As of Thursday morning, the only announcements from large, U.S.-based law firms have been that several firms are cutting ties with particular Russian clients as a result of sanctions against Russia, but as long as the invasion continues, the likely next step will be office closures, according to two law firm management consultants who serve the European market and an international law expert.
Especially as a number of big corporations have announced they're cutting ties with Russia in recent days, including large energy companies and technology giants, law firms are sure to follow, said Alexander Gendlin, managing partner of consulting firm Law Business.
"The presence of big law in Russia will be reduced significantly," Gendlin said. "Also, of course, if clients such as BP, Shell and the likes are withdrawing from Russia they will not expect their lawyers to continue having major presences in Russia."
But the pressure on law firms to exit the country goes beyond following clients as work dries up there, said Carole Silver, professor of global law and practice at Northwestern University Pritzker School of Law.
"From a reputational perspective, I do not see a way for these global law firms ... to justify maintaining an office in Russia," Silver said. "The reputational benefit that firms generally seek through establishing and growing international offices has been eviscerated in these circumstances by Russia's aggression."
On Wednesday, Harvard Law School student Ryan Donahue made the news when he posted to social media that he had turned down a summer associate position at a large law firm in New York because the firm had a continued presence in Russia and refused to cut ties with clients there.
A few law firms have announced they are dropping some but not all of their Russian clients, mostly as a result of economic sanctions. Those include Baker McKenzie, Venable LLP and Sidley Austin LLP. Allen & Overy LLP and Norton Rose Fulbright also said they are reviewing their client relationships and plan to terminate some.
Additionally, U.K. law firm Kennedys and Swedish law firm Mannheimer Swartling have both announced they are winding down their operations in Russia, according to U.K. publication Global Legal Post.
But the list of large law firms in Russia is long, and many have a substantial and long-standing presence there.
In 2014, 17 of the Law360 Global 20 had offices in Moscow. Following Russia's annexation of Crimea in 2014, a handful of firms scaled back operations in the country, and by 2019, three of those firms had closed their Moscow offices. Today, those same 20 law firms still have 14 offices in Moscow.
Baker McKenzie and Dentons have offices with more than 100 lawyers in Russia, and a number of others have more than 50 attorneys. Several have offices both in Moscow and St. Petersburg.
A representative for Dentons told Law360 Pulse that the firm is conducting a thorough review of existing work and new business acceptance criteria "in light of the rapidly accumulating sanctions." A request for comment to Baker McKenzie was not immediately returned.
The sheer volume of attorneys in Russia, some of them Russian and some from outside the country, is likely part of why BigLaw has not made a move even as clients are pulling out of the country, according to Tony Williams, a law firm management consultant at Jomati Consultants LLP.
Williams said it's "almost inevitable" that firms will draw back from Russia, but in some cases they can't drop clients immediately, such as if they have signed a retainer agreement with a client that isn't on the sanctions list.
Law firm leaders also may feel a responsibility toward their lawyers in Russia who may want to leave the country but can't because airlines are not flying between Russia and Europe.
"Clearly firms will be going through that process and some I'm sure may well decide it's going to be appropriate to do something in relation to their Moscow offices," Williams said. "Whether they keep their offices in their current form and say, we'll only act for fully compliant people, or whether they'll close, those are the sorts of discussions and thought processes firms will go through."
"It's not an easy knee-jerk answer," he said. "You have to be able to communicate that clearly and honestly to your people on the ground."
Gendlin said that so long as Russia continues its invasion of Ukraine and economic sanctions and travel restrictions persist, "from a certain point a new iron curtain might come down where getting in and out will be as difficult as in Soviet times."
"It's hard to say how fast or long it all will go," he said. "But it is safe to say that even if Putin will somehow be forced out of office, anybody who will be next in line must first prove himself before the sanctions are lifted and the skepticism towards Russia is lowered, and both will take years."
--Additional reporting by Rachel Rippetoe. Editing by Brian Baresch and Alyssa Miller.
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