OM DENNE EPISODE
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The new year brings new opportunities for lawyers and law firms. And this month also marks the return of Donald Trump to the White House, which will have significant implications for the world of Biglaw.
Overall, there’s optimism in the halls of large law firms about 2025. As consultant Peter Zeughauser of the Zeughauser Group said, “Big picture, all indications are it will be a strong year for Biglaw. Corporate, private equity, M&A, regulatory, and complex litigation—all are already gaining momentum.”
Here are three practice areas worth watching during the new year and presidential administration.
Mergers and Acquisitions
“Corporate M&A could become more active, as a more hands-off, laissez-faire philosophy comes to the fore at the Justice Department’s antitrust division,” said consultant Bruce MacEwen, president of Adam Smith, Esq.
During the Biden administration, the Department of Justice antitrust division, led by Jonathan Kanter, and the Federal Trade Commission, led by Lina Khan, took an aggressive approach to merger enforcement. And despite some high-profile losses in court, their strategies had an impact on M&A activity.
As Cleary Gottlieb partner Paul Shim told me in a podcast interview, “You see in the media lots of snarky stories about how the FTC and the DOJ, they lost this lawsuit, they lost that lawsuit, and whatnot. But I have to say, as a practitioner, they’ve been successful in increasing the cost and time of doing big M&A deals, and it’s giving people pause.”
So it makes sense that Wall Street dealmakers are excited about a possible uptick in big-ticket mergers and acquisitions under Trump. The hope is that the Trump administration will work with companies on crafting settlements that allow transactions to go forward, with tweaks—as opposed to killing deals off altogether, as the Biden administration often sought to do.
Private Credit
“Money practices are widely expected to benefit” in the new year and new administration, according to consultant Kent Zimmermann of the Zeughauser Group. “That includes private credit and finance more broadly, particularly where those practices intersect with sectors that are on the receiving end of increasing demand and investment under Trump 2.0.”
As traditional banks became subject to more onerous lending rules in the wake of the Great Recession, private credit in particular boomed. It’s now a $1.7 trillion industry—and top law firms have built up their private-credit practices to meet the sector’s needs.
The outlook for private credit dimmed somewhat in 2024. The industry faced a “cocktail of risks,” such as interest-rate hikes, regulatory scrutiny, and a slow market for megadeals that drove the sector’s growth for several years.
Private credit has not yet been tested by a sustained economic downturn—and its recent challenges led some observers to wonder whether its day of reckoning was nigh. But if M&A work comes roaring back in 2025, so will private credit.
Antitrust
Merger enforcement isn’t all there is to antitrust enforcement. While the Trump administration will likely allow more mergers to go through, it will probably continue the Biden administration’s practice of investigating and litigating antitrust claims against large companies.
Three of the new administration’s key antitrust picks—Gail Slater as DOJ antitrust chief, Andrew Ferguson as FTC chair, and Mark Meador as FTC commissioner—are seen as aligned with the “New Right.” This more populist school of conservative thought takes a more critical view of corporate power, at least compared with the more business-friendly Republicans of years past.
Given Trump’s own past criticism of the technology sector, especially social-media companies, his administration is widely expected to continue vigorous antitrust enforcement against Big Tech. But we could see plenty of antitrust activity in other industries as well, such as the health-care sector.
So there should be plenty of work to go around for lawyers and law firms focused on antitrust. As Gerald Stein, an antitrust partner at Davis Wright Tremaine, put it, “It’s still going to be an aggressive antitrust enforcement regime. But it’s going to have a different feel to it.”
Risks of Uncertainty
Of course, Trump can be unpredictable. And unpredictability can bring risks for companies, individuals, and the law firms that serve them.
“There is considerable uncertainty on the horizon, and investors usually don’t like uncertainty,” Zimmermann said. “That could cut against anticipated demand increases for law firms in some transactional practices, necessitating investment by law firms in acyclical practices such as sophisticated litigation, investigations, and Washington-facing practices.”
“It remains to be seen what campaign promises become reality, in areas such as trade and immigration, and what the associated impacts might be,” he added. For example, high tariffs or restrictive immigration policies could contribute to inflation, which could have ripple effects across the economy that would affect demand scenarios for law firms.
But Trump following through on some policy issues highlighted during his campaign could also generate more work for lawyers and firms. For example, as noted by Bruce MacEwen of Adam Smith, Esq., we could see more litigation (including class actions) related to immigration, expulsion, and citizenship. And, he added, we should also expect high levels of activity “in all things related to ‘administrative procedure,’ a backwater for 50 years, as Trump ups all kinds of changes both in enforcement and laxity.” (Although the case was first filed during the Biden administration, the legal battle over the Federal Communications Commission’s net-neutrality rules—the subject of my latest Ruling of the Week, the Sixth Circuit’s decision in In re: MCP No. 185—is a good example of what we can expect on this front, as courts grapple with what agencies can and cannot do in a post-Chevron world.)
In the end, Kent Zimmermann of the Zeughauser Group remains optimistic about the near-term outlook for the legal sector.
“Broadly speaking, despite all the uncertainty, history suggests that change is generally good for law firms.”
A version of this article originally appeared on Bloomberg Law, part of Bloomberg Industry Group, Inc. (800-372-1033), and is reproduced here with permission.
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