal departments operate and how they select outside counsel.

Key Litigation Trends Businesses Must Watch in 2025

1. Cybersecurity and Data Privacy Litigation

Cybersecurity remains at the forefront of litigation concerns. More than a third (36%) of respondents in recent surveys identify cybersecurity and data privacy issues as ongoing challenges amid escalating cyberattacks, growing disclosure burdens, and uncertainty surrounding AI tools.

The implications for businesses are significant:

• Increased scrutiny on data breach response procedures
• Enhanced liability for inadequate cybersecurity measures
• Growing litigation around AI-driven data collection and processing

2. Artificial Intelligence and Technology Litigation

The AI revolution has brought with it a new category of legal challenges. Generative AI faced significant privacy-related litigation in 2024, with US companies encountering lawsuits and enforcement actions under various state and federal laws. This trend underscores the growing scrutiny of AI disclosures and the potential legal pitfalls for companies navigating this complex landscape. Combined with an evolving regulatory framework and rapid advancements in AI technology, the frequency of such cases may well continue to increase in 2025.

Key areas of AI litigation include:

• Intellectual property disputes over AI-generated content
• Privacy violations in AI training data collection
• Discrimination claims related to AI decision-making systems
• Securities litigation over AI capability misrepresentations

3. Financial Services and Payments Litigation

The financial sector faces unique challenges in 2025. Payments litigation will likely continue and increase in 2025 in the United States and globally, along with increased use of Automated Clearing House (ACH) transfers and wires, bank and non-bank competition, state regulation, and more sophisticated fraud schemes.

4. Supply Chain and Contract Disputes

Post-pandemic supply chain disruptions continue to generate litigation. Businesses are focusing on flexible contract arrangements: ensuring adaptability in supplier and vendor contracts to respond swiftly to changing business environments, while also managing compliance in emerging areas such as climate reporting and AI regulation.

5. Enhanced Compliance and Regulatory Oversight

Companies face increasing regulatory scrutiny across multiple fronts. The trend includes enhanced compliance oversight: managing compliance in emerging areas, such as climate reporting and AI regulation, to align with corporate governance goals.

Industry-Specific Litigation Trends

Healthcare and Life Sciences

• Telemedicine regulation disputes
• AI-driven diagnostic tool liability
• Data privacy in digital health platforms

Technology Sector

• Platform liability litigation
• AI ethics and bias claims
• Cross-border data transfer disputes

Financial Services

• Cryptocurrency-related litigation
• Regulatory compliance in fintech
• Consumer protection in digital payments

Manufacturing and Retail

• Supply chain disruption claims
• Product liability in smart devices
• Environmental compliance litigation

What Businesses Should Do to Prepare

1. Strengthen Cybersecurity Frameworks

Given the prominence of cybersecurity litigation, businesses should:

• Implement robust incident response plans
• Regular security audits and penetration testing
• Employee training on data protection protocols
• Clear breach notification procedures

2. Develop AI Governance Policies

As AI litigation increases, companies need:

• Clear AI usage guidelines
• Regular bias testing and auditing
• Transparent AI decision-making processes
• Proper documentation of AI system limitations

3. Review and Update Contracts

Modern contract management requires:

• Force majeure clauses that account for cyber incidents
• Clear data processing and privacy terms
• Flexible supplier arrangements
• AI-specific indemnification provisions

4. Enhance Compliance Programs

Effective compliance in 2025 involves:

• Cross-functional compliance teams
• Regular regulatory monitoring
• Industry-specific compliance training
• Documentation of compliance efforts

5. Invest in Legal Technology

32.40% of law firms expect investments in legal technology to increase, and businesses should follow suit by adopting tools for:

• Document review and e-discovery
• Compliance monitoring
• Contract analysis and management
• Risk assessment and reporting

Frequently Asked Questions About 2025 Litigation Trends

Q: What industries are most at risk for increased litigation in 2025?

A: Technology companies, financial services firms, and healthcare organizations face the highest litigation risks due to their heavy reliance on data processing, AI technologies, and regulatory compliance requirements. However, supply chain disputes and cybersecurity incidents affect virtually all industries.

Q: How can small businesses prepare for these litigation trends without significant legal budgets?

A: Small businesses should focus on prevention through basic cybersecurity measures, clear contracts with suppliers and customers, regular compliance training, and cyber insurance coverage. Many legal technology tools now offer affordable solutions for smaller organizations.

Q: What role does artificial intelligence play in both creating and resolving litigation?

A: AI creates litigation risks through privacy violations, bias in decision-making, and intellectual property disputes. However, it also helps resolve litigation through improved document review, predictive analytics for case outcomes, and more efficient legal research capabilities.

Q: Are there specific states or jurisdictions where businesses face higher litigation risks?

A: California, New York, and Delaware remain litigation hotspots due to their large business populations and specific regulatory frameworks. However, cybersecurity and data privacy litigation can occur anywhere, making geographic considerations less predictive than industry and business model factors.

Q: How should businesses handle AI-related disclosure requirements?

A: Companies should work with legal counsel to develop clear, accurate disclosures about AI capabilities and limitations. Avoid overstating AI functionality while ensuring transparency about how AI systems impact business operations and decision-making.

Q: What insurance coverage should businesses consider for emerging litigation risks?

A: Essential coverage includes cyber liability insurance, errors and omissions coverage that includes AI-related claims, and directors and officers insurance that covers regulatory investigations. Many insurers now offer specialized coverage for AI-related risks.

Q: How can businesses stay updated on evolving litigation trends?

A: Regular consultation with legal counsel, participation in industry associations, subscription to legal trend reports, and attendance at relevant conferences help businesses stay informed about emerging litigation risks and defense strategies.

Q: What are the most common mistakes businesses make when preparing for litigation risks?

A: Common mistakes include inadequate documentation of compliance efforts, failure to update contracts for new technologies, insufficient cybersecurity investments, and reactive rather than proactive approach to regulatory changes.

Q: How do international businesses navigate varying litigation landscapes?

A: International businesses should develop jurisdiction-specific compliance programs, understand local data privacy requirements, maintain relationships with local legal counsel, and implement standardized global policies that meet the highest applicable standards.

Q: What should businesses do if they’re already facing litigation in these emerging areas?

A: Immediately engage specialized counsel familiar with the specific area of law, preserve all relevant documents and data, assess insurance coverage options, and develop a comprehensive litigation strategy that addresses both immediate legal risks and broader business implications.

 Preparing for the Future of Business Litigation

The litigation landscape in 2025 presents both challenges and opportunities for businesses willing to adapt proactively. Success requires a comprehensive approach that combines technological investment, legal expertise, and strategic planning.

Companies that invest in robust cybersecurity, develop clear AI governance policies, maintain flexible contract structures, and build strong compliance programs will be better positioned to navigate the complex litigation environment ahead. The key is to view these preparations not as costs, but as investments in long-term business resilience and competitive advantage.

As litigation trends continue to evolve, businesses must remain agile and informed. Regular consultation with legal counsel, ongoing risk assessment, and proactive compliance measures will be essential for success in this dynamic environment.

The businesses that thrive in 2025 will be those that anticipate these trends rather than react to them, building legal resilience into their operational DNA from the ground up.