The National Law Journal

Call for Nominations: Elite Trial Lawyers 2025

Senate Judiciary Dems Release Report on Supreme Court Ethics

'Further Investment in Power' Will Drive Big Law Business—But What About Clean Energy Projects?

As Big Law Moved Into Texas, Homegrown Firms Expanded Out, in 2024

Positive 2024 financials in Big Law will likely lead to more cash flow that should be available for law firm innovation, industry analysts say. In particular, law firm leaders are looking to 2025 to further leverage generative artificial intelligence to transform their business. "Law firms will do pretty well this year, and then they'll have the capital to really spend robustly next year," said Carlos Pauling, an executive director and recruiter with Major, Lindsey & Africa. Innovation, Pauling said, "is at the top of all of their strategic priorities list." Looking ahead to 2025 and beyond, law firms will continue to work through the hype and keep up with the rapid developments of gen AI technology, confirms a new Citi Hildebrandt advisory report, based on law firm leader discussions. Implementing gen AI is going to be expensive, the report said. “But so far, firms have actually spent very little—with the vast majority of large firms telling us they spent less than 1% of their revenue on gen AI-related technology, consulting and staffing in 2023. We expect that will change over the next two years,” the report said. But firms that don’t make the investments, taking instead a wait-and-see approach with AI in 2025, will likely be left behind, Pauling said, while firms envisioning incorporating AI into their respective practices will have a competitive advantage. "They're the ones who are going to be able to capture market share because they're going to be able to service clients in a more comprehensive and robust way and they're going to be able to attract new talent," Pauling said. Going forward, gen AI is anticipated to transform many areas of law firms, including leverage and delivery of legal services. But firms in 2025 are expected to make investments in staffing, training, security and infrastructure in order to leverage AI, industry experts say. Full story from Jon Campisi: https://lnkd.in/egdrSaVk

Resignation is the typical path for agency chairs in Khan's situation. And that's the playbook that Securities and Exchange Commission Chair Gary Gensler drew from when he announced Nov. 21 that he will resign on Inauguration Day. But Khan hasn't revealed her intentions, and sticking around as long as possible might be her best way to preserve aspects of her agenda many Republicans view as too left-leaning. Khan's term as commissioner actually expired in September, but she is free to remain in the role—leaving Andrew Ferguson with the bully pulpit that goes with being chair but keeping the panel under Democratic control—until the Senate confirms her successor, which could be many months, depending on how Trump prioritizes his confirmation fights. If Khan does opt to resign, the panel would have a 2-2 Republican-Democrat split, which could result in a deadlock on matters such as whether to challenge a particular merger on antitrust grounds, noted Gerald Stein, a partner at Davis Wright Tremaine. “Some of the more politicized cases might end up in ties, and you can’t enforce without a majority,” Stein said. How Ferguson might differ from Khan is a matter of intense speculation, though he's widely expected to follow Khan's hard-line enforcement of antitrust laws against Big Tech while taking a less interventionist approach to mergers in other industries. Ethan Wong, associate product counsel at Google, said he expects the FTC will continue the agency's crackdown on the veracity of claims by social media influencers. Peri Fluger, the general counsel at the global communication and creative agency Ruder Finn, said that any material connection between endorser and advertiser must be revealed to consumers. “It doesn’t necessarily have to involve money, It could be a personal or business relationship, "Fluger said. “You have to disclose this." Full story from James Palmer: https://lnkd.in/eBX7fb-P

Conservatives' misconduct accusations against Democratic-appointed judges who canceled retirement plans after Donald Trump’s election win face long odds at success, ethics experts said. Sen. Thom Tillis, R-North Carolina, has urged the Senate Judiciary Committee to hold a hearing over U.S. Court of Appeals for the Fourth Circuit Judge James Wynn’s (below) post-election rescission of his senior status, saying ethics complaints would be deserved. And a conservative group, The Article III Project, has pressed for an investigation, stating that U.S. District Judge Max Cogburn Jr.'s timing creates the appearance of being guided by politics and raises questions about judicial impartiality, in potential violation of ethical canons. “Perhaps Judge Cogburn has legitimate reasons for withdrawing his senior-status letter," stated the group's complaint against the Western District of North Carolina jurist. "But on the public record as it currently exists, every indication is that he had a change of heart solely because of the outcome of the 2024 presidential election. If that is proven, it would violate several Canons of the Code of Conduct of United States Judges.” Michael Gerhardt, a University of North Carolina at Chapel Hill law professor who studies judicial ethics, said the complaints improperly put the burden on the judges to prove their innocence. None of the judges have stated why they rescinded senior status. “There’s nothing unethical about it at all. A judge is allowed in the system that we have to change their mind," Gerhardt added. "I think it's just silly to turn everything that somebody disagrees with politically into some kind of misconduct and reason for investigation.” Full story from Avalon Z.: https://lnkd.in/eZm6bZCp

Government attorneys have been inundating the job market in Washington, D.C., even before the election results were in. However, the overcrowded market is forcing some attorneys to take a pause on their search for the moment. Resumes of President Joe Biden's political appointees who will be out of a job in January and high-level officials coming out of that administration will be at the top of the candidate pile at law firms, while midlevel and career attorneys are more likely to float to the back, according to several D.C. area legal recruiters. “Law firms are prioritizing the political appointees and the very senior officials, the division heads, the chairs, folks with really significant titles, and [those senior candidates] probably will demand quite an investment of money to afford,” said D.C.-based recruiter Rachel Nonaka at Macrae. Even as law firm demand for government talent hasn't exploded, area recruiters say they are hearing from a high volume of candidates. “It is truly remarkable how many phone calls we are getting and how many candidates we have on the market right now. I mean, honestly, I have not seen anything like this,” said Nonaka. D.C.-based recruiter Jeffrey Lowe at CenterPeak said he saw more candidates start their job search “earlier this year than in any of the previous 20-plus years,” followed by a “flood immediately following the election.” President-elect Donald Trump's nomination of Rep. Matt Gaetz, R-Florida, for U.S. attorney general prompted a number of calls from attorneys in the government, particularly career attorneys, to recruiters inquiring about their options. However, Gaetz’s withdrawal and then Trump’s subsequent nomination of Pam Bondi, former Florida attorney general, has some candidates rethinking whether they should stay in government. “At first, candidates asked, ‘Can you get me out by early January?’ And now the approach is more, ‘OK, I can take a breath. I can wait for the right opportunity instead of just the first opportunity,” said D.C.-based recruiter Amy Savage at Garrison. Full story from Abigail Adcox: https://lnkd.in/ehguQn-n

The U.S. Supreme Court on Wednesday agreed to hear a dispute between South Carolina and Planned Parenthood over the state governor's 2018 decision removing the abortion and family planning organization from the list of eligible Medicaid providers. In a short order, the court said it would review whether private individuals have a right to sue to enforce the Medicaid Act's guarantee that Medicaid recipients can choose their own qualified medical providers under the program. South Carolina's top health official is appealing a lower court's decision that individuals such as plaintiff Julie Edwards, a Medicaid patient who received family planning care at Planned Parenthood South Atlantic, can use a federal civil rights law to sue under the Medicaid statute. Robert Kerr, director of the South Carolina Department of Health and Human Services, has argued that the lower federal courts are deeply divided over the question of whether plaintiffs can use §1983 of the 1871 Civil Rights Act to enforce the any-qualified-provider provision of the Medicaid Act. "This Court should grant review and resolve these entrenched splits. Whether a private party can drag a state into federal court for disqualifying a provider should not turn merely on where that state is located," stated Kerr's successful petition for Supreme Court review. The petition was filed by lawyers at the conservative Christian legal advocacy group Alliance Defending Freedom and South Carolina-based Jolley Law Group. Full story from Jimmy Hoover: https://lnkd.in/eXxMNQWU

The U.S. Securities and Exchange Commission has issued a Wells notice to CyberKongz, a blockchain company deeply rooted in gaming, regarding its alleged failure to register a token as a security. CyberKongz, which announced the action on X, has become the second gaming company in recent months to face regulatory scrutiny. Andrew Balthazor (right) of Holland & Knight in the Am Law 100 firm’s Miami office noted that the social media post was consistent with those of other crypto companies that are subject to potential regulatory actions “that they almost make it like a badge of honor within the industry and publicize that they are nearing the enforcement action ahead of an actual public filing.” “Three years ago, amidst the crypto winter of the FTX and Celsius failures, there was a hard look at virtually every major code-based project that could potentially be harming consumers by violating securities laws, and we’re seeing the fruits of it now,” Balthazor said. “Gaming consumers aren’t typically knowledgeable investors to the extent they are encouraged to purchase something that looks, smells and talks like an investment that violates security laws.” Sylvia Favretto, associate general counsel at Mysten Labs, who is not involved in the matter, said SEC Chair Gary Gensler and his enforcement division are attempting to push forward as much of their “regulation by enforcement” agenda as possible ahead of his resignation on Jan. 20, the day of President-elect Donald J. Trump’s inauguration. “In the absence of claims of fraud, an action against either of these companies has a very low chance of coming to fruition if not initiated before Gensler's departure,” Favretto said. “Even if enforcement actions were to commence, it is likely that the SEC would either later withdraw or settle, in line with what will likely become of the other active matters.” Full story from Michael A. Mora: https://lnkd.in/etnzdDgQ