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Analytic tools for law department data – the Gini coefficient of concentration

Previously I have explored ways to depict and analyze law department data (See my two posts of Oct. 1, 2006 on graphics and visual techniques.). Other techniques of data exegesis are available for law department managers.

One statistical tool is the “Gini coefficient”, a measure of concentration. If the Gini coefficient were calculated for the concentration of litigation, a score of zero would mean all companies within the industry have the same number of lawsuits, and a score of one would mean a single company has all the lawsuits.

A fascinating study looked at 20 years of law suit data for about 2,000 of the largest U.S. corporations (Dunworth, Terence and Rogers, Joel, “Corporations in Court: Big Business Litigation in U.S. Federal Courts, 1971-1991,” 21 Law & Soc. Inq. 497, 531 (No. 3, Summer 1996). Within industries, the level of lawsuit inequality—one or a few companies facing the bulk of the litigation—is extremely high. For example, in Transportation/Communication, far more of the lawsuits tracked by this massive study befell fewer companies (Gini coefficient of .78) than in Food/Agriculture (a Gini coefficient of .52). This data has application in benchmarking projects and in self-assessments by law departments.

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