Donald Trump’s executive orders against three major U.S. law firms this month has taken the industry to a place that would have been unthinkable just a few months ago. Conservative strategist Steven Bannon alluded to the millions being earned by lawyers and said the aim was to bankrupt firms. So when Covington & Burling, Perkins Coie and Paul Weiss Rifkind Wharton & Garrison were targeted it felt to many like a direct assault on the very foundation of the rule of law. As one commentator wrote on LinkedIn: “A functioning democracy requires an independent legal profession, free from government intimidation. If lawyers can be punished for representing disfavored clients, our entire justice system, our rule of law, and our very Constitution are all at risk.” But this was only the beginning. Nineteen major law firms, plus Perkins Coie again—Trump really dislikes the firm—then became embroiled when the U.S. Equal Employment Opportunity Commission (EEOC) requested information on their diversity, equity, and inclusion (DEI) employment practices, on the basis they may themselves be a form of discrimination. The list read like a who’s who of Big Law: A&O Shearman; Cooley; Debevoise & Plimpton; Freshfields Bruckhaus Deringer; Goodwin Procter; Hogan Lovells; Kirkland & Ellis; Latham & Watkins; McDermott Will & Emery; Milbank; Morgan, Lewis & Bockius; Morrison & Foerster; Reed Smith; Ropes & Gray; Sidley Austin; Simpson Thacher & Bartlett; Skadden, Arps, Slate, Meagher & Flom; White & Case; Wilmer Cutler Pickering Hale and Dorr. Can you spot the odd one out? Freshfields is not nearly as big in the U.S. as the others. Why was it, or any of the firms, chosen? Was this diversity initiative the inspiration? It seems these actions are not just about these firms, but represent a larger confrontation. The opening sentence of the order against Paul Weiss reads: “Global law firms have for years played an outsized role in undermining the judicial process and in the destruction of bedrock American principles.” Paul Weiss has since settled with the administration but this feels like a bigger broadside against the industry. Many view the list as a calculated selection—random enough to represent the whole, but strategic enough to make other firms take notice and act. If so, it seems to have worked. Latham and Hogan Lovells have quietly removed DEI-related content from their websites. And, significantly, firms not named on the EEOC list have done the same—Bryan Cave Leighton Paisner is reviewing its diversity and inclusion initiatives. Morrison & Foerster, meanwhile, faces accusations of dropping a trans client due to Trump's clampdown on DEI. Any firm with a sizeable U.S. presence will no doubt be hastily reviewing its website language and checking its policies, if it hasn't already. Plus, any firm that will soon be big in the U.S., such as Herbert Smith Freehills, a pioneer law firm in the area of diversity but which is this week voting on its U.S. merger with Kramer Levin Naftalis & Frankel, will likely do the same. This will inevitably lead to disagreements within the firms themselves. There are insiders at some of these institutions who have said they are upset about the changes. Why should firms be running scared? Clients have also indicated they might seek to move business away from firms that either fail to speak out or retreat from their diversity commitments. The counterview is that firms are playing it safe. Taking a stand as a single institution might achieve little—no one wants to be the firm that spoke out only to become the next target. Working as a collective makes more sense. Bar associations from around the world issued a joint response condemning Trump’s targeting of the legal profession. It remains to be seen whether such statements will have a tangible effect, but perhaps that is beside the point. So how will this conflict ultimately unfold? Let’s consider three potential outcomes... | 