April 12, 2025 • 37 mins
June Grasso talks to legal experts David Super, a professor at Georgetown Law, Leon Fresco, a partner at Holland & Knight and Justin Henry, Bloomberg Law reporter, about the top legal stories of the day.
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Speaker 1 (00:02):
This is Bloomberg Law with June Grossel from Bloomberg Radio.
Speaker 2 (00:08):
Our March twelfth, my husband, Kilmer was abducted and disappeared
by the Trump administration.
Speaker 3 (00:15):
Kilmer Abrego Garcia was living in Maryland with his wife
and three children when immigration authorities arrested him and flew
him to prison in El Salvador. Under a twenty nineteen
court order, Garcia cannot be deported to his native country
of El Salvador because he's likely faced gang violence there.
This ould call administration error has destroyed my family's happiness.
(00:41):
The Trump administration admits that it made a mistake, but
argues it can no longer do anything about it. On Thursday,
a unanimous Supreme Court ordered the administration to take steps
to bring Garcia back. My guest is Leon Fresco, a
partner at Holland and Knight and the former head of
the Office of Immigration Litigation in the Obama administration. Leon,
(01:03):
the order here was just three paragraphs long. Tell us
about it.
Speaker 4 (01:07):
At the end of the day. What the Supreme Court
is saying is there was an agreed administrative error here.
So since there was an error, and this person clearly
has been now stipulated on all sides as an individual
that should not have been removed to El Savador because
he had this order called withholding of removal that prevented
(01:28):
his removal too, specifically El Salvador, that this person has
to be brought back, that that injunction that was issued
by the District Court is correct. But the question is
what does it mean that the government has to quote
unquote facilitate the return as opposed to effectuate the return.
And that's really going to be I think a dockdown,
(01:52):
drag out issue that's just going to come right back
to the Supreme Court.
Speaker 3 (01:55):
So technically the Supreme Court didn't order his return.
Speaker 4 (02:01):
This is what is very complicated about this decision is
that the Supreme Court basically gave a thankless task to
the District Court judge because it said that, yes, the
government needs to act to do what it can to
bring back mister Abrago Garcia to the United States, but
(02:23):
it's said within the proper constitutional limits of the court.
Here is the exact line. It says, the District Court
should clarify its directive with due regard for the difference
oh to the executive branch in the conduct of foreign affairs,
and then it says, for its part, the government should
be prepared to share what it can concerning the steps
(02:46):
it has taken and the prospect of further steps. So
it's trying to align itself with the concurrence of Judge Wilkinson's,
the conservative judge in the Fourth Circuit saying there is
an ability for the government to facilitate the return of
mister Abrago Garcia, but what it can't do is issue
(03:09):
these sort of global injunctions ordering al Salvador to do anything,
or ordering the United States government to order al Salvador
to do things. So this is going to be very
complicated because unlike a normal deportation case where the government
has been able to bring people back when there's a
(03:31):
dispute about their custody, here the Trump administration is saying,
this person is in Alsavador, end of story. We cannot
order President bucel to do anything. And so this is
going to be protracted litigation. In mind you that's going
to go right back up to the Supreme Court, because
you're going to have the district judge say bring them back,
(03:52):
and you're going to have the Fourth Circuit say what
is said again? And you're going to have the Supreme
Court has to deal with Look, is this prison really
in the control of the US government or is it
something where it's really in the control of Alsavador and
the US government can't do anything about it.
Speaker 3 (04:09):
Despite the complexities, this is a unanimous decision by the
Supreme Court in an immigration case.
Speaker 4 (04:17):
It is a Nino decision, and any nine oh decision
in immigration is very, very very surprising. You even have
Justice Alito, who almost never rules against the Department of
Justice on immigration, now sign out with a concurrence where
you have the three justices sort of my yor Kagan
and Jackson saying you have to bring this person back.
(04:38):
End of story. You've brought people back in the past,
bring this person back. And they're sort of anticipating what's
going to happen, which is that this case is coming
right back to the Supreme Court. I've actually seen already
tweet from the Trump administration saying, what do you want
us to do? This person is in Alsavador, they belong
(04:59):
to alpha it or end of story, we can't do anything.
We've won this case.
Speaker 3 (05:04):
You may be right, because it's already very contentious in
a hearing on Friday, the Trump administration lawyer refused to
tell the judge what the government is doing to bring
Garcia back or even where he is. Judge Paulsenese asked, quote,
this is a direct question, where is he an under
(05:24):
whose authority? And the answer from Justice Department lawyer Drew
Enson was, we are still internally reviewing the Supreme Court's
decision and vetting what we can say to this court.
So no answer is there.
Speaker 4 (05:37):
I mean, I'm sure the district court is going to
say this person is in the effective control of the
US government, because there's no way that El Salvador would
refuse to return this person back to the US if
the US insisted. But the question is, by the time
this case gets back up to the Supreme Court, is
(05:57):
the Supreme Court actually going to take the step of
saying that this person is really effectively, for all intensive purposes,
in US custody or are they going to allow this
sort of separation to exist in the legal sphere and say, well,
they're in Alsavador, they're in a Savadoran citizen, and they're
(06:20):
under the detention of the al Savadoran government. What really
can you force the US to do in this situation.
You want them to go to war or something to
bring this person back. That's not something a court can do.
And so this case is long but over.
Speaker 3 (06:37):
I mean, in the past, the government has brought people
back who've been wrongly deported to foreign countries.
Speaker 4 (06:45):
Yes, this happens dozens of times per year. There's many
times not even reported judicial decisions, because what will happen
is the appellate courts won't issue us stay in a case,
and then by the time the government actually starts briefing
the case, they realize the person had been removed and
they say, oh, boy, probably we shouldn't have done this,
and the person comes back. So that happened all the time.
(07:08):
The difference here is twofold. One. You have an administration
that for the first time is contesting this that they
even have the legal ability to bring someone back. So
you've never had that before. You've always had administrations that
are amenable to bringing people back. This is the first
one that isn't. But then secondly, this is the first
(07:28):
time that you have a foreign national literally in the
custody of the country to which they were removed. And
so that's a whole new set of facts. If that
government had some interest in actually having that person in custody,
that would be quite the issue. Now, what makes this
(07:48):
even a higher level of complexity is this was literally
the exact time that the person got released for, which
is that they said, if I get supported to Al Salvador,
I will be persecuted by the government and said to
some terrible confinement facility where I will be tortured and
possibly killed. And so this person is literally living the
(08:10):
manifestation of the thing that they were given relief for
not to happen. So I cannot say how complicated this
is now.
Speaker 3 (08:20):
This decision came two days after another immigration decision, where
the court ruled that the administration can keep using the
Alien Enemies Act, a wartime law, to deport alleged Venezuelan
gang members, but that the administration has to give the
detainees notice and a chance to be heard.
Speaker 4 (08:40):
So the Supreme Court said that the government can use
the Alien Enemies Act at the moment to try to
begin a process of defortation, but that people have a
right to challenge in habeas a whether you can actually
own the merits use the Alien Enemies Act. So yes,
(09:01):
they can begin this process, but can the Alien enemies
actually be used. But what I mean by that is
usually the Alien Enemies Act is invoked in the time
of war World War one, World War two, et cetera.
This is the first time it's being invoked for the
principle that there is a group of people who've committed
some sort of informal incursion in the United States for
(09:23):
the purposes of destabilizing the country, which is this Venezuelan
gang trend that raduas. So that's one analysis. Can it
be used for an informal gang as opposed to during
an actual declared war? They want the lower courts to
hear those arguments and flesh out from logic here before
it gets to the Supreme Court. That's number one. But
(09:45):
then number two is, even if it can, does the
person have the right to say, yeah, but I'm not
a member of this gang. I'm from Cleveland, for instance,
Why are you deporting me to El Savador or Venezuela
or anywhere else? Even I'm a Venezuelan hairdresser that's never
set foot in a gang, you know. And so now
(10:06):
there is an established Supreme Court decision that says, yes,
in habeas you get to make this argument, and also.
Speaker 3 (10:12):
The detainees have to file the havieas and the jurisdiction
they're being held in, which is happening already.
Speaker 4 (10:18):
So the ACLU went and filed habeases in New York
and in the southern districts of Texas, and immediately there
were two stays of deportation issued, both blocking the removal
and both under the ground that the plaintifs were likely
to succeed in their habeases, saying that the alien enemies
that could not be used to accomplish the type of
(10:42):
deportation that the government wanted the normal immigration court removal process.
This is going to be a very interesting process that
I think will also get to the Supreme Court about.
There's sort of two layers of briefing. There's one are
you subject to the alien enemy's acts as it were?
Meaning are you actually one of these trend to a
(11:04):
Agua gang members? But there's a second, which is should
this thing even apply? And should you actually just go
to immigration court and be able to make any defense
that you want and not be subject to this special
type of hearing. So there's both kinds of analyzes, and
the courts may need to do both, and we'll see
(11:25):
what ultimately works its way up to the Supreme Court.
As a result of.
Speaker 3 (11:28):
This, this administration is certainly keeping the Supreme Court busy.
Thanks so much, Leon. That's Leon Fresco of Holland and
Knight coming up next on the Bloomberg Law Show. Are
Trumps Supreme Court victories more about procedure than substance? I'm
June Gross. When you're listening to Bloomberg. President Trump is
(11:49):
turning to the Supreme Court over and over again as
lower court judges rein in his efforts to push the
limits of executive power, and the court's conservative majority seems
to be accommodating him with narrow winds that allow his
administration to move forward with his agenda deporting alleged Venezuelan
gang members, halting teacher grants, and firing federal workers. Is
(12:13):
it any wonder that liberal Justice Sonya Soto Mayor, who
dissented and all these administration wins, recently expressed concerns about
the rule of law.
Speaker 2 (12:23):
One of the things that's trumbling so many right now
is many of the standards that are being changed right
now were norms that government that governed officials into what
was right and wrong. Once norms are broken, then you're
shaking some of the foundation of the rule of law.
Speaker 3 (12:45):
Trump has been touting these victories, but a close look
shows their wins based on procedure rather than on the
merits more form over substance. My guest is constitutional law
expert David super, a professor at Georgetown Law. David, if
my calculations are correct, the Trump administration has made ten
(13:05):
emergency applications to the Supreme Court in less than three months.
I'm sure that's a record. But why is the Supreme
Court addressing so many of these issues?
Speaker 5 (13:17):
Well, the Trump administration is making sweeping changes in our
system of government, changing things that have been understood at
least since the New Deal, in many of them since
the founding. So these are important enough issues to merit
the Supreme Court's attention when they are enjoyed for being unlawful.
Speaker 3 (13:40):
So last Friday, the Supreme Court allowed the Education Department
to withhold money for teacher training projects in eight states.
It was a five to four decision to Justice John
Roberts sided with the Court's three liberals who would have
turned Trump down. Do you see why is with the
Court's liberals in that particular.
Speaker 5 (13:59):
Case, because he didn't write an opinion and he didn't
sign the opinions written by the liberal justices. So my
sense is that he simply didn't feel that the administration
had made a sufficiently compelling case, and he wasn't entirely
persuaded by what the conservative majority wrote in their opinion.
Speaker 3 (14:19):
So did the conservative majority basically go off on a
procedural point.
Speaker 5 (14:24):
Yeah, many of these cases are procedural. The majority is
looking with a very powerful magnifying glass at the procedure
and in particular about which court something is filed in,
and are in three of the most significant cases finding
(14:45):
that they don't believe it was in the right court.
That says nothing about the merits if the cases get
refiled in the court that the Supreme Court prefers. So
I don't think we can read very much into it
other than that this court is hoping, against hope that
if they give the administration a little more time, that
it will come into compliance.
Speaker 6 (15:06):
With the law.
Speaker 3 (15:07):
Justice Katanji Brown Jackson, in a disense, said it was
beyond puzzling that a majority of justices conceive of the
government's application as an emergency. I mean, it doesn't appear
that there's a real emergency in most of these applications
to the court.
Speaker 5 (15:23):
Now it doesn't. There's no indication that funding these teacher
training programs would do any devastating harm. But everything the
administration does these days, it claims is an emergency. And
their basic theme is that they get to define what
an emergency is, no matter how absurd that claim is.
(15:48):
And for the moment, the Supreme Court is humoring them
on this. My sense is that that game will only
work for so long.
Speaker 3 (15:56):
In probably the most high profile of these emergency petition
on Monday, the Court allowed Trump to continue deporting Venezuelan
migrants to prison in El Salvador under the Alien Enemies Act,
granting an emergency request on a five to four vote
without deciding if he was using that law lawfully.
Speaker 5 (16:18):
Yes, they said that that case should not have been
in the district of the District of Lumbia, should have
been in the southern District of Texas, and the reasons
for that are not silly, but not very compelling either.
There certainly were plausible reasons to have filed the case
where they did, but I think they're hoping that if
(16:41):
they make the case start all over again in the
Southern District of Texas as the administration will chalk that
up as a whin and back off from its absurd policy.
Speaker 3 (16:50):
They also didn't address the fact that hundreds of Venezuelan
migrants have been shipped to l Salvador already and are
in prison there a harsh prison, and Bloomberg News found
that just seven out of the two hundred and thirty
eight migrants have been found guilty of serious crimes. I mean,
(17:12):
they're sending people there based on tattoos and the kind
of clothes they're wearing, and the court just let that
go by.
Speaker 5 (17:20):
Well, the court said that there wasn't jurisdiction in the
district of Columbia, so they haven't said this is okay.
They have instead insisted that all that he's be crossed
and all the eyes be dotted before a court takes
action on this. Jurisdiction is one of the fundamental attributes
(17:40):
of courts, and they do need to attend to their jurisdiction.
On the other hand, past courts have been willing to
resolve close questions on jurisdiction in favor of getting justice done.
And here five members of the Court were not willing
to do that.
Speaker 3 (17:57):
Again, it was five to four, but this time Justice
aims Cony Barrett joined the liberal justices any accounting for
sort of the Chief and Justice Barrett switching positions in
these two cases.
Speaker 5 (18:09):
I think that both cases, the majority's argument was tenuous,
and it wasn't enough to persuade the Chief in the
first instance, and it wasn't enough to persuade Justice Barrett
in the second instance. Both are signaling that they are
not rubber stamps for the administration. But both of them,
(18:30):
I think are also signaling that they would like to
give the administration a chance to come into compliance on
its own. How long their patients will last remains to
be seen.
Speaker 3 (18:43):
Then, on Tuesday, in the first mass firing case to
reach the court, the justices bolstered Trump's campaign to fire
federal workers, blocking a judge's order that required the administration
to reinstate employees. So this was seven to two, with
Justices Sotomayor and Katanji Brown Jackson dissenting again based on procedure.
Speaker 5 (19:05):
Yes, the argument was that these cases should have been
brought initially through the merit system's civil service process and
resolved there rather than in federal court if there have
been one individual person fired based on a quibble over
whether they were taking too much sickly, absolutely, the merit
(19:27):
system's process would be the right place. When it's being
done as a matter of policy on a mass basis
without any consideration of individual circumstances, an injunction seems more appropriate.
But here the court decided to again insist on jurisdictional perfection.
Speaker 3 (19:46):
Is the majority sort of checking the easy way out
in these cases by making it more about procedure than
about the merits or the administration's policies.
Speaker 5 (19:56):
Oh, yes, very much. So you're not seeing opinion endorsing
what the administration has done. That would be very easy
for them to write either as an opinion of the
court or as a concurring opinion from Justice Alito or whomever.
And you're just not seeing that. You're seeing nitpicking on jurisdiction.
So no one is sending the administration signs that what
(20:19):
it's doing is okay. And I think if the administration's
lawyers are paying the least bit of attention, they will
recognize that they're being given time but absolutely no encouragement
on the merits. If the administration's lawyer, is there any
good they're telling them behind the scenes that you're dodging
a bullet here and dodging a bullet there, but that
(20:41):
the silence of even the most conservative justices on the
merits of your action is quite definite. And once the
plainness follow the instructions of the court as to how
to obtain jurisdiction, the court is giving the administration no
encouragement that it will get support on the merits.
Speaker 3 (20:59):
On Thursday, Trump went to the Supreme Court after the
full DC Circuit Court of Appeals reinstated to independent agency
officials who had been fired by Trump without cause, and
the Chief Justice put that DC Circuit Court decision on hold,
so the fired workers remain fired. Does Roberts action indicate
(21:22):
support for Trump's efforts to remove any limits on his
power to hire and fire.
Speaker 5 (21:29):
That's not clear. The Chief Justice has previously daid actions
of lower courts and then turned around and voted against
the administration on the merits, So at the moment, all
we could assume is that this stay is an indication
that he thinks that all the justices ought to be
able to weigh in, which is sensible enough on an
(21:50):
issue of this scale. On the other hand, the question
of independent agencies may be a more complicated one in
the court because several justices have indicated that they don't
like independent agencies or don't believe that their independence is appropriate.
So on this one, it's certainly is possible that one
all is said in times, the administration will succeed in
(22:12):
changing constitutional law. I don't like the administration's chances on
most of the others.
Speaker 3 (22:17):
Now, on Thursday night, the Supreme Court handed the Trump
administration a high profile defeat when a unanimous court ordered
the administration to return to the United States a man
who had been deported to l Salvador because of an
administration error. Where does that decision fit in this puzzle.
Speaker 6 (22:37):
Well, I think it suggests that the Supreme Court has
its limits, and it's telling the administration that we've now
got two unanimous decisions in the scope of a week
regarding sending people overseas. The first one found the procedural
fault with the case that had been brought, but said
(22:57):
that everybody has to be given notice and a chance
to ask for a hearing before they can be sent overseas.
And then for this gentleman who was sent overseas without
any process at all and contrary to law. They've now
unanimously told the administration to get him back. That suggests
(23:17):
that the Court is trying to give them space, trying
to give them leeway, but when it sees serious abuses,
it will step in.
Speaker 3 (23:27):
And why was it important that this was unanimous.
Speaker 6 (23:32):
It's important because this administration has already shown that it's
not very concerned about violating court orders. It's violated many
lower court orders. And I suspect that the justices were
concerned that if there was a split decision from the
Supreme Court, the administration would seize on that to refuse
(23:53):
to comply. As well, during the desegregation era, the Supreme
Court worked very hard to achieve unanimity, even if the
decisions that they wrote weren't as sweeping as they would
have liked, just because there was concern that many people
were disregarding the opinion. Similarly, in the Nixon Tape's case,
was unanimous with the Chief Justice writing the opinion, even
(24:17):
though many of the justices would have preferred a stronger opinion.
Unanimity was more important.
Speaker 3 (24:23):
This has been a fascinating discussion Thanks so much, David.
That's Professor David Super of Georgetown Law coming up Trump's
war on big laws, bringing in close to a billion
dollars in free legal services. I'm June Grosso and you're
listening to Bloomberg. President Donald Trump's unprecedented attack on big
(24:43):
law is yielding him hundreds of millions of dollars in
free legal services as many of the top Wall Street
firm's cave and settle with the administration, some even before
they've been targeted in an executive order we signed with
many law firms, the ones that we thought were inappropriate,
(25:03):
inappropriate seeming to mean their lawyers acted against Trump, his policies,
or his allies in some way. These executive orders generally
require that security clearances of a firm's lawyers be suspended,
that federal contracts be terminated, and that employee access to
federal buildings be restricted. While some firms have chosen to settle,
(25:27):
others have chosen to fight Trump in court, where judges
have already found his executive orders likely unconstitutional. So why
does one firm settle while another litigates? Here to tell
us his Bloomberg Law reporter Justin Henry justin how would
you describe the firms that are settling.
Speaker 1 (25:47):
So, the firms that we're seeing settle are primarily concentrated
in New York. I think all of them are headquartered
or at least originating from New York and have real
Wall Street pedigree. They're also much more wealthy, and a
lot of that wealth has come from their rainmaker transactional practices,
so corporate deals involving mergers and acquisitions and private equity.
Speaker 3 (26:10):
And explain why the firms that do transactional work want
to settle with Trump.
Speaker 1 (26:15):
So my understanding is that they have really sensitive client relationships,
clients who are very averse being in kind of the
political limelight. Some of those firms have client relationships that
are worth one hundred million dollars a year in revenue
or more. And those are client relationships that could vanish
literally overnight if their lawyers can't represent them in front
(26:39):
of government agencies or get the same kind of attention
from regulatory agencies to put the deals through. And then
that in a matter of days could decrease the overall
profitability of the firm, which would have a cascading effect
on other partners at the firm. Making lesson profits and
then also being vulnerable approaching by other firms. So you
(27:00):
could have a phenomenon that resembles the kind of run
on the bank.
Speaker 3 (27:03):
So they're even afraid that their partners will abandon them exactly.
Speaker 1 (27:08):
Yeah, and not for any individual lawyer's sort of decision
making on the process. It's really a coordination issue where
you know, they might want to stay with the firm,
the clients might want to stay with the firm, but
just because of business reasons, not because of political reasons.
There's no shortage of other firms looking to scoop up
that business, and they can come to them and say, hey, listen,
(27:30):
we're not in the negative limelight of the president. Come
to us. We still have a good relationship with the administration,
or at least we're not in the crosshairs of the
Trump administration.
Speaker 3 (27:39):
Right And with these transactional firms that have to deal
with the regulatory agencies, it could be a problem if
they're in the bad graces of the Trump administration.
Speaker 1 (27:50):
Yeah, exactly. I mean, a protracted dispute with the Trump
administration can make them seem like kind of a para
politically speaking. That makes clients look at them and say, well,
all we're worried about not getting good treatment from the
regulatory agencies that have to approve are massive that the
company deals. Those very expensive, very lucrative deals require the
(28:12):
goodwill of the executive branch agencies, and that is something
that is at risk when you're in a protracted dispute
with the Trump administration.
Speaker 3 (28:19):
You spoke to Bruce McEwan, who was a former in
house lawyer at Morgan Stanley, and he said, law firms,
for all their seeming solidity, are very fragile economically.
Speaker 1 (28:29):
So law firms really aren't organized like any other type
of business except for other professional services businesses like accounting.
What makes law firms different is that their shareholders are
internal to the company, and those shareholders who are the partners,
have the ability to go to any firm they want
at the drop of a hat. There are no non
(28:50):
compete agreements in the legal field like there are in
other professions, so the law firm can't impose any restrictions
on one of their lawyers moving to another firm, a
competitor firm that's willing to pay them more. And so
that's a huge reason why law firms are much more
a precarious type of business than other types of businesses.
Speaker 3 (29:11):
And the firms that are fighting back, what are they
best known for.
Speaker 1 (29:15):
Yeah, so these are firms that are very famous for
their work in the areas of litigation, and litigation is
just a practice area that you know, it's still very
sensitive to politics, but already kind of has an adversarial
stand by definition, just a breed of lawyers who are
much more willing to take an adversarial stance, whether it's
(29:36):
with the government or whether it's with another private sector party.
And according to the lawyers I've talked to you, that
kind of has bread a willingness in these firms too,
in their case take an adversarial stance against the Trump administration.
Now that doesn't mean it doesn't come with any risk.
There are risks involved, however, when you're litigating in a
courthouse as opposed to seeking merger clearance in an executive
(29:59):
branch agent. See, the courthouses are not subject to the
Trump administration's executive orders like the executive branch agencies are.
Speaker 3 (30:07):
I didn't realize this. The litigation firms have less revenue
than the transactional firms.
Speaker 1 (30:14):
Yes, they're on average about half as much in revenue
every year on average than the more transactional focused firms.
And that really just goes to show you how much
private equity and m and A has turbo charged the
profits of the wealthiest firms right now. But I think
what we're seeing right now is that it also shows
you how precarious that wealth is.
Speaker 3 (30:34):
That's why a lot of firms are caving before they're
even targeted in an executive order.
Speaker 1 (30:41):
There are several law firms that have come to the
table with the Trump administration in order to negotiate their
way out of an executive order. When you just look
at the rationale, the pretext backing these executive orders, it's
hard to imagine if a high profile law firm that
Trump might not have a beef with. You know, everybody
has some connection to a potential enemy of the president,
(31:04):
and so that makes the potential targets of these executive
orders pretty far and wide, and that I think is
making a lot of law firms come to the table
and try to negotiate preemptively their way out of an
executive order.
Speaker 3 (31:18):
Tell us about the sequence of firms settling with Trump.
Speaker 1 (31:22):
It started with Paul Weiss, which was targeted in an
executive order, and then they were able to get that
executive order rescinded in exchange for the kind of deal
that we would see three other firms adopt before issuing
the executive order against them. The firms that proactively made
deals with the Trump administration include Millbank, Wilkie, and Scattin.
(31:44):
And these deals have all taken on very similar details.
What difference is that Paul Weiss committed forty million dollars
in pro bona services and the other three firms committed
one hundred million dollars each.
Speaker 3 (31:56):
And then on Friday afternoon, five law firms reached agreements
with the Trump administration worth hundreds of millions of dollars
and free legal services.
Speaker 1 (32:08):
Five of the biggest law firms in the world, Five
of the biggest and wealthiest law fins in the world
reached deals with the Trump White House to avoid punitive
action against them in exchange for hundreds of millions of
dollars in pro bono legal services. The deal that was
announced on Friday says that Kirkland and Ellis, Latham and Walkin, Simpson,
(32:30):
Thatcher and Bartlett, Cadwalder and A and O. Sherman are
committing at least six hundred million dollars in pro bono
legal services to causes advocated by Trump. That's a combined
total of six hundred million. There's slightly different numbers for
each firm. Kirkland and Ellis, Lathman and Walkin Simpson Thatcher
and Anno Sherman each are committing one hundred and twenty
(32:52):
five million, while Cadwaller is committing one hundred million, So
the same as the deals reached by Scadden will Key
and Millbank. Other parts of the deal are similar to
what we've seen before. The firms are affirming their commitment
to quote unquote merit based hiring, and the deal says
that they will stay away from DEI based hiring. This
(33:14):
is a joint deal by these firms pledging pro bono
services for the president.
Speaker 3 (33:20):
So with this latest deal, that means the Trump administration
is close to a billion dollars in free legal services.
Speaker 1 (33:28):
Nine hundred and forty million dollars in pro bono services
is my tally. So that aligns with what we heard
from Stephen Miller at a Oval office event earlier this
week where he said, you know, at the end of
this we're getting close to a billion dollars in pro
bono legal services, and.
Speaker 3 (33:44):
Under these deals, what are the pro bono causes that
the firms are going to litigate?
Speaker 1 (33:49):
So, just to make it totally clear, what the firms
have said that have pledged pro bono legal services is
that they aren't letting the Trump administration call the sho
down to the individual client relationships. They've just set out
categories that they need to provide pro bono legal services
in order to comply with the agreement. And those categories
(34:12):
include advocating on behalf of veterans' rights. You know, that's
a very established conservative legal cause. There's combating anti semitism,
and then there's quote unquote fairness in the justice system.
There's still a lot of unanswered questions about how they
will comply with that. You know, I struggle to imagine
that the law firms and the Trump administration have the
(34:34):
same definition of those things, especially with something as broad
as fairness in the justice system. But these are clearly
areas that you know, Trump for a while now has
felt like big law isn't as fair to conservatives as
it is to liberal causes, and so this is his
way of in his mind, evening the playing field.
Speaker 3 (34:52):
And this week in the Oval Office, didn't he talk
about new areas for pro bono work.
Speaker 1 (34:58):
Yes, the President in the caterd that he's going to
commit the law firms to work on behalf of coal
mining efforts. I think he mentioned leasing, but that is,
you know, at this point, a vague category that there
is still some details to be worked out. But I
think the takeaway is that the President is starting to
view these deals as like a pro bone of piggybank
(35:20):
to commit the causes he supports.
Speaker 3 (35:23):
Is this then the end of the executive orders targeting
law firms.
Speaker 1 (35:28):
I am honestly unsure if there's more firms that are
going to be targeted. However, this does feel like a
culmination event. This does seem to be what Trump had
in mind when he said we are working with five
more firms to come to a deal.
Speaker 3 (35:43):
Let's turn for a moment to the firms that are litigating.
So three firms have already sued the Trump administration and
they've gotten some temporary orders from judges.
Speaker 1 (35:55):
Yes, so all three firms are looking for the executive
orders against them to be totally halted. But what they've
been able to get so far are temporary restraining orders
against parts of the executive orders. I believe the parts
that they were able to get temporary restraining orders for
are the parts of the orders that ask agency heads
to investigate any federal contractors that have relationships with these
(36:18):
firms for possible termination. That is an issue being raised around,
you know, keeping client relationships a secret, which is a
common practice in the world of lawyers. The other part
that was halted was the one that pertains to access
to federal buildings. The judges said that you can't bar
the personalities firms from entering federal agency buildings.
Speaker 3 (36:40):
And how has the Trump administration been defending these executive
orders which seem like retribution.
Speaker 1 (36:47):
It does, but what people are calling retribution has been
touched by the Trump administration in the language of protecting
national security interests, the language that was used in the
Perk Cooey executive order. The other legal pretext that's being
cited is anti discrimination law. Was going after firms for
(37:08):
alleged dei quote unquote discrimination.
Speaker 3 (37:11):
Familiar themes of this administration. Thanks so much, Justin. That's
Bloomberg Law reporter Justin Henry, And that's it for this edition.
Of the Bloomberg Law Show. Remember you can always get
the latest legal news on our Bloomberg Law Podcast. You
can find them on Apple Podcasts, Spotify, and at www
dot bloomberg dot com, slash podcast Slash Law, And remember
(37:33):
to tune into The Bloomberg Law Show every weeknight at
ten pm Wall Street Time. I'm June Grosso and you're
listening to Bloomberg
This is Bloomberg Law with June Grossel from Bloomberg Radio.
Speaker 2 (00:08):
Our March twelfth, my husband, Kilmer was abducted and disappeared
by the Trump administration.
Speaker 3 (00:15):
Kilmer Abrego Garcia was living in Maryland with his wife
and three children when immigration authorities arrested him and flew
him to prison in El Salvador. Under a twenty nineteen
court order, Garcia cannot be deported to his native country
of El Salvador because he's likely faced gang violence there.
This ould call administration error has destroyed my family's happiness.
(00:41):
The Trump administration admits that it made a mistake, but
argues it can no longer do anything about it. On Thursday,
a unanimous Supreme Court ordered the administration to take steps
to bring Garcia back. My guest is Leon Fresco, a
partner at Holland and Knight and the former head of
the Office of Immigration Litigation in the Obama administration. Leon,
(01:03):
the order here was just three paragraphs long. Tell us
about it.
Speaker 4 (01:07):
At the end of the day. What the Supreme Court
is saying is there was an agreed administrative error here.
So since there was an error, and this person clearly
has been now stipulated on all sides as an individual
that should not have been removed to El Savador because
he had this order called withholding of removal that prevented
(01:28):
his removal too, specifically El Salvador, that this person has
to be brought back, that that injunction that was issued
by the District Court is correct. But the question is
what does it mean that the government has to quote
unquote facilitate the return as opposed to effectuate the return.
And that's really going to be I think a dockdown,
(01:52):
drag out issue that's just going to come right back
to the Supreme Court.
Speaker 3 (01:55):
So technically the Supreme Court didn't order his return.
Speaker 4 (02:01):
This is what is very complicated about this decision is
that the Supreme Court basically gave a thankless task to
the District Court judge because it said that, yes, the
government needs to act to do what it can to
bring back mister Abrago Garcia to the United States, but
(02:23):
it's said within the proper constitutional limits of the court.
Here is the exact line. It says, the District Court
should clarify its directive with due regard for the difference
oh to the executive branch in the conduct of foreign affairs,
and then it says, for its part, the government should
be prepared to share what it can concerning the steps
(02:46):
it has taken and the prospect of further steps. So
it's trying to align itself with the concurrence of Judge Wilkinson's,
the conservative judge in the Fourth Circuit saying there is
an ability for the government to facilitate the return of
mister Abrago Garcia, but what it can't do is issue
(03:09):
these sort of global injunctions ordering al Salvador to do anything,
or ordering the United States government to order al Salvador
to do things. So this is going to be very
complicated because unlike a normal deportation case where the government
has been able to bring people back when there's a
(03:31):
dispute about their custody, here the Trump administration is saying,
this person is in Alsavador, end of story. We cannot
order President bucel to do anything. And so this is
going to be protracted litigation. In mind you that's going
to go right back up to the Supreme Court, because
you're going to have the district judge say bring them back,
(03:52):
and you're going to have the Fourth Circuit say what
is said again? And you're going to have the Supreme
Court has to deal with Look, is this prison really
in the control of the US government or is it
something where it's really in the control of Alsavador and
the US government can't do anything about it.
Speaker 3 (04:09):
Despite the complexities, this is a unanimous decision by the
Supreme Court in an immigration case.
Speaker 4 (04:17):
It is a Nino decision, and any nine oh decision
in immigration is very, very very surprising. You even have
Justice Alito, who almost never rules against the Department of
Justice on immigration, now sign out with a concurrence where
you have the three justices sort of my yor Kagan
and Jackson saying you have to bring this person back.
(04:38):
End of story. You've brought people back in the past,
bring this person back. And they're sort of anticipating what's
going to happen, which is that this case is coming
right back to the Supreme Court. I've actually seen already
tweet from the Trump administration saying, what do you want
us to do? This person is in Alsavador, they belong
(04:59):
to alpha it or end of story, we can't do anything.
We've won this case.
Speaker 3 (05:04):
You may be right, because it's already very contentious in
a hearing on Friday, the Trump administration lawyer refused to
tell the judge what the government is doing to bring
Garcia back or even where he is. Judge Paulsenese asked, quote,
this is a direct question, where is he an under
(05:24):
whose authority? And the answer from Justice Department lawyer Drew
Enson was, we are still internally reviewing the Supreme Court's
decision and vetting what we can say to this court.
So no answer is there.
Speaker 4 (05:37):
I mean, I'm sure the district court is going to
say this person is in the effective control of the
US government, because there's no way that El Salvador would
refuse to return this person back to the US if
the US insisted. But the question is, by the time
this case gets back up to the Supreme Court, is
(05:57):
the Supreme Court actually going to take the step of
saying that this person is really effectively, for all intensive purposes,
in US custody or are they going to allow this
sort of separation to exist in the legal sphere and say, well,
they're in Alsavador, they're in a Savadoran citizen, and they're
(06:20):
under the detention of the al Savadoran government. What really
can you force the US to do in this situation.
You want them to go to war or something to
bring this person back. That's not something a court can do.
And so this case is long but over.
Speaker 3 (06:37):
I mean, in the past, the government has brought people
back who've been wrongly deported to foreign countries.
Speaker 4 (06:45):
Yes, this happens dozens of times per year. There's many
times not even reported judicial decisions, because what will happen
is the appellate courts won't issue us stay in a case,
and then by the time the government actually starts briefing
the case, they realize the person had been removed and
they say, oh, boy, probably we shouldn't have done this,
and the person comes back. So that happened all the time.
(07:08):
The difference here is twofold. One. You have an administration
that for the first time is contesting this that they
even have the legal ability to bring someone back. So
you've never had that before. You've always had administrations that
are amenable to bringing people back. This is the first
one that isn't. But then secondly, this is the first
(07:28):
time that you have a foreign national literally in the
custody of the country to which they were removed. And
so that's a whole new set of facts. If that
government had some interest in actually having that person in custody,
that would be quite the issue. Now, what makes this
(07:48):
even a higher level of complexity is this was literally
the exact time that the person got released for, which
is that they said, if I get supported to Al Salvador,
I will be persecuted by the government and said to
some terrible confinement facility where I will be tortured and
possibly killed. And so this person is literally living the
(08:10):
manifestation of the thing that they were given relief for
not to happen. So I cannot say how complicated this
is now.
Speaker 3 (08:20):
This decision came two days after another immigration decision, where
the court ruled that the administration can keep using the
Alien Enemies Act, a wartime law, to deport alleged Venezuelan
gang members, but that the administration has to give the
detainees notice and a chance to be heard.
Speaker 4 (08:40):
So the Supreme Court said that the government can use
the Alien Enemies Act at the moment to try to
begin a process of defortation, but that people have a
right to challenge in habeas a whether you can actually
own the merits use the Alien Enemies Act. So yes,
(09:01):
they can begin this process, but can the Alien enemies
actually be used. But what I mean by that is
usually the Alien Enemies Act is invoked in the time
of war World War one, World War two, et cetera.
This is the first time it's being invoked for the
principle that there is a group of people who've committed
some sort of informal incursion in the United States for
(09:23):
the purposes of destabilizing the country, which is this Venezuelan
gang trend that raduas. So that's one analysis. Can it
be used for an informal gang as opposed to during
an actual declared war? They want the lower courts to
hear those arguments and flesh out from logic here before
it gets to the Supreme Court. That's number one. But
(09:45):
then number two is, even if it can, does the
person have the right to say, yeah, but I'm not
a member of this gang. I'm from Cleveland, for instance,
Why are you deporting me to El Savador or Venezuela
or anywhere else? Even I'm a Venezuelan hairdresser that's never
set foot in a gang, you know. And so now
(10:06):
there is an established Supreme Court decision that says, yes,
in habeas you get to make this argument, and also.
Speaker 3 (10:12):
The detainees have to file the havieas and the jurisdiction
they're being held in, which is happening already.
Speaker 4 (10:18):
So the ACLU went and filed habeases in New York
and in the southern districts of Texas, and immediately there
were two stays of deportation issued, both blocking the removal
and both under the ground that the plaintifs were likely
to succeed in their habeases, saying that the alien enemies
that could not be used to accomplish the type of
(10:42):
deportation that the government wanted the normal immigration court removal process.
This is going to be a very interesting process that
I think will also get to the Supreme Court about.
There's sort of two layers of briefing. There's one are
you subject to the alien enemy's acts as it were?
Meaning are you actually one of these trend to a
(11:04):
Agua gang members? But there's a second, which is should
this thing even apply? And should you actually just go
to immigration court and be able to make any defense
that you want and not be subject to this special
type of hearing. So there's both kinds of analyzes, and
the courts may need to do both, and we'll see
(11:25):
what ultimately works its way up to the Supreme Court.
As a result of.
Speaker 3 (11:28):
This, this administration is certainly keeping the Supreme Court busy.
Thanks so much, Leon. That's Leon Fresco of Holland and
Knight coming up next on the Bloomberg Law Show. Are
Trumps Supreme Court victories more about procedure than substance? I'm
June Gross. When you're listening to Bloomberg. President Trump is
(11:49):
turning to the Supreme Court over and over again as
lower court judges rein in his efforts to push the
limits of executive power, and the court's conservative majority seems
to be accommodating him with narrow winds that allow his
administration to move forward with his agenda deporting alleged Venezuelan
gang members, halting teacher grants, and firing federal workers. Is
(12:13):
it any wonder that liberal Justice Sonya Soto Mayor, who
dissented and all these administration wins, recently expressed concerns about
the rule of law.
Speaker 2 (12:23):
One of the things that's trumbling so many right now
is many of the standards that are being changed right
now were norms that government that governed officials into what
was right and wrong. Once norms are broken, then you're
shaking some of the foundation of the rule of law.
Speaker 3 (12:45):
Trump has been touting these victories, but a close look
shows their wins based on procedure rather than on the
merits more form over substance. My guest is constitutional law
expert David super, a professor at Georgetown Law. David, if
my calculations are correct, the Trump administration has made ten
(13:05):
emergency applications to the Supreme Court in less than three months.
I'm sure that's a record. But why is the Supreme
Court addressing so many of these issues?
Speaker 5 (13:17):
Well, the Trump administration is making sweeping changes in our
system of government, changing things that have been understood at
least since the New Deal, in many of them since
the founding. So these are important enough issues to merit
the Supreme Court's attention when they are enjoyed for being unlawful.
Speaker 3 (13:40):
So last Friday, the Supreme Court allowed the Education Department
to withhold money for teacher training projects in eight states.
It was a five to four decision to Justice John
Roberts sided with the Court's three liberals who would have
turned Trump down. Do you see why is with the
Court's liberals in that particular.
Speaker 5 (13:59):
Case, because he didn't write an opinion and he didn't
sign the opinions written by the liberal justices. So my
sense is that he simply didn't feel that the administration
had made a sufficiently compelling case, and he wasn't entirely
persuaded by what the conservative majority wrote in their opinion.
Speaker 3 (14:19):
So did the conservative majority basically go off on a
procedural point.
Speaker 5 (14:24):
Yeah, many of these cases are procedural. The majority is
looking with a very powerful magnifying glass at the procedure
and in particular about which court something is filed in,
and are in three of the most significant cases finding
(14:45):
that they don't believe it was in the right court.
That says nothing about the merits if the cases get
refiled in the court that the Supreme Court prefers. So
I don't think we can read very much into it
other than that this court is hoping, against hope that
if they give the administration a little more time, that
it will come into compliance.
Speaker 6 (15:06):
With the law.
Speaker 3 (15:07):
Justice Katanji Brown Jackson, in a disense, said it was
beyond puzzling that a majority of justices conceive of the
government's application as an emergency. I mean, it doesn't appear
that there's a real emergency in most of these applications
to the court.
Speaker 5 (15:23):
Now it doesn't. There's no indication that funding these teacher
training programs would do any devastating harm. But everything the
administration does these days, it claims is an emergency. And
their basic theme is that they get to define what
an emergency is, no matter how absurd that claim is.
(15:48):
And for the moment, the Supreme Court is humoring them
on this. My sense is that that game will only
work for so long.
Speaker 3 (15:56):
In probably the most high profile of these emergency petition
on Monday, the Court allowed Trump to continue deporting Venezuelan
migrants to prison in El Salvador under the Alien Enemies Act,
granting an emergency request on a five to four vote
without deciding if he was using that law lawfully.
Speaker 5 (16:18):
Yes, they said that that case should not have been
in the district of the District of Lumbia, should have
been in the southern District of Texas, and the reasons
for that are not silly, but not very compelling either.
There certainly were plausible reasons to have filed the case
where they did, but I think they're hoping that if
(16:41):
they make the case start all over again in the
Southern District of Texas as the administration will chalk that
up as a whin and back off from its absurd policy.
Speaker 3 (16:50):
They also didn't address the fact that hundreds of Venezuelan
migrants have been shipped to l Salvador already and are
in prison there a harsh prison, and Bloomberg News found
that just seven out of the two hundred and thirty
eight migrants have been found guilty of serious crimes. I mean,
(17:12):
they're sending people there based on tattoos and the kind
of clothes they're wearing, and the court just let that
go by.
Speaker 5 (17:20):
Well, the court said that there wasn't jurisdiction in the
district of Columbia, so they haven't said this is okay.
They have instead insisted that all that he's be crossed
and all the eyes be dotted before a court takes
action on this. Jurisdiction is one of the fundamental attributes
(17:40):
of courts, and they do need to attend to their jurisdiction.
On the other hand, past courts have been willing to
resolve close questions on jurisdiction in favor of getting justice done.
And here five members of the Court were not willing
to do that.
Speaker 3 (17:57):
Again, it was five to four, but this time Justice
aims Cony Barrett joined the liberal justices any accounting for
sort of the Chief and Justice Barrett switching positions in
these two cases.
Speaker 5 (18:09):
I think that both cases, the majority's argument was tenuous,
and it wasn't enough to persuade the Chief in the
first instance, and it wasn't enough to persuade Justice Barrett
in the second instance. Both are signaling that they are
not rubber stamps for the administration. But both of them,
(18:30):
I think are also signaling that they would like to
give the administration a chance to come into compliance on
its own. How long their patients will last remains to
be seen.
Speaker 3 (18:43):
Then, on Tuesday, in the first mass firing case to
reach the court, the justices bolstered Trump's campaign to fire
federal workers, blocking a judge's order that required the administration
to reinstate employees. So this was seven to two, with
Justices Sotomayor and Katanji Brown Jackson dissenting again based on procedure.
Speaker 5 (19:05):
Yes, the argument was that these cases should have been
brought initially through the merit system's civil service process and
resolved there rather than in federal court if there have
been one individual person fired based on a quibble over
whether they were taking too much sickly, absolutely, the merit
(19:27):
system's process would be the right place. When it's being
done as a matter of policy on a mass basis
without any consideration of individual circumstances, an injunction seems more appropriate.
But here the court decided to again insist on jurisdictional perfection.
Speaker 3 (19:46):
Is the majority sort of checking the easy way out
in these cases by making it more about procedure than
about the merits or the administration's policies.
Speaker 5 (19:56):
Oh, yes, very much. So you're not seeing opinion endorsing
what the administration has done. That would be very easy
for them to write either as an opinion of the
court or as a concurring opinion from Justice Alito or whomever.
And you're just not seeing that. You're seeing nitpicking on jurisdiction.
So no one is sending the administration signs that what
(20:19):
it's doing is okay. And I think if the administration's
lawyers are paying the least bit of attention, they will
recognize that they're being given time but absolutely no encouragement
on the merits. If the administration's lawyer, is there any
good they're telling them behind the scenes that you're dodging
a bullet here and dodging a bullet there, but that
(20:41):
the silence of even the most conservative justices on the
merits of your action is quite definite. And once the
plainness follow the instructions of the court as to how
to obtain jurisdiction, the court is giving the administration no
encouragement that it will get support on the merits.
Speaker 3 (20:59):
On Thursday, Trump went to the Supreme Court after the
full DC Circuit Court of Appeals reinstated to independent agency
officials who had been fired by Trump without cause, and
the Chief Justice put that DC Circuit Court decision on hold,
so the fired workers remain fired. Does Roberts action indicate
(21:22):
support for Trump's efforts to remove any limits on his
power to hire and fire.
Speaker 5 (21:29):
That's not clear. The Chief Justice has previously daid actions
of lower courts and then turned around and voted against
the administration on the merits, So at the moment, all
we could assume is that this stay is an indication
that he thinks that all the justices ought to be
able to weigh in, which is sensible enough on an
(21:50):
issue of this scale. On the other hand, the question
of independent agencies may be a more complicated one in
the court because several justices have indicated that they don't
like independent agencies or don't believe that their independence is appropriate.
So on this one, it's certainly is possible that one
all is said in times, the administration will succeed in
(22:12):
changing constitutional law. I don't like the administration's chances on
most of the others.
Speaker 3 (22:17):
Now, on Thursday night, the Supreme Court handed the Trump
administration a high profile defeat when a unanimous court ordered
the administration to return to the United States a man
who had been deported to l Salvador because of an
administration error. Where does that decision fit in this puzzle.
Speaker 6 (22:37):
Well, I think it suggests that the Supreme Court has
its limits, and it's telling the administration that we've now
got two unanimous decisions in the scope of a week
regarding sending people overseas. The first one found the procedural
fault with the case that had been brought, but said
(22:57):
that everybody has to be given notice and a chance
to ask for a hearing before they can be sent overseas.
And then for this gentleman who was sent overseas without
any process at all and contrary to law. They've now
unanimously told the administration to get him back. That suggests
(23:17):
that the Court is trying to give them space, trying
to give them leeway, but when it sees serious abuses,
it will step in.
Speaker 3 (23:27):
And why was it important that this was unanimous.
Speaker 6 (23:32):
It's important because this administration has already shown that it's
not very concerned about violating court orders. It's violated many
lower court orders. And I suspect that the justices were
concerned that if there was a split decision from the
Supreme Court, the administration would seize on that to refuse
(23:53):
to comply. As well, during the desegregation era, the Supreme
Court worked very hard to achieve unanimity, even if the
decisions that they wrote weren't as sweeping as they would
have liked, just because there was concern that many people
were disregarding the opinion. Similarly, in the Nixon Tape's case,
was unanimous with the Chief Justice writing the opinion, even
(24:17):
though many of the justices would have preferred a stronger opinion.
Unanimity was more important.
Speaker 3 (24:23):
This has been a fascinating discussion Thanks so much, David.
That's Professor David Super of Georgetown Law coming up Trump's
war on big laws, bringing in close to a billion
dollars in free legal services. I'm June Grosso and you're
listening to Bloomberg. President Donald Trump's unprecedented attack on big
(24:43):
law is yielding him hundreds of millions of dollars in
free legal services as many of the top Wall Street
firm's cave and settle with the administration, some even before
they've been targeted in an executive order we signed with
many law firms, the ones that we thought were inappropriate,
(25:03):
inappropriate seeming to mean their lawyers acted against Trump, his policies,
or his allies in some way. These executive orders generally
require that security clearances of a firm's lawyers be suspended,
that federal contracts be terminated, and that employee access to
federal buildings be restricted. While some firms have chosen to settle,
(25:27):
others have chosen to fight Trump in court, where judges
have already found his executive orders likely unconstitutional. So why
does one firm settle while another litigates? Here to tell
us his Bloomberg Law reporter Justin Henry justin how would
you describe the firms that are settling.
Speaker 1 (25:47):
So, the firms that we're seeing settle are primarily concentrated
in New York. I think all of them are headquartered
or at least originating from New York and have real
Wall Street pedigree. They're also much more wealthy, and a
lot of that wealth has come from their rainmaker transactional practices,
so corporate deals involving mergers and acquisitions and private equity.
Speaker 3 (26:10):
And explain why the firms that do transactional work want
to settle with Trump.
Speaker 1 (26:15):
So my understanding is that they have really sensitive client relationships,
clients who are very averse being in kind of the
political limelight. Some of those firms have client relationships that
are worth one hundred million dollars a year in revenue
or more. And those are client relationships that could vanish
literally overnight if their lawyers can't represent them in front
(26:39):
of government agencies or get the same kind of attention
from regulatory agencies to put the deals through. And then
that in a matter of days could decrease the overall
profitability of the firm, which would have a cascading effect
on other partners at the firm. Making lesson profits and
then also being vulnerable approaching by other firms. So you
(27:00):
could have a phenomenon that resembles the kind of run
on the bank.
Speaker 3 (27:03):
So they're even afraid that their partners will abandon them exactly.
Speaker 1 (27:08):
Yeah, and not for any individual lawyer's sort of decision
making on the process. It's really a coordination issue where
you know, they might want to stay with the firm,
the clients might want to stay with the firm, but
just because of business reasons, not because of political reasons.
There's no shortage of other firms looking to scoop up
that business, and they can come to them and say, hey, listen,
(27:30):
we're not in the negative limelight of the president. Come
to us. We still have a good relationship with the administration,
or at least we're not in the crosshairs of the
Trump administration.
Speaker 3 (27:39):
Right And with these transactional firms that have to deal
with the regulatory agencies, it could be a problem if
they're in the bad graces of the Trump administration.
Speaker 1 (27:50):
Yeah, exactly. I mean, a protracted dispute with the Trump
administration can make them seem like kind of a para
politically speaking. That makes clients look at them and say, well,
all we're worried about not getting good treatment from the
regulatory agencies that have to approve are massive that the
company deals. Those very expensive, very lucrative deals require the
(28:12):
goodwill of the executive branch agencies, and that is something
that is at risk when you're in a protracted dispute
with the Trump administration.
Speaker 3 (28:19):
You spoke to Bruce McEwan, who was a former in
house lawyer at Morgan Stanley, and he said, law firms,
for all their seeming solidity, are very fragile economically.
Speaker 1 (28:29):
So law firms really aren't organized like any other type
of business except for other professional services businesses like accounting.
What makes law firms different is that their shareholders are
internal to the company, and those shareholders who are the partners,
have the ability to go to any firm they want
at the drop of a hat. There are no non
(28:50):
compete agreements in the legal field like there are in
other professions, so the law firm can't impose any restrictions
on one of their lawyers moving to another firm, a
competitor firm that's willing to pay them more. And so
that's a huge reason why law firms are much more
a precarious type of business than other types of businesses.
Speaker 3 (29:11):
And the firms that are fighting back, what are they
best known for.
Speaker 1 (29:15):
Yeah, so these are firms that are very famous for
their work in the areas of litigation, and litigation is
just a practice area that you know, it's still very
sensitive to politics, but already kind of has an adversarial
stand by definition, just a breed of lawyers who are
much more willing to take an adversarial stance, whether it's
(29:36):
with the government or whether it's with another private sector party.
And according to the lawyers I've talked to you, that
kind of has bread a willingness in these firms too,
in their case take an adversarial stance against the Trump administration.
Now that doesn't mean it doesn't come with any risk.
There are risks involved, however, when you're litigating in a
courthouse as opposed to seeking merger clearance in an executive
(29:59):
branch agent. See, the courthouses are not subject to the
Trump administration's executive orders like the executive branch agencies are.
Speaker 3 (30:07):
I didn't realize this. The litigation firms have less revenue
than the transactional firms.
Speaker 1 (30:14):
Yes, they're on average about half as much in revenue
every year on average than the more transactional focused firms.
And that really just goes to show you how much
private equity and m and A has turbo charged the
profits of the wealthiest firms right now. But I think
what we're seeing right now is that it also shows
you how precarious that wealth is.
Speaker 3 (30:34):
That's why a lot of firms are caving before they're
even targeted in an executive order.
Speaker 1 (30:41):
There are several law firms that have come to the
table with the Trump administration in order to negotiate their
way out of an executive order. When you just look
at the rationale, the pretext backing these executive orders, it's
hard to imagine if a high profile law firm that
Trump might not have a beef with. You know, everybody
has some connection to a potential enemy of the president,
(31:04):
and so that makes the potential targets of these executive
orders pretty far and wide, and that I think is
making a lot of law firms come to the table
and try to negotiate preemptively their way out of an
executive order.
Speaker 3 (31:18):
Tell us about the sequence of firms settling with Trump.
Speaker 1 (31:22):
It started with Paul Weiss, which was targeted in an
executive order, and then they were able to get that
executive order rescinded in exchange for the kind of deal
that we would see three other firms adopt before issuing
the executive order against them. The firms that proactively made
deals with the Trump administration include Millbank, Wilkie, and Scattin.
(31:44):
And these deals have all taken on very similar details.
What difference is that Paul Weiss committed forty million dollars
in pro bona services and the other three firms committed
one hundred million dollars each.
Speaker 3 (31:56):
And then on Friday afternoon, five law firms reached agreements
with the Trump administration worth hundreds of millions of dollars
and free legal services.
Speaker 1 (32:08):
Five of the biggest law firms in the world, Five
of the biggest and wealthiest law fins in the world
reached deals with the Trump White House to avoid punitive
action against them in exchange for hundreds of millions of
dollars in pro bono legal services. The deal that was
announced on Friday says that Kirkland and Ellis, Latham and Walkin, Simpson,
(32:30):
Thatcher and Bartlett, Cadwalder and A and O. Sherman are
committing at least six hundred million dollars in pro bono
legal services to causes advocated by Trump. That's a combined
total of six hundred million. There's slightly different numbers for
each firm. Kirkland and Ellis, Lathman and Walkin Simpson Thatcher
and Anno Sherman each are committing one hundred and twenty
(32:52):
five million, while Cadwaller is committing one hundred million, So
the same as the deals reached by Scadden will Key
and Millbank. Other parts of the deal are similar to
what we've seen before. The firms are affirming their commitment
to quote unquote merit based hiring, and the deal says
that they will stay away from DEI based hiring. This
(33:14):
is a joint deal by these firms pledging pro bono
services for the president.
Speaker 3 (33:20):
So with this latest deal, that means the Trump administration
is close to a billion dollars in free legal services.
Speaker 1 (33:28):
Nine hundred and forty million dollars in pro bono services
is my tally. So that aligns with what we heard
from Stephen Miller at a Oval office event earlier this
week where he said, you know, at the end of
this we're getting close to a billion dollars in pro
bono legal services, and.
Speaker 3 (33:44):
Under these deals, what are the pro bono causes that
the firms are going to litigate?
Speaker 1 (33:49):
So, just to make it totally clear, what the firms
have said that have pledged pro bono legal services is
that they aren't letting the Trump administration call the sho
down to the individual client relationships. They've just set out
categories that they need to provide pro bono legal services
in order to comply with the agreement. And those categories
(34:12):
include advocating on behalf of veterans' rights. You know, that's
a very established conservative legal cause. There's combating anti semitism,
and then there's quote unquote fairness in the justice system.
There's still a lot of unanswered questions about how they
will comply with that. You know, I struggle to imagine
that the law firms and the Trump administration have the
(34:34):
same definition of those things, especially with something as broad
as fairness in the justice system. But these are clearly
areas that you know, Trump for a while now has
felt like big law isn't as fair to conservatives as
it is to liberal causes, and so this is his
way of in his mind, evening the playing field.
Speaker 3 (34:52):
And this week in the Oval Office, didn't he talk
about new areas for pro bono work.
Speaker 1 (34:58):
Yes, the President in the caterd that he's going to
commit the law firms to work on behalf of coal
mining efforts. I think he mentioned leasing, but that is,
you know, at this point, a vague category that there
is still some details to be worked out. But I
think the takeaway is that the President is starting to
view these deals as like a pro bone of piggybank
(35:20):
to commit the causes he supports.
Speaker 3 (35:23):
Is this then the end of the executive orders targeting
law firms.
Speaker 1 (35:28):
I am honestly unsure if there's more firms that are
going to be targeted. However, this does feel like a
culmination event. This does seem to be what Trump had
in mind when he said we are working with five
more firms to come to a deal.
Speaker 3 (35:43):
Let's turn for a moment to the firms that are litigating.
So three firms have already sued the Trump administration and
they've gotten some temporary orders from judges.
Speaker 1 (35:55):
Yes, so all three firms are looking for the executive
orders against them to be totally halted. But what they've
been able to get so far are temporary restraining orders
against parts of the executive orders. I believe the parts
that they were able to get temporary restraining orders for
are the parts of the orders that ask agency heads
to investigate any federal contractors that have relationships with these
(36:18):
firms for possible termination. That is an issue being raised around,
you know, keeping client relationships a secret, which is a
common practice in the world of lawyers. The other part
that was halted was the one that pertains to access
to federal buildings. The judges said that you can't bar
the personalities firms from entering federal agency buildings.
Speaker 3 (36:40):
And how has the Trump administration been defending these executive
orders which seem like retribution.
Speaker 1 (36:47):
It does, but what people are calling retribution has been
touched by the Trump administration in the language of protecting
national security interests, the language that was used in the
Perk Cooey executive order. The other legal pretext that's being
cited is anti discrimination law. Was going after firms for
(37:08):
alleged dei quote unquote discrimination.
Speaker 3 (37:11):
Familiar themes of this administration. Thanks so much, Justin. That's
Bloomberg Law reporter Justin Henry, And that's it for this edition.
Of the Bloomberg Law Show. Remember you can always get
the latest legal news on our Bloomberg Law Podcast. You
can find them on Apple Podcasts, Spotify, and at www
dot bloomberg dot com, slash podcast Slash Law, And remember
(37:33):
to tune into The Bloomberg Law Show every weeknight at
ten pm Wall Street Time. I'm June Grosso and you're
listening to Bloomberg
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