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Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio.

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Speaker 2: Our March twelfth, my husband, Kilmer was abducted and disappeared

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Speaker 2: by the Trump administration.

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Speaker 3: Kilmer Abrego Garcia was living in Maryland with his wife

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Speaker 3: and three children when immigration authorities arrested him and flew

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Speaker 3: him to prison in El Salvador. Under a twenty nineteen

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Speaker 3: court order, Garcia cannot be deported to his native country

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Speaker 3: of El Salvador because he's likely faced gang violence there.

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Speaker 3: This ould call administration error has destroyed my family's happiness.

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Speaker 3: The Trump administration admits that it made a mistake, but

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Speaker 3: argues it can no longer do anything about it. On Thursday,

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Speaker 3: a unanimous Supreme Court ordered the administration to take steps

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Speaker 3: to bring Garcia back. My guest is Leon Fresco, a

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Speaker 3: partner at Holland and Knight and the former head of

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Speaker 3: the Office of Immigration Litigation in the Obama administration. Leon,

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Speaker 3: the order here was just three paragraphs long. Tell us

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Speaker 3: about it.

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Speaker 4: At the end of the day. What the Supreme Court

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Speaker 4: is saying is there was an agreed administrative error here.

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Speaker 4: So since there was an error, and this person clearly

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Speaker 4: has been now stipulated on all sides as an individual

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Speaker 4: that should not have been removed to El Savador because

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Speaker 4: he had this order called withholding of removal that prevented

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Speaker 4: his removal too, specifically El Salvador, that this person has

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Speaker 4: to be brought back, that that injunction that was issued

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Speaker 4: by the District Court is correct. But the question is

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Speaker 4: what does it mean that the government has to quote

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Speaker 4: unquote facilitate the return as opposed to effectuate the return.

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Speaker 4: And that's really going to be I think a dockdown,

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Speaker 4: drag out issue that's just going to come right back

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Speaker 4: to the Supreme Court.

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Speaker 3: So technically the Supreme Court didn't order his return.

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Speaker 4: This is what is very complicated about this decision is

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Speaker 4: that the Supreme Court basically gave a thankless task to

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Speaker 4: the District Court judge because it said that, yes, the

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Speaker 4: government needs to act to do what it can to

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Speaker 4: bring back mister Abrago Garcia to the United States, but

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Speaker 4: it's said within the proper constitutional limits of the court.

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Speaker 4: Here is the exact line. It says, the District Court

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Speaker 4: should clarify its directive with due regard for the difference

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Speaker 4: oh to the executive branch in the conduct of foreign affairs,

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Speaker 4: and then it says, for its part, the government should

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Speaker 4: be prepared to share what it can concerning the steps

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Speaker 4: it has taken and the prospect of further steps. So

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Speaker 4: it's trying to align itself with the concurrence of Judge Wilkinson's,

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Speaker 4: the conservative judge in the Fourth Circuit saying there is

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Speaker 4: an ability for the government to facilitate the return of

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Speaker 4: mister Abrago Garcia, but what it can't do is issue

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Speaker 4: these sort of global injunctions ordering al Salvador to do anything,

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Speaker 4: or ordering the United States government to order al Salvador

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Speaker 4: to do things. So this is going to be very

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Speaker 4: complicated because unlike a normal deportation case where the government

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Speaker 4: has been able to bring people back when there's a

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Speaker 4: dispute about their custody, here the Trump administration is saying,

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Speaker 4: this person is in Alsavador, end of story. We cannot

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Speaker 4: order President bucel to do anything. And so this is

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Speaker 4: going to be protracted litigation. In mind you that's going

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Speaker 4: to go right back up to the Supreme Court, because

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Speaker 4: you're going to have the district judge say bring them back,

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Speaker 4: and you're going to have the Fourth Circuit say what

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Speaker 4: is said again? And you're going to have the Supreme

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Speaker 4: Court has to deal with Look, is this prison really

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Speaker 4: in the control of the US government or is it

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Speaker 4: something where it's really in the control of Alsavador and

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Speaker 4: the US government can't do anything about it.

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Speaker 3: Despite the complexities, this is a unanimous decision by the

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Speaker 3: Supreme Court in an immigration case.

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Speaker 4: It is a Nino decision, and any nine oh decision

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Speaker 4: in immigration is very, very very surprising. You even have

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Speaker 4: Justice Alito, who almost never rules against the Department of

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Speaker 4: Justice on immigration, now sign out with a concurrence where

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Speaker 4: you have the three justices sort of my yor Kagan

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Speaker 4: and Jackson saying you have to bring this person back.

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Speaker 4: End of story. You've brought people back in the past,

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Speaker 4: bring this person back. And they're sort of anticipating what's

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Speaker 4: going to happen, which is that this case is coming

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Speaker 4: right back to the Supreme Court. I've actually seen already

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Speaker 4: tweet from the Trump administration saying, what do you want

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Speaker 4: us to do? This person is in Alsavador, they belong

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Speaker 4: to alpha it or end of story, we can't do anything.

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Speaker 4: We've won this case.

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Speaker 3: You may be right, because it's already very contentious in

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Speaker 3: a hearing on Friday, the Trump administration lawyer refused to

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Speaker 3: tell the judge what the government is doing to bring

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Speaker 3: Garcia back or even where he is. Judge Paulsenese asked, quote,

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Speaker 3: this is a direct question, where is he an under

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Speaker 3: whose authority? And the answer from Justice Department lawyer Drew

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Speaker 3: Enson was, we are still internally reviewing the Supreme Court's

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Speaker 3: decision and vetting what we can say to this court.

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Speaker 3: So no answer is there.

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Speaker 4: I mean, I'm sure the district court is going to

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Speaker 4: say this person is in the effective control of the

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Speaker 4: US government, because there's no way that El Salvador would

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Speaker 4: refuse to return this person back to the US if

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Speaker 4: the US insisted. But the question is, by the time

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Speaker 4: this case gets back up to the Supreme Court, is

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Speaker 4: the Supreme Court actually going to take the step of

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Speaker 4: saying that this person is really effectively, for all intensive purposes,

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Speaker 4: in US custody or are they going to allow this

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Speaker 4: sort of separation to exist in the legal sphere and say, well,

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Speaker 4: they're in Alsavador, they're in a Savadoran citizen, and they're

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Speaker 4: under the detention of the al Savadoran government. What really

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Speaker 4: can you force the US to do in this situation.

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Speaker 4: You want them to go to war or something to

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Speaker 4: bring this person back. That's not something a court can do.

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Speaker 4: And so this case is long but over.

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Speaker 3: I mean, in the past, the government has brought people

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Speaker 3: back who've been wrongly deported to foreign countries.

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Speaker 4: Yes, this happens dozens of times per year. There's many

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Speaker 4: times not even reported judicial decisions, because what will happen

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Speaker 4: is the appellate courts won't issue us stay in a case,

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Speaker 4: and then by the time the government actually starts briefing

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Speaker 4: the case, they realize the person had been removed and

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Speaker 4: they say, oh, boy, probably we shouldn't have done this,

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Speaker 4: and the person comes back. So that happened all the time.

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Speaker 4: The difference here is twofold. One. You have an administration

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Speaker 4: that for the first time is contesting this that they

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Speaker 4: even have the legal ability to bring someone back. So

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Speaker 4: you've never had that before. You've always had administrations that

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Speaker 4: are amenable to bringing people back. This is the first

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Speaker 4: one that isn't. But then secondly, this is the first

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Speaker 4: time that you have a foreign national literally in the

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Speaker 4: custody of the country to which they were removed. And

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Speaker 4: so that's a whole new set of facts. If that

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Speaker 4: government had some interest in actually having that person in custody,

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Speaker 4: that would be quite the issue. Now, what makes this

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Speaker 4: even a higher level of complexity is this was literally

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Speaker 4: the exact time that the person got released for, which

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Speaker 4: is that they said, if I get supported to Al Salvador,

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Speaker 4: I will be persecuted by the government and said to

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Speaker 4: some terrible confinement facility where I will be tortured and

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Speaker 4: possibly killed. And so this person is literally living the

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Speaker 4: manifestation of the thing that they were given relief for

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Speaker 4: not to happen. So I cannot say how complicated this

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Speaker 4: is now.

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Speaker 3: This decision came two days after another immigration decision, where

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Speaker 3: the court ruled that the administration can keep using the

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Speaker 3: Alien Enemies Act, a wartime law, to deport alleged Venezuelan

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Speaker 3: gang members, but that the administration has to give the

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Speaker 3: detainees notice and a chance to be heard.

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Speaker 4: So the Supreme Court said that the government can use

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Speaker 4: the Alien Enemies Act at the moment to try to

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Speaker 4: begin a process of defortation, but that people have a

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Speaker 4: right to challenge in habeas a whether you can actually

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Speaker 4: own the merits use the Alien Enemies Act. So yes,

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Speaker 4: they can begin this process, but can the Alien enemies

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Speaker 4: actually be used. But what I mean by that is

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Speaker 4: usually the Alien Enemies Act is invoked in the time

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Speaker 4: of war World War one, World War two, et cetera.

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Speaker 4: This is the first time it's being invoked for the

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Speaker 4: principle that there is a group of people who've committed

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Speaker 4: some sort of informal incursion in the United States for

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Speaker 4: the purposes of destabilizing the country, which is this Venezuelan

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Speaker 4: gang trend that raduas. So that's one analysis. Can it

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Speaker 4: be used for an informal gang as opposed to during

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Speaker 4: an actual declared war? They want the lower courts to

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Speaker 4: hear those arguments and flesh out from logic here before

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Speaker 4: it gets to the Supreme Court. That's number one. But

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Speaker 4: then number two is, even if it can, does the

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Speaker 4: person have the right to say, yeah, but I'm not

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Speaker 4: a member of this gang. I'm from Cleveland, for instance,

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Speaker 4: Why are you deporting me to El Savador or Venezuela

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Speaker 4: or anywhere else? Even I'm a Venezuelan hairdresser that's never

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Speaker 4: set foot in a gang, you know. And so now

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Speaker 4: there is an established Supreme Court decision that says, yes,

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Speaker 4: in habeas you get to make this argument, and also.

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Speaker 3: The detainees have to file the havieas and the jurisdiction

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Speaker 3: they're being held in, which is happening already.

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Speaker 4: So the ACLU went and filed habeases in New York

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Speaker 4: and in the southern districts of Texas, and immediately there

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Speaker 4: were two stays of deportation issued, both blocking the removal

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Speaker 4: and both under the ground that the plaintifs were likely

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Speaker 4: to succeed in their habeases, saying that the alien enemies

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Speaker 4: that could not be used to accomplish the type of

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Speaker 4: deportation that the government wanted the normal immigration court removal process.

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Speaker 4: This is going to be a very interesting process that

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Speaker 4: I think will also get to the Supreme Court about.

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Speaker 4: There's sort of two layers of briefing. There's one are

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Speaker 4: you subject to the alien enemy's acts as it were?

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Speaker 4: Meaning are you actually one of these trend to a

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Speaker 4: Agua gang members? But there's a second, which is should

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Speaker 4: this thing even apply? And should you actually just go

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Speaker 4: to immigration court and be able to make any defense

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Speaker 4: that you want and not be subject to this special

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Speaker 4: type of hearing. So there's both kinds of analyzes, and

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Speaker 4: the courts may need to do both, and we'll see

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Speaker 4: what ultimately works its way up to the Supreme Court.

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Speaker 4: As a result of.

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Speaker 3: This, this administration is certainly keeping the Supreme Court busy.

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Speaker 3: Thanks so much, Leon. That's Leon Fresco of Holland and

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Speaker 3: Knight coming up next on the Bloomberg Law Show. Are

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Speaker 3: Trumps Supreme Court victories more about procedure than substance? I'm

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Speaker 3: June Gross. When you're listening to Bloomberg. President Trump is

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Speaker 3: turning to the Supreme Court over and over again as

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Speaker 3: lower court judges rein in his efforts to push the

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Speaker 3: limits of executive power, and the court's conservative majority seems

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Speaker 3: to be accommodating him with narrow winds that allow his

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Speaker 3: administration to move forward with his agenda deporting alleged Venezuelan

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Speaker 3: gang members, halting teacher grants, and firing federal workers. Is

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Speaker 3: it any wonder that liberal Justice Sonya Soto Mayor, who

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Speaker 3: dissented and all these administration wins, recently expressed concerns about

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Speaker 3: the rule of law.

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Speaker 2: One of the things that's trumbling so many right now

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Speaker 2: is many of the standards that are being changed right

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Speaker 2: now were norms that government that governed officials into what

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Speaker 2: was right and wrong. Once norms are broken, then you're

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Speaker 2: shaking some of the foundation of the rule of law.

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Speaker 3: Trump has been touting these victories, but a close look

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Speaker 3: shows their wins based on procedure rather than on the

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Speaker 3: merits more form over substance. My guest is constitutional law

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Speaker 3: expert David super, a professor at Georgetown Law. David, if

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Speaker 3: my calculations are correct, the Trump administration has made ten

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Speaker 3: emergency applications to the Supreme Court in less than three months.

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Speaker 3: I'm sure that's a record. But why is the Supreme

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Speaker 3: Court addressing so many of these issues?

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Speaker 5: Well, the Trump administration is making sweeping changes in our

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Speaker 5: system of government, changing things that have been understood at

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Speaker 5: least since the New Deal, in many of them since

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Speaker 5: the founding. So these are important enough issues to merit

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Speaker 5: the Supreme Court's attention when they are enjoyed for being unlawful.

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Speaker 3: So last Friday, the Supreme Court allowed the Education Department

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Speaker 3: to withhold money for teacher training projects in eight states.

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Speaker 3: It was a five to four decision to Justice John

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Speaker 3: Roberts sided with the Court's three liberals who would have

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Speaker 3: turned Trump down. Do you see why is with the

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Speaker 3: Court's liberals in that particular.

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Speaker 5: Case, because he didn't write an opinion and he didn't

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Speaker 5: sign the opinions written by the liberal justices. So my

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Speaker 5: sense is that he simply didn't feel that the administration

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Speaker 5: had made a sufficiently compelling case, and he wasn't entirely

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Speaker 5: persuaded by what the conservative majority wrote in their opinion.

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Speaker 3: So did the conservative majority basically go off on a

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Speaker 3: procedural point.

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Speaker 5: Yeah, many of these cases are procedural. The majority is

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Speaker 5: looking with a very powerful magnifying glass at the procedure

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Speaker 5: and in particular about which court something is filed in,

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Speaker 5: and are in three of the most significant cases finding

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Speaker 5: that they don't believe it was in the right court.

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Speaker 5: That says nothing about the merits if the cases get

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Speaker 5: refiled in the court that the Supreme Court prefers. So

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Speaker 5: I don't think we can read very much into it

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Speaker 5: other than that this court is hoping, against hope that

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Speaker 5: if they give the administration a little more time, that

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Speaker 5: it will come into compliance.

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Speaker 6: With the law.

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Speaker 3: Justice Katanji Brown Jackson, in a disense, said it was

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Speaker 3: beyond puzzling that a majority of justices conceive of the

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Speaker 3: government's application as an emergency. I mean, it doesn't appear

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Speaker 3: that there's a real emergency in most of these applications

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Speaker 3: to the court.

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Speaker 5: Now it doesn't. There's no indication that funding these teacher

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Speaker 5: training programs would do any devastating harm. But everything the

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Speaker 5: administration does these days, it claims is an emergency. And

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Speaker 5: their basic theme is that they get to define what

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Speaker 5: an emergency is, no matter how absurd that claim is.

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Speaker 5: And for the moment, the Supreme Court is humoring them

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Speaker 5: on this. My sense is that that game will only

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Speaker 5: work for so long.

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Speaker 3: In probably the most high profile of these emergency petition

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Speaker 3: on Monday, the Court allowed Trump to continue deporting Venezuelan

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Speaker 3: migrants to prison in El Salvador under the Alien Enemies Act,

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Speaker 3: granting an emergency request on a five to four vote

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Speaker 3: without deciding if he was using that law lawfully.

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Speaker 5: Yes, they said that that case should not have been

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Speaker 5: in the district of the District of Lumbia, should have

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Speaker 5: been in the southern District of Texas, and the reasons

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Speaker 5: for that are not silly, but not very compelling either.

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Speaker 5: There certainly were plausible reasons to have filed the case

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Speaker 5: where they did, but I think they're hoping that if

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Speaker 5: they make the case start all over again in the

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Speaker 5: Southern District of Texas as the administration will chalk that

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Speaker 5: up as a whin and back off from its absurd policy.

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Speaker 3: They also didn't address the fact that hundreds of Venezuelan

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Speaker 3: migrants have been shipped to l Salvador already and are

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Speaker 3: in prison there a harsh prison, and Bloomberg News found

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Speaker 3: that just seven out of the two hundred and thirty

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Speaker 3: eight migrants have been found guilty of serious crimes. I mean,

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Speaker 3: they're sending people there based on tattoos and the kind

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Speaker 3: of clothes they're wearing, and the court just let that

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Speaker 3: go by.

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Speaker 5: Well, the court said that there wasn't jurisdiction in the

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Speaker 5: district of Columbia, so they haven't said this is okay.

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Speaker 5: They have instead insisted that all that he's be crossed

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Speaker 5: and all the eyes be dotted before a court takes

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Speaker 5: action on this. Jurisdiction is one of the fundamental attributes

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Speaker 5: of courts, and they do need to attend to their jurisdiction.

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Speaker 5: On the other hand, past courts have been willing to

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Speaker 5: resolve close questions on jurisdiction in favor of getting justice done.

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Speaker 5: And here five members of the Court were not willing

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Speaker 5: to do that.

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Speaker 3: Again, it was five to four, but this time Justice

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Speaker 3: aims Cony Barrett joined the liberal justices any accounting for

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Speaker 3: sort of the Chief and Justice Barrett switching positions in

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Speaker 3: these two cases.

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Speaker 5: I think that both cases, the majority's argument was tenuous,

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Speaker 5: and it wasn't enough to persuade the Chief in the

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Speaker 5: first instance, and it wasn't enough to persuade Justice Barrett

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Speaker 5: in the second instance. Both are signaling that they are

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Speaker 5: not rubber stamps for the administration. But both of them,

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Speaker 5: I think are also signaling that they would like to

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Speaker 5: give the administration a chance to come into compliance on

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Speaker 5: its own. How long their patients will last remains to

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Speaker 5: be seen.

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Speaker 3: Then, on Tuesday, in the first mass firing case to

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Speaker 3: reach the court, the justices bolstered Trump's campaign to fire

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Speaker 3: federal workers, blocking a judge's order that required the administration

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Speaker 3: to reinstate employees. So this was seven to two, with

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Speaker 3: Justices Sotomayor and Katanji Brown Jackson dissenting again based on procedure.

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Speaker 5: Yes, the argument was that these cases should have been

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Speaker 5: brought initially through the merit system's civil service process and

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Speaker 5: resolved there rather than in federal court if there have

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Speaker 5: been one individual person fired based on a quibble over

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Speaker 5: whether they were taking too much sickly, absolutely, the merit

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Speaker 5: system's process would be the right place. When it's being

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Speaker 5: done as a matter of policy on a mass basis

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Speaker 5: without any consideration of individual circumstances, an injunction seems more appropriate.

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Speaker 5: But here the court decided to again insist on jurisdictional perfection.

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Speaker 3: Is the majority sort of checking the easy way out

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Speaker 3: in these cases by making it more about procedure than

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Speaker 3: about the merits or the administration's policies.

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Speaker 5: Oh, yes, very much. So you're not seeing opinion endorsing

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Speaker 5: what the administration has done. That would be very easy

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Speaker 5: for them to write either as an opinion of the

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Speaker 5: court or as a concurring opinion from Justice Alito or whomever.

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Speaker 5: And you're just not seeing that. You're seeing nitpicking on jurisdiction.

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Speaker 5: So no one is sending the administration signs that what

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Speaker 5: it's doing is okay. And I think if the administration's

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Speaker 5: lawyers are paying the least bit of attention, they will

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Speaker 5: recognize that they're being given time but absolutely no encouragement

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Speaker 5: on the merits. If the administration's lawyer, is there any

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Speaker 5: good they're telling them behind the scenes that you're dodging

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Speaker 5: a bullet here and dodging a bullet there, but that

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Speaker 5: the silence of even the most conservative justices on the

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Speaker 5: merits of your action is quite definite. And once the

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Speaker 5: plainness follow the instructions of the court as to how

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Speaker 5: to obtain jurisdiction, the court is giving the administration no

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Speaker 5: encouragement that it will get support on the merits.

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Speaker 3: On Thursday, Trump went to the Supreme Court after the

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Speaker 3: full DC Circuit Court of Appeals reinstated to independent agency

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Speaker 3: officials who had been fired by Trump without cause, and

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Speaker 3: the Chief Justice put that DC Circuit Court decision on hold,

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Speaker 3: so the fired workers remain fired. Does Roberts action indicate

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Speaker 3: support for Trump's efforts to remove any limits on his

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Speaker 3: power to hire and fire.

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Speaker 5: That's not clear. The Chief Justice has previously daid actions

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Speaker 5: of lower courts and then turned around and voted against

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Speaker 5: the administration on the merits, So at the moment, all

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Speaker 5: we could assume is that this stay is an indication

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Speaker 5: that he thinks that all the justices ought to be

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Speaker 5: able to weigh in, which is sensible enough on an

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Speaker 5: issue of this scale. On the other hand, the question

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Speaker 5: of independent agencies may be a more complicated one in

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Speaker 5: the court because several justices have indicated that they don't

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Speaker 5: like independent agencies or don't believe that their independence is appropriate.

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Speaker 5: So on this one, it's certainly is possible that one

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Speaker 5: all is said in times, the administration will succeed in

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Speaker 5: changing constitutional law. I don't like the administration's chances on

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Speaker 5: most of the others.

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Speaker 3: Now, on Thursday night, the Supreme Court handed the Trump

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Speaker 3: administration a high profile defeat when a unanimous court ordered

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Speaker 3: the administration to return to the United States a man

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Speaker 3: who had been deported to l Salvador because of an

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Speaker 3: administration error. Where does that decision fit in this puzzle.

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Speaker 6: Well, I think it suggests that the Supreme Court has

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Speaker 6: its limits, and it's telling the administration that we've now

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Speaker 6: got two unanimous decisions in the scope of a week

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Speaker 6: regarding sending people overseas. The first one found the procedural

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Speaker 6: fault with the case that had been brought, but said

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Speaker 6: that everybody has to be given notice and a chance

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Speaker 6: to ask for a hearing before they can be sent overseas.

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Speaker 6: And then for this gentleman who was sent overseas without

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Speaker 6: any process at all and contrary to law. They've now

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Speaker 6: unanimously told the administration to get him back. That suggests

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Speaker 6: that the Court is trying to give them space, trying

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Speaker 6: to give them leeway, but when it sees serious abuses,

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Speaker 6: it will step in.

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Speaker 3: And why was it important that this was unanimous.

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Speaker 6: It's important because this administration has already shown that it's

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Speaker 6: not very concerned about violating court orders. It's violated many

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Speaker 6: lower court orders. And I suspect that the justices were

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Speaker 6: concerned that if there was a split decision from the

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Speaker 6: Supreme Court, the administration would seize on that to refuse

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Speaker 6: to comply. As well, during the desegregation era, the Supreme

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Speaker 6: Court worked very hard to achieve unanimity, even if the

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Speaker 6: decisions that they wrote weren't as sweeping as they would

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Speaker 6: have liked, just because there was concern that many people

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Speaker 6: were disregarding the opinion. Similarly, in the Nixon Tape's case,

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Speaker 6: was unanimous with the Chief Justice writing the opinion, even

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Speaker 6: though many of the justices would have preferred a stronger opinion.

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Speaker 6: Unanimity was more important.

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Speaker 3: This has been a fascinating discussion Thanks so much, David.

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Speaker 3: That's Professor David Super of Georgetown Law coming up Trump's

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Speaker 3: war on big laws, bringing in close to a billion

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Speaker 3: dollars in free legal services. I'm June Grosso and you're

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Speaker 3: listening to Bloomberg. President Donald Trump's unprecedented attack on big

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Speaker 3: law is yielding him hundreds of millions of dollars in

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Speaker 3: free legal services as many of the top Wall Street

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Speaker 3: firm's cave and settle with the administration, some even before

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Speaker 3: they've been targeted in an executive order we signed with

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Speaker 3: many law firms, the ones that we thought were inappropriate,

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Speaker 3: inappropriate seeming to mean their lawyers acted against Trump, his policies,

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Speaker 3: or his allies in some way. These executive orders generally

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Speaker 3: require that security clearances of a firm's lawyers be suspended,

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Speaker 3: that federal contracts be terminated, and that employee access to

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Speaker 3: federal buildings be restricted. While some firms have chosen to settle,

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Speaker 3: others have chosen to fight Trump in court, where judges

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Speaker 3: have already found his executive orders likely unconstitutional. So why

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Speaker 3: does one firm settle while another litigates? Here to tell

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Speaker 3: us his Bloomberg Law reporter Justin Henry justin how would

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Speaker 3: you describe the firms that are settling.

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Speaker 1: So, the firms that we're seeing settle are primarily concentrated

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Speaker 1: in New York. I think all of them are headquartered

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Speaker 1: or at least originating from New York and have real

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Speaker 1: Wall Street pedigree. They're also much more wealthy, and a

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Speaker 1: lot of that wealth has come from their rainmaker transactional practices,

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Speaker 1: so corporate deals involving mergers and acquisitions and private equity.

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Speaker 3: And explain why the firms that do transactional work want

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Speaker 3: to settle with Trump.

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Speaker 1: So my understanding is that they have really sensitive client relationships,

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Speaker 1: clients who are very averse being in kind of the

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Speaker 1: political limelight. Some of those firms have client relationships that

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Speaker 1: are worth one hundred million dollars a year in revenue

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Speaker 1: or more. And those are client relationships that could vanish

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Speaker 1: literally overnight if their lawyers can't represent them in front

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Speaker 1: of government agencies or get the same kind of attention

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Speaker 1: from regulatory agencies to put the deals through. And then

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Speaker 1: that in a matter of days could decrease the overall

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Speaker 1: profitability of the firm, which would have a cascading effect

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Speaker 1: on other partners at the firm. Making lesson profits and

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Speaker 1: then also being vulnerable approaching by other firms. So you

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Speaker 1: could have a phenomenon that resembles the kind of run

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Speaker 1: on the bank.

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Speaker 3: So they're even afraid that their partners will abandon them exactly.

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Speaker 1: Yeah, and not for any individual lawyer's sort of decision

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Speaker 1: making on the process. It's really a coordination issue where

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Speaker 1: you know, they might want to stay with the firm,

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Speaker 1: the clients might want to stay with the firm, but

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Speaker 1: just because of business reasons, not because of political reasons.

439
00:27:25,359 --> 00:27:27,800
Speaker 1: There's no shortage of other firms looking to scoop up

440
00:27:27,800 --> 00:27:30,160
Speaker 1: that business, and they can come to them and say, hey, listen,

441
00:27:30,160 --> 00:27:33,040
Speaker 1: we're not in the negative limelight of the president. Come

442
00:27:33,080 --> 00:27:36,080
Speaker 1: to us. We still have a good relationship with the administration,

443
00:27:36,200 --> 00:27:38,439
Speaker 1: or at least we're not in the crosshairs of the

444
00:27:38,520 --> 00:27:39,399
Speaker 1: Trump administration.

445
00:27:39,920 --> 00:27:43,000
Speaker 3: Right And with these transactional firms that have to deal

446
00:27:43,080 --> 00:27:46,800
Speaker 3: with the regulatory agencies, it could be a problem if

447
00:27:46,840 --> 00:27:49,960
Speaker 3: they're in the bad graces of the Trump administration.

448
00:27:50,520 --> 00:27:53,400
Speaker 1: Yeah, exactly. I mean, a protracted dispute with the Trump

449
00:27:53,440 --> 00:27:56,600
Speaker 1: administration can make them seem like kind of a para

450
00:27:56,640 --> 00:28:00,000
Speaker 1: politically speaking. That makes clients look at them and say, well,

451
00:28:00,000 --> 00:28:03,199
Speaker 1: all we're worried about not getting good treatment from the

452
00:28:03,240 --> 00:28:07,480
Speaker 1: regulatory agencies that have to approve are massive that the

453
00:28:07,520 --> 00:28:12,439
Speaker 1: company deals. Those very expensive, very lucrative deals require the

454
00:28:12,480 --> 00:28:15,600
Speaker 1: goodwill of the executive branch agencies, and that is something

455
00:28:15,600 --> 00:28:18,240
Speaker 1: that is at risk when you're in a protracted dispute

456
00:28:18,280 --> 00:28:19,359
Speaker 1: with the Trump administration.

457
00:28:19,760 --> 00:28:22,320
Speaker 3: You spoke to Bruce McEwan, who was a former in

458
00:28:22,400 --> 00:28:25,040
Speaker 3: house lawyer at Morgan Stanley, and he said, law firms,

459
00:28:25,080 --> 00:28:28,920
Speaker 3: for all their seeming solidity, are very fragile economically.

460
00:28:29,280 --> 00:28:33,359
Speaker 1: So law firms really aren't organized like any other type

461
00:28:33,359 --> 00:28:36,960
Speaker 1: of business except for other professional services businesses like accounting.

462
00:28:37,240 --> 00:28:40,280
Speaker 1: What makes law firms different is that their shareholders are

463
00:28:40,480 --> 00:28:44,480
Speaker 1: internal to the company, and those shareholders who are the partners,

464
00:28:44,960 --> 00:28:47,960
Speaker 1: have the ability to go to any firm they want

465
00:28:48,440 --> 00:28:50,640
Speaker 1: at the drop of a hat. There are no non

466
00:28:50,680 --> 00:28:53,600
Speaker 1: compete agreements in the legal field like there are in

467
00:28:53,720 --> 00:28:57,240
Speaker 1: other professions, so the law firm can't impose any restrictions

468
00:28:57,600 --> 00:29:01,160
Speaker 1: on one of their lawyers moving to another firm, a

469
00:29:01,200 --> 00:29:03,959
Speaker 1: competitor firm that's willing to pay them more. And so

470
00:29:04,040 --> 00:29:07,800
Speaker 1: that's a huge reason why law firms are much more

471
00:29:07,800 --> 00:29:11,000
Speaker 1: a precarious type of business than other types of businesses.

472
00:29:11,320 --> 00:29:14,000
Speaker 3: And the firms that are fighting back, what are they

473
00:29:14,040 --> 00:29:14,920
Speaker 3: best known for.

474
00:29:15,680 --> 00:29:19,720
Speaker 1: Yeah, so these are firms that are very famous for

475
00:29:19,800 --> 00:29:23,640
Speaker 1: their work in the areas of litigation, and litigation is

476
00:29:23,720 --> 00:29:26,560
Speaker 1: just a practice area that you know, it's still very

477
00:29:26,600 --> 00:29:30,560
Speaker 1: sensitive to politics, but already kind of has an adversarial

478
00:29:30,640 --> 00:29:33,360
Speaker 1: stand by definition, just a breed of lawyers who are

479
00:29:33,480 --> 00:29:36,360
Speaker 1: much more willing to take an adversarial stance, whether it's

480
00:29:36,360 --> 00:29:39,840
Speaker 1: with the government or whether it's with another private sector party.

481
00:29:40,200 --> 00:29:42,240
Speaker 1: And according to the lawyers I've talked to you, that

482
00:29:42,320 --> 00:29:45,200
Speaker 1: kind of has bread a willingness in these firms too,

483
00:29:46,120 --> 00:29:49,080
Speaker 1: in their case take an adversarial stance against the Trump administration.

484
00:29:49,320 --> 00:29:51,840
Speaker 1: Now that doesn't mean it doesn't come with any risk.

485
00:29:51,960 --> 00:29:55,040
Speaker 1: There are risks involved, however, when you're litigating in a

486
00:29:55,080 --> 00:29:59,400
Speaker 1: courthouse as opposed to seeking merger clearance in an executive

487
00:29:59,440 --> 00:30:03,280
Speaker 1: branch agent. See, the courthouses are not subject to the

488
00:30:03,320 --> 00:30:07,320
Speaker 1: Trump administration's executive orders like the executive branch agencies are.

489
00:30:07,960 --> 00:30:11,800
Speaker 3: I didn't realize this. The litigation firms have less revenue

490
00:30:11,840 --> 00:30:13,360
Speaker 3: than the transactional firms.

491
00:30:14,320 --> 00:30:18,600
Speaker 1: Yes, they're on average about half as much in revenue

492
00:30:18,800 --> 00:30:22,800
Speaker 1: every year on average than the more transactional focused firms.

493
00:30:23,040 --> 00:30:24,880
Speaker 1: And that really just goes to show you how much

494
00:30:24,960 --> 00:30:27,800
Speaker 1: private equity and m and A has turbo charged the

495
00:30:27,840 --> 00:30:30,239
Speaker 1: profits of the wealthiest firms right now. But I think

496
00:30:30,280 --> 00:30:32,000
Speaker 1: what we're seeing right now is that it also shows

497
00:30:32,040 --> 00:30:34,160
Speaker 1: you how precarious that wealth is.

498
00:30:34,600 --> 00:30:38,840
Speaker 3: That's why a lot of firms are caving before they're

499
00:30:38,880 --> 00:30:40,960
Speaker 3: even targeted in an executive order.

500
00:30:41,240 --> 00:30:43,240
Speaker 1: There are several law firms that have come to the

501
00:30:43,280 --> 00:30:46,440
Speaker 1: table with the Trump administration in order to negotiate their

502
00:30:46,480 --> 00:30:49,840
Speaker 1: way out of an executive order. When you just look

503
00:30:49,920 --> 00:30:54,640
Speaker 1: at the rationale, the pretext backing these executive orders, it's

504
00:30:54,680 --> 00:30:57,760
Speaker 1: hard to imagine if a high profile law firm that

505
00:30:57,960 --> 00:31:00,960
Speaker 1: Trump might not have a beef with. You know, everybody

506
00:31:01,080 --> 00:31:04,840
Speaker 1: has some connection to a potential enemy of the president,

507
00:31:04,920 --> 00:31:08,680
Speaker 1: and so that makes the potential targets of these executive

508
00:31:08,760 --> 00:31:10,840
Speaker 1: orders pretty far and wide, and that I think is

509
00:31:10,880 --> 00:31:13,560
Speaker 1: making a lot of law firms come to the table

510
00:31:13,560 --> 00:31:16,800
Speaker 1: and try to negotiate preemptively their way out of an

511
00:31:16,800 --> 00:31:17,560
Speaker 1: executive order.

512
00:31:18,320 --> 00:31:22,280
Speaker 3: Tell us about the sequence of firms settling with Trump.

513
00:31:22,800 --> 00:31:25,320
Speaker 1: It started with Paul Weiss, which was targeted in an

514
00:31:25,360 --> 00:31:27,360
Speaker 1: executive order, and then they were able to get that

515
00:31:27,400 --> 00:31:30,880
Speaker 1: executive order rescinded in exchange for the kind of deal

516
00:31:30,920 --> 00:31:34,680
Speaker 1: that we would see three other firms adopt before issuing

517
00:31:34,720 --> 00:31:38,520
Speaker 1: the executive order against them. The firms that proactively made

518
00:31:38,560 --> 00:31:43,760
Speaker 1: deals with the Trump administration include Millbank, Wilkie, and Scattin.

519
00:31:44,320 --> 00:31:47,720
Speaker 1: And these deals have all taken on very similar details.

520
00:31:47,840 --> 00:31:50,760
Speaker 1: What difference is that Paul Weiss committed forty million dollars

521
00:31:50,800 --> 00:31:53,880
Speaker 1: in pro bona services and the other three firms committed

522
00:31:53,920 --> 00:31:55,200
Speaker 1: one hundred million dollars each.

523
00:31:56,000 --> 00:32:01,040
Speaker 3: And then on Friday afternoon, five law firms reached agreements

524
00:32:01,080 --> 00:32:05,719
Speaker 3: with the Trump administration worth hundreds of millions of dollars

525
00:32:06,080 --> 00:32:07,520
Speaker 3: and free legal services.

526
00:32:08,160 --> 00:32:11,320
Speaker 1: Five of the biggest law firms in the world, Five

527
00:32:11,360 --> 00:32:13,680
Speaker 1: of the biggest and wealthiest law fins in the world

528
00:32:14,160 --> 00:32:18,280
Speaker 1: reached deals with the Trump White House to avoid punitive

529
00:32:18,320 --> 00:32:22,200
Speaker 1: action against them in exchange for hundreds of millions of

530
00:32:22,240 --> 00:32:25,680
Speaker 1: dollars in pro bono legal services. The deal that was

531
00:32:25,680 --> 00:32:30,160
Speaker 1: announced on Friday says that Kirkland and Ellis, Latham and Walkin, Simpson,

532
00:32:30,240 --> 00:32:34,000
Speaker 1: Thatcher and Bartlett, Cadwalder and A and O. Sherman are

533
00:32:34,040 --> 00:32:37,640
Speaker 1: committing at least six hundred million dollars in pro bono

534
00:32:37,760 --> 00:32:41,840
Speaker 1: legal services to causes advocated by Trump. That's a combined

535
00:32:41,880 --> 00:32:44,840
Speaker 1: total of six hundred million. There's slightly different numbers for

536
00:32:44,920 --> 00:32:49,120
Speaker 1: each firm. Kirkland and Ellis, Lathman and Walkin Simpson Thatcher

537
00:32:49,600 --> 00:32:52,520
Speaker 1: and Anno Sherman each are committing one hundred and twenty

538
00:32:52,520 --> 00:32:56,960
Speaker 1: five million, while Cadwaller is committing one hundred million, So

539
00:32:57,040 --> 00:33:00,320
Speaker 1: the same as the deals reached by Scadden will Key

540
00:33:00,600 --> 00:33:03,520
Speaker 1: and Millbank. Other parts of the deal are similar to

541
00:33:03,560 --> 00:33:06,960
Speaker 1: what we've seen before. The firms are affirming their commitment

542
00:33:07,040 --> 00:33:10,600
Speaker 1: to quote unquote merit based hiring, and the deal says

543
00:33:10,640 --> 00:33:14,760
Speaker 1: that they will stay away from DEI based hiring. This

544
00:33:14,840 --> 00:33:18,480
Speaker 1: is a joint deal by these firms pledging pro bono

545
00:33:18,600 --> 00:33:19,640
Speaker 1: services for the president.

546
00:33:20,080 --> 00:33:23,200
Speaker 3: So with this latest deal, that means the Trump administration

547
00:33:23,400 --> 00:33:27,600
Speaker 3: is close to a billion dollars in free legal services.

548
00:33:28,080 --> 00:33:30,960
Speaker 1: Nine hundred and forty million dollars in pro bono services

549
00:33:31,080 --> 00:33:34,280
Speaker 1: is my tally. So that aligns with what we heard

550
00:33:34,280 --> 00:33:37,800
Speaker 1: from Stephen Miller at a Oval office event earlier this

551
00:33:37,840 --> 00:33:40,640
Speaker 1: week where he said, you know, at the end of

552
00:33:40,640 --> 00:33:42,680
Speaker 1: this we're getting close to a billion dollars in pro

553
00:33:42,720 --> 00:33:44,400
Speaker 1: bono legal services, and.

554
00:33:44,520 --> 00:33:47,520
Speaker 3: Under these deals, what are the pro bono causes that

555
00:33:47,560 --> 00:33:49,240
Speaker 3: the firms are going to litigate?

556
00:33:49,680 --> 00:33:53,000
Speaker 1: So, just to make it totally clear, what the firms

557
00:33:53,040 --> 00:33:56,160
Speaker 1: have said that have pledged pro bono legal services is

558
00:33:56,160 --> 00:33:59,959
Speaker 1: that they aren't letting the Trump administration call the sho

559
00:34:00,560 --> 00:34:04,080
Speaker 1: down to the individual client relationships. They've just set out

560
00:34:04,120 --> 00:34:08,120
Speaker 1: categories that they need to provide pro bono legal services

561
00:34:07,880 --> 00:34:12,280
Speaker 1: in order to comply with the agreement. And those categories

562
00:34:12,520 --> 00:34:16,480
Speaker 1: include advocating on behalf of veterans' rights. You know, that's

563
00:34:16,520 --> 00:34:21,719
Speaker 1: a very established conservative legal cause. There's combating anti semitism,

564
00:34:22,239 --> 00:34:25,120
Speaker 1: and then there's quote unquote fairness in the justice system.

565
00:34:25,320 --> 00:34:27,600
Speaker 1: There's still a lot of unanswered questions about how they

566
00:34:27,680 --> 00:34:31,840
Speaker 1: will comply with that. You know, I struggle to imagine

567
00:34:31,840 --> 00:34:34,840
Speaker 1: that the law firms and the Trump administration have the

568
00:34:34,880 --> 00:34:38,000
Speaker 1: same definition of those things, especially with something as broad

569
00:34:38,040 --> 00:34:41,320
Speaker 1: as fairness in the justice system. But these are clearly

570
00:34:41,360 --> 00:34:43,960
Speaker 1: areas that you know, Trump for a while now has

571
00:34:44,000 --> 00:34:46,640
Speaker 1: felt like big law isn't as fair to conservatives as

572
00:34:46,680 --> 00:34:49,120
Speaker 1: it is to liberal causes, and so this is his

573
00:34:49,440 --> 00:34:52,280
Speaker 1: way of in his mind, evening the playing field.

574
00:34:52,560 --> 00:34:55,160
Speaker 3: And this week in the Oval Office, didn't he talk

575
00:34:55,200 --> 00:34:58,480
Speaker 3: about new areas for pro bono work.

576
00:34:58,840 --> 00:35:01,680
Speaker 1: Yes, the President in the caterd that he's going to

577
00:35:02,160 --> 00:35:06,200
Speaker 1: commit the law firms to work on behalf of coal

578
00:35:06,239 --> 00:35:10,120
Speaker 1: mining efforts. I think he mentioned leasing, but that is,

579
00:35:10,160 --> 00:35:12,319
Speaker 1: you know, at this point, a vague category that there

580
00:35:12,400 --> 00:35:15,279
Speaker 1: is still some details to be worked out. But I

581
00:35:15,280 --> 00:35:17,600
Speaker 1: think the takeaway is that the President is starting to

582
00:35:17,680 --> 00:35:20,160
Speaker 1: view these deals as like a pro bone of piggybank

583
00:35:20,280 --> 00:35:22,719
Speaker 1: to commit the causes he supports.

584
00:35:23,440 --> 00:35:27,160
Speaker 3: Is this then the end of the executive orders targeting

585
00:35:27,239 --> 00:35:27,880
Speaker 3: law firms.

586
00:35:28,600 --> 00:35:31,080
Speaker 1: I am honestly unsure if there's more firms that are

587
00:35:31,080 --> 00:35:33,920
Speaker 1: going to be targeted. However, this does feel like a

588
00:35:33,920 --> 00:35:38,600
Speaker 1: culmination event. This does seem to be what Trump had

589
00:35:38,640 --> 00:35:41,239
Speaker 1: in mind when he said we are working with five

590
00:35:41,320 --> 00:35:42,719
Speaker 1: more firms to come to a deal.

591
00:35:43,239 --> 00:35:47,000
Speaker 3: Let's turn for a moment to the firms that are litigating.

592
00:35:47,320 --> 00:35:51,799
Speaker 3: So three firms have already sued the Trump administration and

593
00:35:51,840 --> 00:35:54,520
Speaker 3: they've gotten some temporary orders from judges.

594
00:35:55,040 --> 00:35:57,800
Speaker 1: Yes, so all three firms are looking for the executive

595
00:35:57,880 --> 00:36:01,520
Speaker 1: orders against them to be totally halted. But what they've

596
00:36:01,520 --> 00:36:04,440
Speaker 1: been able to get so far are temporary restraining orders

597
00:36:04,480 --> 00:36:09,040
Speaker 1: against parts of the executive orders. I believe the parts

598
00:36:09,080 --> 00:36:11,160
Speaker 1: that they were able to get temporary restraining orders for

599
00:36:11,520 --> 00:36:14,440
Speaker 1: are the parts of the orders that ask agency heads

600
00:36:14,480 --> 00:36:18,839
Speaker 1: to investigate any federal contractors that have relationships with these

601
00:36:18,840 --> 00:36:23,080
Speaker 1: firms for possible termination. That is an issue being raised around,

602
00:36:23,320 --> 00:36:26,239
Speaker 1: you know, keeping client relationships a secret, which is a

603
00:36:26,280 --> 00:36:29,239
Speaker 1: common practice in the world of lawyers. The other part

604
00:36:29,320 --> 00:36:32,320
Speaker 1: that was halted was the one that pertains to access

605
00:36:32,320 --> 00:36:35,480
Speaker 1: to federal buildings. The judges said that you can't bar

606
00:36:36,320 --> 00:36:40,480
Speaker 1: the personalities firms from entering federal agency buildings.

607
00:36:40,600 --> 00:36:44,520
Speaker 3: And how has the Trump administration been defending these executive

608
00:36:44,680 --> 00:36:47,160
Speaker 3: orders which seem like retribution.

609
00:36:47,840 --> 00:36:51,680
Speaker 1: It does, but what people are calling retribution has been

610
00:36:52,200 --> 00:36:56,319
Speaker 1: touched by the Trump administration in the language of protecting

611
00:36:56,800 --> 00:36:59,719
Speaker 1: national security interests, the language that was used in the

612
00:36:59,719 --> 00:37:04,120
Speaker 1: Perk Cooey executive order. The other legal pretext that's being

613
00:37:04,160 --> 00:37:08,000
Speaker 1: cited is anti discrimination law. Was going after firms for

614
00:37:08,160 --> 00:37:11,080
Speaker 1: alleged dei quote unquote discrimination.

615
00:37:11,600 --> 00:37:15,520
Speaker 3: Familiar themes of this administration. Thanks so much, Justin. That's

616
00:37:15,520 --> 00:37:19,200
Speaker 3: Bloomberg Law reporter Justin Henry, And that's it for this edition.

617
00:37:19,200 --> 00:37:21,879
Speaker 3: Of the Bloomberg Law Show. Remember you can always get

618
00:37:21,880 --> 00:37:25,040
Speaker 3: the latest legal news on our Bloomberg Law Podcast. You

619
00:37:25,040 --> 00:37:29,120
Speaker 3: can find them on Apple Podcasts, Spotify, and at www

620
00:37:29,280 --> 00:37:33,560
Speaker 3: dot bloomberg dot com, slash podcast Slash Law, And remember

621
00:37:33,600 --> 00:37:36,560
Speaker 3: to tune into The Bloomberg Law Show every weeknight at

622
00:37:36,560 --> 00:37:40,040
Speaker 3: ten pm Wall Street Time. I'm June Grosso and you're

623
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Speaker 3: listening to Bloomberg