What the New Congress Means for Small- and Mid-Sized Firm Lawyers

On the night of the inauguration, Katy Perry capped a day of great pomp and circumstance with a celebratory performance of “Firework” that lit up the D.C. sky. It was an exclamation point on a day marking the momentous transition from one presidency to the next. But a far more serene event that unfolded in the capital more than two weeks earlier is likely to have a bigger near-term impact on the professional lives of practicing lawyers. We’re speaking about the convening of the 117th Congress. The Georgia run-off elections for the final two Senate seats in that Congress tipped to the Democrats, changing the power dynamic in Washington, D.C. — and creating the possibility for Congress to pass legislation of great interest to solo and-firm attorneys.

The new Congress should feel markedly different from the divided 116th iteration, during which the Democratic-controlled House passed a raft of legislation only to watch it languish in the Republican-controlled Senate. Most notable perhaps was the “For the People Act,” a voting rights package that was one of nine high-priority bills that the House passed after the 2018 midterms. Those bills covered hot-button political issues from background checks on firearms to an expansion of the Affordable Care Act, and House Democrats plan to reintroduce them in the 117th Congress. (They have already done so in the case of the For the People Act.)

It remains to be seen whether the more partisan makeup of the 117th Congress will facilitate the passage of this ambitious legislation. But plenty of other proposals, some more likely to pass, affect common legal practices at small and mid-sized firms. Here are five of particular interest.

Biden Relief Package

In a prime-time address, President Biden made an argument to the American people — and the 117th Congress — for a $1.9 trillion “American Rescue Plan” to meet the dire economic and health care needs brought on by the pandemic. If he manages to push it through Congress, the bill could spur legal work in multiple areas. The methods for boosting the economy in the Plan include a mandate for 14 weeks of paid sick and family leave for a large swath of the workforce, which could keep labor and employment lawyers busy for a while. It also includes grant money for more than a million small businesses, which may need guidance in that process, as well as tens of billions for low interest loans in areas like clean energy.

Despite the nearly $2 trillion price tag, President Biden sees it only as a stop-gap measure. He plans to unveil an even more ambitious package in his first appearance before the 117th Congress.

Bankruptcy

If Senator Elizabeth Warren (D-MA) has her way, bankruptcy lawyers could be doing a booming business in 2021. Observers already expected a surge in bankruptcy filings with so many Americans out of work during the pandemic. But the former presidential candidate has put forward a proposal that would make more people eligible for bankruptcy protections. She has the backing of President Biden, who back in 2005 helped Republicans pass a bankruptcy bill lacking consumer protections that liberal Democrats desired. Now he’s on board for letting people discharge student loan debt in bankruptcy and preserve the equity they’ve built in cars and homes. Whatever the specifics, an easier path to bankruptcy could be good news for practitioners in the field.

Revamp of Section 230

Rarely have more words been spoken about a subject that so few people understand as “Section 230.” That law, passed in 1996, strikes a bargain that gives websites (such as Facebook) immunity from civil liability for user-generated content (like defamatory posts). Now that technology firms have become something of a punching bag in Washington, many are taking aim at this immunity shield. Former Preside Trump even vetoed a defense spending bill because it failed to repeal Section 230. That veto was overridden, but that doesn’t mean Congress is happy with the law.

Politicians from across the spectrum have been calling for it to be reconsidered. In fact, Politico reports that a couple of reform proposals have bipartisan support. If and when they pass, any erosion of Section 230 immunity should create opportunities for litigators.

Immigration

Immigration was a massive point of contention during the last presidential administration, so we can expect to see push-back with the federal government now under Democratic control. This is one area, in fact, where it may not even take Congressional action to undo many of the policies enacted in the last four years. From 2016-2020, the White House pushed through much of its immigration policy by executive order — including those that restricted travel from Muslim-majority countries, limited guest workers and terminated the “Dreamer” program (aka DACA).  

President Biden will reportedly be making immigration a major priority. One action he could look to reverse is a highly controversial order from June 2020 to limit H1-B visas for skilled workers. That order kept out half a million workers and incensed business leaders. A reversal by the Biden administration could create welcome work for immigration attorneys.

Consumer Protection

For Congress, there’s one go-to move that follows national emergencies on the scale of the pandemic: consumer protection legislation. In the wake of the Great Depression, Congress created the Federal Deposit Insurance Corporation (FDIC), guaranteeing bank deposits. After the 2008 financial crisis, Congress created the Consumer Financial Protection Bureau (CFPB) to regulate mortgages and other financial products. Perhaps unsurprisingly, consumer complaints to the CFPB reached record highs in the pandemic.

Conditions would appear ripe, then, for some form of consumer protection legislation. One potential measure would make it easier for consumers to cancel subscriptions and automatically renewing services like gym memberships. Amazon Prime is a particular target, and consumer groups say that the many prompts in its cancellation process make use of psychological “dark patterns” that are prohibited in California. Regardless, any consumer protection legislation with a private enforcement mechanism is sure to create opportunities for small and mid-sized practices.

It’s difficult to say that any of the above measures are a certainty in 2021, given the Democrats’ narrow numbers in the Senate House. But it’s likely that some will pass — even if their signing into law won’t be accompanied by fireworks on the National Mall.