Trump Attack on Covington Contracts Shows Firms’ Risk (Correct)

President Donald Trump’s directive to review government contracts with Covington & Burling shows the risk for Big Law firms working with US agencies.

Firms should prepare for the possibility of negative exposure through Trump administration examinations, said Evan Nierman, chief executive of crisis communications firm Red Banyan. “What smart organizations understand is the best time to combat a crisis is before you have one,” he said.

Trump in a Feb. 25 memo directed agencies to review contracts with Covington and “align their agency funding decisions” with citizen interests. He criticized “the weaponization of our system by law firms” as Covington gives pro bono legal aid to Jack Smith, who brought two criminal cases against the president. The memo also told agencies to suspend security clearances for Covington employees who assisted Smith.

Bloomberg Government’s database shows no US contracts for Covington, but other large law firms receive millions from the federal purse. Ballard Spahr, Norton Rose Fulbright, and Morrison Foerster have each received contracts worth more than $10 million since 2021, the database shows.

The Elon Musk-led effort to cut spending has resulted in the cancellation of hundreds of contracts, many of which he criticized on X, the social media platform he owns. No Big Law contracts have been singled out, but one Department of Government Efficiency post referred to a $25,000 award that in part provided legal support for LGBTQIA+ refugees in Greece. The post didn’t name the entity that got the grant.

“The story of DOGE that is emerging is that the choices it’s making are highly political,” said Walter Olson, a fellow who writes on law at the Cato Institute, which advocates for limited government.

Trump’s memo created a chilling effect as lawyers worry about retaliation for representing parties with an adversarial relationship to the administration, Olson said. “The legal profession has to be free to take on unpopular clients or clients who differ with the administration, and this is an attack on that,” he said.

Arnold & Porter

At least one firm that holds a government contract represents a client in a case challenging Trump’s administration. Arnold & Porter represents foreign aid recipients, including Global Health Council and Management Sciences for Health, in a challenge against Trump’s foreign aid freeze. The law firm did not respond to a request for comment.

Arnold & Porter since 2021 has $5.3 million in contracts with the federal government, according to Bloomberg Government’s database. The firm worked on a sovereign loan guarantee for the US Agency for International Development, which has been a top DOGE target.

“DOGE is going to look at hot-button, red-meat issues that Trump campaigned on, like foreign aid and DEI,” said Joe Heaton, a lawyer at Ice Miller. Companies, including law firms, are reviewing public-facing materials for language that affiliates them with such issues, he said.

Big Law firms would see little effect on their bottom lines if their federal government contracts are revoked. The 55 largest law firms in the US as tracked by the American Lawyer all topped $1 billion in revenue in fiscal 2023.

Covington

Covington is a prominent Washington, DC law firm with a deep roster of lawyers from Democratic administrations, including Eric Holder, attorney general under President Barack Obama, and Dana Remus, White House counsel under President Joe Biden. Covington is among several major law firms leading lawsuits against the Trump administration over a slew of executive orders.

Trump’s memo singles out partner Peter Koski, who began representing Smith when it became clear Smith would become the subject of a government investigation, according to Covington.

Koski joined the firm in 2018 after serving as deputy chief of the Justice Department’s public integrity section.

In private practice, he represented an FBI agent in connection with the John Durham investigation into the origins of the federal probe into possible Russian interference in the 2016 presidential election. He also represented Remus in her response to a congressional inquiry about Biden’s removal of classified White House documents, according to a letter reviewed by Bloomberg Law.

Covington partner Lanny Breuer is also representing Smith, according to a person familiar with the matter. Breuer rejoined the firm in 2013 after serving as assistant attorney general in the DOJ’s criminal division under Obama. The Wall Street Journal first reported Breuer’s role. Covington declined to comment.

“Half the conduct of Trump is for PR and some of it is only for PR,” said Stephen Gillers, a legal ethics professor at New York University Law School. “Going after Covington warns other law firms, wherever they are on the political spectrum, they better not copy Covington.”

— With reporting by Mahira Dayal