Karpenstein: Great concern
US law firms that struck deals with President Trump to avoid punitive executive orders are at risk of losing their right to operate in Germany, its bar association has warned.
Evidence that the firms’ independence has been compromised by the deals could lead to disciplinary action, according to the Deutsche Anwalt Verein (DAV) – the German Bar Association – in a position paper entitled US law firms in Germany and the independence of lawyers.
Nine law firms have so far reached agreements with the Trump administration to provide, between them, $940m of pro bono legal advice among other things.
In return, they avoided executive orders that have been used to sanction other law firms that acted for opponents or investigators of the president – although the courts have been striking down those orders.
The DAV said: “Whether these (undisclosed) agreements also contain the condition that the law firms concerned do not act against the Trump administration can only be assumed. It seems most likely.”
The position paper said that an agreement under which lawyers “relinquish their independence from the government are therefore likely to prove unlawful under the German law on the lawyer’s profession”.
This was more likely to affect US firms operating as foreign practices in Germany than those that had separately incorporated businesses in the country. The latter could face investigation “in exceptional cases”, for example if the majority of the shareholders of both the US and German operations were the same.
Lawyer independence from government is a particularly sensitive issue in Germany because of the experiences during the Nazi and East German regimes.
If there were indications that a firm’s independence had been violated, the local bar association could initiate disciplinary proceedings.
If it decided to take action, the bar association could reprimand the firm or refer it to the local public prosecutor’s office for possible action before the Lawyers’ Disciplinary Court. The most severe sanction the court can impose is to withdraw the firm’s authorisation to provide legal services.
The position paper also referenced the 20 law firms asked to provide information about their diversity, equality and inclusion (DEI) policies by the US Equal Employment Opportunities Commission.
“In this climate, a number of law firms have discontinued their DEI programs, concealed them or otherwise modified them in such a way that they offer no or less of a target for the Trump administration,” it noted.
According to media reports, the DAV went on, at least four firms have committed to engage external lawyers to monitor their compliance with “federal anti-discrimination laws and with the terms of their agreement”; the external lawyer must submit a confidential written certification to the White House every six months.
The DAV said that, while abolishing or amending DEI policies did not “demonstrably violate the obligation of independence”, those firms with the compliance deals – “where independence from the government could be jeopardized by the formal obligation to grant the government control over the waiver of DEI measures” – may have to be “assessed differently”.
DAV vice-president Dr Ulrich Karpenstein said: “We have observed this very rapid development with great concern and asked ourselves what kind of impact such agreements have on US law firms operating in Germany, who are subject to German professional law, as well as on our colleagues working for them.”
He stressed that the core value of lawyers’ independence “primarily means freedom from dependence on the government”.
Professor Dr Thomas Gasteyer, chairman of the DAV’s committee on professional practice – which drafted the position paper – said that even if a firm did have its authorisation removed, the impact on its lawyers working in Germany would be “serious but limited”.
He explained: “The individual admission and the possibility of working together in other professional partnerships would remain unaffected for our colleagues.”
Separately, German law firm Redeker Sellner Dahs has awarded US attorney and former Skadden associate Rachel Cohen the Konrad Redeker Prize for Rule of Law, Courage, and Resilience.
It recognises how she stood up against the deal that Skadden signed, organising an open letter for associates to condemn the government’s actions and then resigning from the firm.
“With her bravery, courage and commitment, Rachel Cohen has contributed to galvanizing broad and vocal resistance against the US administration’s attacks on the legal profession,” said Redeker partner Dr Roya Sangi. Dr Karpenstein is also a partner at the firm.
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