SCOTUS Sends Mixed Signals On Trump’s Firing Of Fed Official

The U.S. Supreme Court sent mixed signals on Wednesday about how it will rule on President Trump’s effort to remove Lisa Cook from the Federal Reserve Board of Governors.

Known as Trump v. Cook, the case focuses on Trump’s August firing of Cook from the Fed over allegations that the Democrat appointee committed mortgage fraud prior to joining the board. As The Federalist reported, a Biden-appointed district judge subsequently granted a request by Cook to block her termination, leading the Trump administration to file an application asking SCOTUS to temporarily pause the preliminary injunction while litigation continued.

The high court deferred on ruling on the application in October until it could hear oral arguments in the case.

While arguing before the bench on Wednesday, U.S. Solicitor General John Sauer contended that Trump possesses the lawful authority to fire Cook and that his doing so over her alleged mortgage fraud satisfies the federal law in question’s “for cause” removal provision. Characterizing her alleged conduct as deceitful and “at best, grossly negligent,” Sauer also pushed back against Cook’s claims that the statute “grants her notice and a hearing” — arguments he said, “contradict[] this court’s cases requiring very clear and explicit language to restrict the president’s removal power.”

Sauer’s first challenge came from Chief Justice John Roberts, who pressed the solicitor general on the level of discretion afforded to presidents on this specific subject and whether he believes courts may review a president’s “determination of cause” for removal at the Fed. It’s a point the chief justice circled back to later on in the hearing, in which he asked Sauer, “If you’re correct that courts do not have the authority to reinstate a removed officer, why are we wasting our time wondering if there’s cause or not?”

“It seems to me that if there is any level of cause, and you indicate that there is some level of cause … then you can’t be right about the idea that courts can’t order anybody who’s been removed to be reinstated,” Roberts said.

Meanwhile, Associate Justice Amy Coney Barrett probed Sauer on what factors the justices should weigh when considering whether to grant the government’s stay application. This included questions about the public interest, potential “risks” stemming from such a grant, and whether the court should take “the nature” of Cook’s alleged crimes “into account in the stay posture in the weighing of the equities.”

Associate Justice Brett Kavanaugh took a different approach. The Trump appointee did not hide his concerns about the “independence” of the Federal Reserve and what should happen if the high court were to grant the administration’s argument that, as he described, “there’s no judicial review, no process required, no remedy available, a very low bar for cause that the president alone determines.”

“That would weaken, if not shatter, the independence of the Federal Reserve,” Kavanaugh claimed.

Kavanaugh went on to note the “real-world downstream effects” of the administration’s arguments and pondered whether the next Democrat president could come in and remove Fed members upon taking office using such logic. While Sauer contended that the hypothetical sounds more like that president has “a policy argument,” the justice noted that “history is a pretty good guide” and that “once these tools are unleashed, they are used by both sides and usually more the second time around.”

“Your position … incentivizes a president to come up with what — as the Federal Reserve former governors say — trivial or inconsequential or old allegations that are very difficult to disprove,” Kavanaugh said. “It incentivizes kind of the search and destroy and find something and just put that on a piece of paper — no judicial review; no process; nothing. You’re done.”

The solicitor general’s arguments also received pushback from the court’s Democrat appointees.

Associate Justice Sonia Sotomayor called Trump’s firing of Cook “unprecedented” and expressed concern about potential “harms” to the Fed’s “independence” if the court “decide[s] these issues too quickly” and without it first being fully litigated in the lower courts. Meanwhile, Associate Justice Ketanji Brown Jackson repeatedly pressed Sauer on what evidence he is relying on to claim that the administration and public will suffer “irreparable harm” if Cook is allowed to remain in her position throughout litigation.

Cook’s attorney Paul Clement also endured his fair share of tough questions from the justices.

Associate Justice Clarence Thomas noted in his query to Clement that the statute in question does not explicitly require Fed members to receive a hearing before their removal. The current court’s most senior justice also probed Cook’s attorney on what such a hearing would “look like and what would the review look like.”

In his follow-up questioning, Roberts expressed confusion as to why Clement would support Cook being granted a hearing for her removal. He noted that Clement’s argument that Cook’s conduct was “just an inadvertent mistake” to justify such a hearing makes little sense, with the chief justice adding, “If your argument is inadvertence, it doesn’t seem to me that there’s much you can say factually other than that.”

Associate Justice Samuel Alito, on the other hand, was much more aggressive in his dissection of Clement’s arguments. The Bush appointee specifically homed in on Clement’s general agreement with the district court that actions pertaining to “for cause” removal “must relate solely to in-office conduct,” and posed a series of hypotheticals concerning serious crimes a board member could commit prior to taking office.

“Suppose that the officeholder was permitted to resign from a previous job under a nondisclosure agreement based on a long and egregious pattern of sexual misconduct. … That would not be cause for removal?” asked Alito.

“I don’t think that would be [inefficiency, neglect, or malfeasance in office] INM. And so, if I’m going to stick to my front-line position, then that would not be for cause. It would certainly be a basis for impeachment,” said Clement, who subsequently stood “with [his] position” when pressed by Alito on if this standard applies to an officeholder who is discovered to have “expressed deep admiration” for Adolf Hitler or the KKK.

Alito also later teamed up with Associate Justice Neil Gorsuch in getting Clement to admit that the president does, in fact, possess the lawful authority to fire Cook.

The Bush appointee’s grilling and Clement’s responses prompted further probing by Barrett, who questioned whether misdemeanor crimes unrelated to a Fed member’s duties could constitute cause for removal. After Clement answered in the negative, Barrett asked, “So, there’s nothing that the president can do to get rid of someone who does those kinds of things while in office?”

Kavanaugh also appeared to express skepticism about the far-reaching nature of Clement’s “for cause” arguments. The justice noted how there are “people who have committed … serious ethical or other wrongdoing digging in and remaining in office” and questioned the availability of congressional impeachment as a solution to such conduct.

“All of which is getting me to the point of I don’t see how the front-line position really can be … the final position without … kind of tilting the balance here too far the other direction from where the solicitor general is,” Kavanaugh said.

A decision in Trump v. Cook is not expected until later in the court’s 2025-2026 term.

Shawn Fleetwood is a staff writer for The Federalist and a graduate of the University of Mary Washington. He is a co-recipient of the 2025 Dao Prize for Excellence in Investigative Journalism. His work has been featured in numerous outlets, including RealClearPolitics and RealClearHealth. Follow him on Twitter @ShawnFleetwood