Now that Joseph R. Biden has been projected as the president-elect of the United States, months and months of speculation has given way to a more clear picture of likely federal-level changes, and which legal practice areas stand to benefit from those changes.
Several industry experts and law firm leaders weighed in on what they expect as the Biden administration begins to take shape. They expect additional work in tax, regulatory and enforcement, state attorneys general, M&A and white-collar practices.
Because practice areas, industry sectors and geographies differ among firms, there is no one-size-fits-all scenario where all tax work increases, or all regulatory work sees an upshot. But there is a general consensus that those areas in particular are ripe for expansion.
Kent Zimmermann, a consultant with The Zeughauser Group, said that there is a “perception that change is coming.”
He expects “an uptick in government investigations and related matters, litigation as a whole and tax changes—to the extent there are changes that Biden campaigned on.”
“Beyond that, there is an indirect result to the extent that progress kicks up on fighting the health crisis, and that causes the economy to bounce back more quickly,” Zimmermann said in an interview. “That will likely benefit a number of practice areas, including private equity and M&A work, in addition to the increases we have already seen in areas such as securities, employment, class-action work and COVID-19-related work.”
Zimmermann did make a point to note, however, that about half of the firms he spoke with about potential changes said the election had little to no effect on how they would plan for the upcoming year.
“A good-sized group doesn’t feel it will affect their performance in a meaningful way,” he said.
Still, at a number of firms the election will usher in some changes in strategy.
Ira Coleman, chairman of McDermott Will & Emery, said tax law, and by association deal work, will become very important in the new year, particularly if the Democrats are able to win two runoffs in Georgia and take control of the Senate.
“If there is a Democratic Senate, you’ll see more tax-related matters come through,” he said. “2021 could be a huge year for M&A if people want to try and get deals done prior to additional taxes going into effect.”
He also foresaw an increase in international trade work, given Biden’s lean toward a more inclusive economic engine.
“Having more multilateralism and engagement on the world stage makes for more investment opportunities,” he said.
Eric Friedman, executive partner at Skadden, Arps, Slate, Meagher & Flom, also expects to see an increase in deal work.
“On the corporate front, we expect global M&A activity—which faced significant hurdles in early 2020 due to COVID-19—to continue the rebound it began in Q3, and capital markets to remain strong,” Friedman said in a statement. “Government enforcement, including areas around FCPA and antitrust, are likely to see increased focus, and tax, bank and other regulatory work tends to increase during any change of administration. We also expect the healthcare/life sciences/biotech, energy and technology sectors to be particularly dynamic.”
Most are in agreement that deal work will increase, as well as technology, life sciences and health care work. But not everyone believes tax work will be a boon for firms in 2021 and forward, especially if the GOP retains control of the Senate.
Ed Newberry, global managing partner of Squire Patton Boggs’ public policy practice in Washington, D.C., said divisions between the political parties might make sweeping change difficult and expects more moderate steps to be taken if changes in tax laws are going to take effect at all.
“It will be hard to rework tax reform in a meaningful way with a Republican-controlled Senate,” he said in an interview. “It will be difficult to make far-reaching change.”
He did say, however, that he expects continued growth in attorneys general practices, regardless of party.
“I think we will continue to see a lot of policymaking battled out at the AG level,” Newberry said. “Some to help advance the Biden administration’s agenda, while others will be looking to stop those initiatives.”
Newberry also pointed out that white-collar work, which had been down during the Trump administration, should see more attention in a Biden administration that seems more amenable to investigations into the financial sector and regulation in general.
Regardless of party affiliation, change in Washington tends to produce work for Big Law and this transition should be no different.
“I think it is fair to say that change in D.C. is good for most law firms, whatever that change is,” Zimmermann said. “Whoever is president, it is key for clients to have an understanding of what firms are known for and lean on that expertise.”