A change in presidential administrations always brings shifts for leading U.S. law firms. Corporate clients seek guidance on adjusting to new regulations and navigating evolving policy and business landscapes.
Tuesday’s election saw Republican Donald Trump secure a clear victory, giving the GOP a majority in the U.S. Senate and possibly the House of Representatives. Trump’s allies believe his economic vision received a strong mandate from voters.
Trump’s win is likely to have a significant impact on certain legal practices, especially in regulatory areas like energy, environment, mergers, investment deals, antitrust, employment, and tax enforcement. Peter Zeughauser, a law firm consultant, said, “Change generally benefits lawyers.” He added that the promise of aggressive deregulation would bring both uncertainty and opportunities for new economic activity, especially in regulatory practices.
Regulatory and Compliance Work
Trump has committed to rolling back regulations he views as stifling U.S. businesses. However, reducing red tape doesn’t necessarily mean a decrease in regulatory work for law firms. Dan Binstock, a partner at Garrison, a Washington-based legal recruiting firm, explained that uncertainty often leads to a surge in legal demand. “Whenever there’s uncertainty, the work spikes,” Binstock said.
Some states may fill the gap left by reduced federal regulation. Democratic state attorneys general frequently sued to block Trump’s policies during his first administration, while Republican counterparts have targeted policies under Democratic President Joe Biden.
As a result, law firms like Akin Gump Strauss Hauer & Feld, Hogan Lovells, Holland & Knight, and Wilmer Cutler Pickering Hale and Dorr have hired former state government lawyers and created dedicated practices to handle state enforcement matters.
Energy and Environment
Trump has pledged to make it easier for energy companies to drill on federal land and build new pipelines. Law firms with strong traditional energy practices stand to benefit from these changes. The U.S., already the world’s largest oil and gas producer, could expand production further if Trump dismantles Biden’s climate initiatives.
Despite Trump’s criticism of the Inflation Reduction Act (IRA), many experts believe it will continue to drive renewable energy investment. The IRA’s tax credits and provisions provide substantial opportunities for law firms specializing in energy and infrastructure. While Trump may attempt to repeal the IRA, Congress would need to act, and it’s unlikely that lawmakers would risk undermining clean energy investments in Republican-led states.
The first Trump administration saw a decline in federal environmental enforcement, but an increase in state-level enforcement and private environmental lawsuits. Many law firms, such as Kirkland & Ellis, DLA Piper, and Covington & Burling, have responded by creating environmental, social, and governance (ESG) practices. These firms help clients navigate new reporting requirements and activism around issues like climate change and corporate diversity.
Trump and his Republican allies are likely to fuel an existing backlash against ESG, generating more work for firms in this space.
Mergers and Acquisitions
Experts predict that M&A activity, which peaked in 2021, could slow under Trump due to policy uncertainty, trade wars, protectionism, and inflation. However, Trump’s economic agenda could ease constraints that arose under Biden, who took a tough stance on antitrust issues and blocked several major transactions.
Zeughauser noted that looser merger enforcement under Trump may encourage large-cap companies to pursue deals, which would generate significant work for lawyers across various practices, including regulatory, employment, litigation, private equity, and real estate.
Antitrust
Trump is expected to ease some of Biden’s aggressive antitrust policies. Experts anticipate he may abandon attempts to break up Alphabet’s Google over its search dominance, though he will likely target other Big Tech companies. Antitrust work could rise if Trump’s policies spark more dealmaking, but many expect the impact to be moderated by looser enforcement.
Trump’s administration may also scale back the tough stance on mergers that defined the Biden era, especially regarding settlements with companies facing antitrust challenges from the Federal Trade Commission (FTC) or the Department of Justice.
Employment and Immigration
Trump’s focus on cracking down on illegal immigration and reforming aspects of legal immigration could increase demand for legal services that assist businesses managing cross-border deals and foreign workers in the U.S.
Trump’s policies may also reverse changes made by the Biden administration’s National Labor Relations Board (NLRB), providing employers with more favorable conditions in labor disputes. Employment law firm Fisher Phillips highlighted that Trump would likely replace key NLRB personnel, benefiting employers in labor-related matters.
International Trade
Trump’s trade initiatives could bring additional work for law firms, particularly in international trade practices. His proposed tariffs on U.S. imports, which he claims would eliminate the trade deficit, could disrupt global trade flows. Critics warn that the tariffs would raise prices in the U.S. and contribute to global economic instability.
Many U.S. law firms have already adjusted their strategies for dealing with China. Several firms have closed their offices in China amid growing geopolitical tensions and economic uncertainties, signaling shifting priorities in international trade.
Financial Performance
Despite potential changes in administration, law firms are likely to maintain strong financial performance after a successful 2024. Kristin Stark, a law firm strategist with Fairfax Associates, stated that she sees no immediate signs of disruption from the election results. Stark added, “Thus far, we do not see a change in the administration/White House impacting that trajectory, and fortunately, we have likely averted disruption that would have come from a contested election.”
In summary, while Trump’s victory may introduce new regulatory and business challenges, it will also create new opportunities for law firms in various practice areas. Whether navigating deregulation, shifting trade policies, or evolving legal landscapes, firms are positioned to capitalize on the changes ahead.
