The Supreme Court has prevented President Donald Trump from removing Federal Reserve Board Governor Lisa Cook, handing the president a significant legal defeat in his effort to increase pressure on the nation’s central bank.
The decision came down 5-4, with Chief Justice John Roberts and Justice Brett Kavanaugh joining the court’s three liberal justices — Sonia Sotomayor, Elena Kagan, and Ketanji Brown Jackson — in the majority.
Trump’s move marked the first time in the Federal Reserve’s nearly 112-year history that a president sought to dismiss a sitting governor.
Under federal law, members of the Fed’s Board of Governors are protected from removal without cause, a safeguard intended to preserve the central bank’s independence from day-to-day political pressure.
The justices ruled that Trump could not immediately oust Cook from the Fed’s Board of Governors. The president had attempted to remove her last August after his housing chief accused her of mortgage fraud.
Cook has not been charged with any crime. Her attorneys have sharply rejected the allegation, calling the misconduct claim “unprecedented and illegal” and arguing that it amounted to a thinly disguised attempt by Trump to gain greater influence over the Fed and push officials toward lowering benchmark interest rates.
During oral arguments earlier this year, the Trump administration’s top lawyer, John Sauer, appeared to face skepticism from several members of the high court, offering an early sign of where the case might be headed.
The justices pressed Sauer on the administration’s decision to try to remove Cook abruptly, without prior notice and without giving her an opportunity to challenge the decision before it took effect.
Even Trump’s own nominees seemed inclined to keep Cook in place. Justice Brett Kavanaugh said allowing Cook to be removed abruptly would not leave room for judicial review, due process, or remedy, should Cook wish to challenge the basis of her removal.
Trump became the first president in the nearly 112-year history of the Federal Reserve to attempt to fire a sitting governor
Then-Federal Reserve Chairman Jerome Powell and Fed Board of Governor member Lisa Cook
The Supreme Court building is seen in Washington, DC. The Supreme Court blocked Trump’s efforts to immediately fire Lisa Cook from the Fed’s board of governors, though it separately cleared the way for presidents to rehape dozens of federal regulatory agencies
‘There’s a very low bar for cause, and one that the President alone determines,’ Kavanaugh told Sauer. ‘And that would weaken, if not shatter, the independence of the Federal Reserve that we just discussed.’
‘No court has ever explored those facts,’ Justice Samuel Alito said of the allegations against Cook, citing concerns about the ‘very hurried manner’ Trump went about calling for her removal.
Federal Reserve Governor Lisa Cook and her lawyer, Abbe Lowell, walk outside the Supreme Court
Lisa Cook, governor of the US Federal Reserve, shakes hands with Jerome Powell after being sworn in to office
President Donald Trump speaks at a conference in Washington, DC. The Supreme Court blocked Trump’s efforts to immediately fire Lisa Cook from the Fed’s board of governors
The Supreme Court’s decision to keep Cook remain in place on the Fed board while it reviewed the case was itself significant.
In recent months, justices have overwhelmingly sided with Trump on emergency stay requests while underlying cases moved forward, including allowing the removal of other quasi-independent agencies.
For Trump, the day was not a total loss. The Supreme Court also green-lit the President’s effort to fire Federal Trade Commissioner Rebecca Slaughter, overturning more than 90 years of high court precedent set in
The 6-3 ruling gives Trump, and future presidents, significantly more power to reshape the boards of dozens of multimember federal agencies — including the National Labor Relations Board, the Consumer Product Safety Commission, and others.
President Donald Trump holds an umbrella as he boards Air Force One
Supreme Court Justices John Roberts Elena Kagan, Brett Kavanaugh, and Amy Coney Barrett
‘If anything more is left of Humphrey’s, we overrule it,’ Roberts said, writing for the majority.
Justice Sonia Sotomayor penned a lengthy dissent, which she read aloud from the bench.
‘Today,’ Sotomayor wrote, the court ‘discards [the] democratic regime created by the Constitution … in favor of one that distorts the structure of Government to fit the majority’s theory of unitary, total executive control.’
‘The result,’ she concluded, ‘is a President who emerges with far greater power than ever before.’
This is a breaking news story and will be updated.
