Tariff turmoil may be a boon for global law firms

Stock markets plummeted Thursday, a day after President Donald Trump's announcement of large tariffs against most countries in the world, but international law firms - if they are well-positioned - may stand to benefit at least in the short run, experts said.

"Whenever there is confusion and uncertainty, law firms do well," said Edwin B. Reeser III, former managing partner of Sonnenschein Nath & Rosenthal LLP's Los Angeles office who subsequently worked as a law firm consultant before retiring in 2019.

While governments set policies, foreign companies will need law firms with expertise in the United States to carry out their decisions, whether that means opening a new plant in this country to avoid tariffs, as Trump has urged, or deciding to close one.

Labor and employment attorneys are needed either way, he noted, and tax experts, transactional attorneys and real estate lawyers must be hired - whether the company is buying or selling.

"For the lawyers, I think, on balance, it's going to be a positive because there's going to be a need for legal counsel to help navigate these new rules," Reeser said in a phone interview.

"The stakes are high and time is of the essence," he added. "That's where lawyers live."

Larry Watanabe, founder of legal recruiting firm Watanabe Schwartz in San Diego, agreed.

"Without question, I would expect that major foreign companies, and especially those in China, Japan in the European Union will need to work with U.S. counsel with respect to these matters," he said in an email.

"In the short run, it could well be an economic gain for major law firms in dealing with these matters, but again too early to tell the ultimate fallout and balance," Watanabe added.

The idea that bad economic times, assuming they come, will hurt the legal profession is not a new insight, as some practice areas - such as bankruptcy law - are countercyclical and thrive when struggling businesses and individuals need legal assistance.

Kent M. Zimmerman of Zeughauser Group, a law firm consulting firm, said firms' ability to do well during the ongoing turmoil will depend on how balanced their firm is between cyclical, acyclical and countercyclical practice areas. He said Kirkland & Ellis LLP is regarded as a well-balanced firm.

Bankruptcy is the classic countercyclical practice area, doing best when times are bad. High-stakes litigation is acyclical, as it is not dependent on economic activity, he said. Mergers and acquisition activity usually does best when the economy is doing well.

Law firms dependent on U.S. M&A work may continue to see a slump, given the economic uncertainty since Trump took office. The S&P 500 has dropped 10% since Trump was inaugurated, and sunk 4.84% on Thursday - the largest one-day decline since 2020.

"If you're 70% transactional, you're concerned about recent developments," Zimmerman said, although private equity has done well during the first quarter of 2025 despite the overall stock market's struggles.

"Firms more heavily weighted toward international trade and evergreen regulatory disputes may fare better," he added.

Trump's tariff announcement on Wednesday prompted angry responses from the United States' leading trading partners and longtime allies. French President Emmanuel Macron called on European companies to suspend all U.S. investment and suggested measures to punish the U.S. technology sector in response.

"For U.S. firms overall, I don't think the trade policy is a positive because of the uncertainty," Zimmerman said.

But Reeser said the turmoil creates opportunity for multinational firms, whether they are U.S. firms with overseas offices or foreign firms that have opened offices in the U.S.

"If they can get the business, they're going to want it," he said. "The deals are big, so there are lots of fees. And there could be an ongoing relationship" as a result.