Analysis: Elite US firms attacked by Trump face a dilemma

Donald Trump’s second coming as president was always expected to make political waves, but few could have foreseen he would leave the legal profession in such tumult.

In the space of a few weeks, Trump’s administration has caused ructions within law firms, exposed the fragility of the sector’s diversity and equality commitment, and been accused of undermining the rule of law itself. While representative bodies rush to condemn, firms are stuck between satiating outraged younger associates and risking regulatory and financial penalties.

So far, their response has largely been to bury heads in the sand. But a panicky silence will not suffice forever.

Let’s first strip away the hyperbole and set out what Trump’s government has done. Three executive orders have been issued relating to the law firms Covington & Burling, Perkins Coie and Paul, Weiss, Rifkind, Wharton & Garrison LLP (known as Paul, Weiss). These orders – since challenged in US courts – restrict access to federal contracts and take away security passes for government buildings. Trump accused Paul, Weiss of hiring an ‘unethical attorney’ to manufacture a prosecution against him relating to the Capitol Hill riots in January 2021.

'Our legal system, and the rule of law, is in serious peril from attacks by the administration on lawyers who represent causes or people adverse to the administration. That is the foundation of our justice system'

Anthony Marks, Perkins Coie

The president went after Perkins Coie for ‘dishonest and dangerous activity’ in representing his 2016 presidential opponent Hillary Clinton and targeted Covington lawyers who advised Jack Smith, a special counsel appointed under the Biden administration who brought criminal charges against Trump.

The firms reject accusations of wrongdoing but have found precious little public support. The Gazette asked the top 10 US law firms for comment and has had no responses from any.

Within days of the Paul, Weiss order, it was reported that a high-profile client had fired the firm as its defence counsel. In a lawsuit challenging its order, Perkins Coie submitted that it had already lost or was at risk of losing at least seven clients and ‘significant revenue’.

Anthony Marks, a partner with Perkins Coie, said that this was lawyers’ ‘Spartacus moment’. He added: ‘Our legal system, and the rule of law, is in serious peril from attacks by the administration on lawyers who represent causes or people adverse to the administration. That is the foundation of our justice system.’

'I’m incredulous that the mightiest law firms in the land can be this feckless. Can they sit on the sidelines and watch a member of their brethren be destroyed?'

Vivia Chen, legal commentator

New York-based legal commentator Vivia Chen wrote that action against the 1,200-lawyer Paul, Weiss should be the tipping point for Big Law to take a stand, particularly as the president appeared also to be taking shots at pro bono work.

‘I’m incredulous that the mightiest law firms in the land can be this feckless,’ she added. ‘Can they sit on the sidelines and watch a member of their brethren be destroyed?’

But Trump was not done with just those three law firms. This week, the federal government’s US Equal Employment Opportunity Commission (EEOC) wrote to 20 practices requesting information about equality policies, expressing concerns that diversity and inclusivity initiatives may be unlawful. The letters chimed with Trump’s wider crackdown on DEI and no doubt caused palpitations in law firm boardrooms.

The president said: ‘My administration is committed to ending discrimination under “diversity, equity, and inclusion” policies and ensuring that federal benefits support the laws and policies of the United States, including those laws and policies promoting our national security and respecting the democratic process.

‘Those who engage in blatant race-based and sex-based discrimination, including quotas, but purposefully hide the nature of such discrimination through deceiving language, have engaged in a serious violation of the public trust.’

Again, there has been a dearth of public responses from the firms themselves, although there are reports that some have removed diversity and inclusion literature from their websites.

BCLP, a global firm not on the EEOC list, informed US lawyers in a meeting it would review its diversity and inclusion policy for the US. A spokesperson told the Gazette: ‘Equal access to opportunity and maintaining an inclusive culture are at the core of our values at BCLP. We will remain true to our commitment that firm values remain a top priority.’

The firm stressed that its approach to diversity reporting in the UK remains unchanged, and it appears likely that firms covering both jurisdictions will have to adapt policies depending on the country. This will inevitably attract accusations of hypocrisy – do you believe in diversity and inclusion or not? – but is not unprecedented, especially for firms who have offices in the Middle East where the laws on LGBTQ+ rights may be different. Firms are used to holding their nose where necessary and being pragmatic when it comes to minority rights issues in foreign territories; China, for example.

As one senior member of a major law firm told the Gazette: ‘It’s all very well asking us to take a stand but we’re a legal practice and we can’t actively pursue policies which the government has deemed to be unlawful.’

The danger with seeming to row back on DEI commitment is the message being sent to younger associates, who appear largely in favour of such policies.

Many spoke out on social media in response to the executive orders against firms and questioned why their bosses were not doing similarly. The ramping up of attacks on the legal sector appears to have emboldened those lawyers to express their outrage and dismay with employers.

More than 600 associates with the biggest firms operating in the US have signed an anonymised letter lambasting the Trump administration for ‘an all-out attack aimed at rule-of-law norms, including by censuring individual law firms by name because of past representation’.

The letter suggests that the government will target more large law firms until the industry complies and calls for a united front.

‘These executive actions coerce elimination of inclusive policies while leaving a pathway for the administration to intimidate firms out of taking specific clients,’ it adds. ‘They create a culture of fear and make our private-sector employers an extension of the executive, subject to penalties unless the president approves of their clients and arguments.’

Rachel Cohen, a Chicago-based finance associate who has promoted the letter, said she remained optimistic that the industry would coordinate and reject the Trump administration’s attempts to intimidate lawyers out of providing certain representation. ‘We are committed to the rule of law and continued representation of interests the administration believes are adverse’, said Cohen, speaking in a personal capacity. ‘We’ve tried silence, and it doesn’t seem to be working.’

The representative bodies have uniformly censured Trump and his government for their approach. The American Bar Association said the president was attempting to undermine the courts and the profession. The International Bar Association expressed ‘deep concern over the ongoing erosion of the rule of law’ in the US.

A total of 18 law organisations, including the Law Society of England and Wales, issued a joint statement urging the US government to rescind the executive orders and immediately halt all acts of intimidation, hindrance or harassment of legal professionals.

‘Lawyers must be able to represent their clients without fear of retaliation and must not be punished because of who their clients are,’ the statement says. ‘The independence of the legal profession is fundamental to ensure respect for human rights and is a crucial element of the rule of law.’

All of which may be laudable but highly unlikely to stop Trump. Indeed, the chances are that firms are going to come under further pressure to toe the line with the White House agenda on issues such as ESG and in particular their approach to climate change. Washington cancelling sanctions against Russia might also put UK/US firms in a difficult position, as could anything that upsets the framework for data transfers between the US, UK and the EU. Existing decisions on this remain in place until June 2025 but there remains uncertainty about the flow of data after that.

The focus on the legal sector and its individual firms is likely to intensify, and Trump will hardly be deterred by moralising legal organisations urging him to think of the rule of law. Firms not directly affected have looked the other way so far, but such a stance cannot last – not least because they might very well be next.

 

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