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Hypothetically, if a firm were to pull an offer right before a start date and this person had that offer outstanding for over a year (think clerkship)… how screwed is she? Done nothing wrong btw. Scared to think of all the things that follow: possible months/year of unemployment, no health insurance, no warning, it goes on. I don’t understand. What do I do?

That sucks; I'm sorry. Just apply to other firms and jobs like you normally would. It's not uncommon for people to take a few months off in between jobs, so you could play it off like you planned to do something leisurely for a few months after your clerkship like backpacking across Europe or something like that. Or if the rescission of the offer from the other firm truly isn't your fault, then you could just be really transparent and explain if someone asks: "I was planning to go to X firm, but then X firm rescinded the offer due to a restructuring" or something like that.