Let's be Machiavellian about this:
1) Reed Smith has represented the university in this mess, at times. They know where the bodies are buried.
2) Pepper, due to its association with Freeh, is wounded.
3) Reed plays hardball with Pepper. Knows what is coming. Says to Pepper, you sell to us now, or we sell you down the river later.
4) Reed gets Pepper on favorable terms, and Freeh gets cut loose.
Reed and PSU are then in a position to go after Freeh later, if/when needed.
I made that all up, but it seems plausible. Out of the blue, Reed Smith is talking to Pepper about merging.
