So here's what happened: the District Attorney, Arthur Branch, called Serena into his office told her she was an excellent attorney but was unsuited for prosecutorial work, and fired her. Not the most dramatic send-off a Law & Order cast member has ever received, but acceptable.
Then Serena sighed and said, "Is this because I'm a lesbian?" Now, that was a surprise. I have no memory of Serena's sexual preference ever having been mentioned before. Maybe it has been brought up in other episodes, but I have no recollection of it. And I find it somewhat hard to believe that they would have mentioned it for the first time during her last 15 seconds on the show. But who knows, maybe Dick Wolf is crazy enough to do something like that.
Just for the record, Arthur said, seemingly as surprised by the question as I was, "No. Of course not. No." To which Serena replied, "Good. Good."