the Federal Trade Commission (FTC) shifted the legal battleground over corporate diversity. In letters sent to 42 major law firms, the agency warned that coordinated Diversity, Equity, and Inclusion (DEI) initiatives may violate federal antitrust laws by acting as a “labor cartel.”
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- The “Mansfield” Conflict: The FTC specifically targeted firms using the Mansfield Certification, which requires a 30% diversity threshold for candidate pools. The agency argues this “collusion” restricts the free market for legal talent.
- Price-Fixing Analogy: Just as firms cannot agree on what to charge clients (price-fixing), the FTC suggests they cannot agree on specific “rules” for whom they will or will not hire.
- Information Exchange: The FTC warned that “knowledge-sharing calls” between firms regarding their diversity progress could be used to illegally exchange sensitive data on compensation and hiring strategies.
Implications for “Big Law”
The warning letters were sent to several of the world’s most profitable firms, including Covington & Burling, Hogan Lovells, and Perkins Coie. This signal from the FTC indicates that:
- DEI is now a “Regulatory Risk”: Firms must now worry about antitrust investigations, not just private lawsuits.
- Standardization is Dangerous: The more “standardized” a diversity program is across the industry, the more likely the FTC is to view it as an illegal agreement between competitors.
The Broader Trend
This move aligns with a 2026 administration-wide crackdown. Following the EEOC’s 2025 settlements with firms like Skadden and Latham & Watkins, the FTC’s involvement suggests a “pincer movement” designed to force the legal industry to abandon race-conscious hiring entirely.
Bottom Line: The FTC is treating law firm hiring pools like any other market. If firms coordinate on how they select candidates, the government will treat them as a cartel rather than a group of peers pursuing social goals.
