The Supreme Court makes a big exception for the Fed. 
A Big Exception for the Fed
The Washington Post reports Supreme Court Blocks Trump’s Fed Firing
The Supreme Court on Monday blocked President Donald Trump from immediately firing a Democratic appointee to the Federal Reserve Board, a major ruling that preserves the independence of the powerful central bank, which guides the U.S. economy.
The 5-4 decision is a setback for Trump, who has complained that the Fed is not dropping interest rates quickly enough and has pushed aggressively to exert greater control over federal agencies that Congress set up to be insulated from influence by the chief executive.
The president tried to oust Lisa Cook, alleging she committed mortgage fraud, and the Justice Department separately launched — and later dropped — a probe into whether then-Federal Reserve Chair Jerome H. Powell gave misleading statements to Congress. Both deny any wrongdoing and accused Trump of seeking to wrest control of the central bank to carry out his policy goals.
A group of justices from across the court’s ideological spectrum ruled Cook could keep her job while a lawsuit challenging her dismissal plays out in the courts. The case could take months or years to resolve and could eventually appear before the high court again on appeal.
Trump is the first president in the Fed’s 112-year history to try to fire one of its board members. In August, Trump alleged that Cook claimed two homes as primary residences to get a better mortgage rate. In filings with the Supreme Court, Cook “unequivocally” denies the allegations, and some documents list one of the properties as a “vacation home.”
Cook, who was initially appointed to the Fed board by President Joe Biden in 2022 and renominated to a 14-year term in 2023, is the first Black woman to hold the position.
The high court case revolved around whether Trump’s attempt to fire Cook complied with the Federal Reserve Act, which says Fed board members can only be ousted “for cause.”
Days after Trump announced on social media in August that he was firing Cook, she sued in federal court. Her suit argues that Trump’s accusations did not meet the standard for “for cause” removal because the allegations occurred before she was on the Fed board and had not been proved. Her attorneys also said she had not been given due process to defend herself.
During arguments in January, Solicitor General D. John Sauer told the justices that the mortgage allegations gave Trump reason enough to fire Cook and that the courts did not have the authority to second-guess his determination.
“The American people should not have their interest rates determined by someone who was, at best, grossly negligent in obtaining favorable interest rates for herself,” Sauer said.
Paul D. Clement, an attorney for Cook, said the justices would be rash to rule on the Trump administration’s emergency request to oust Cook from her job without the benefit of additional fact-finding and legal proceedings.
“There is no reason to abandon more than 100 years of central bank independence on an emergency application,” Clement said.
Eight of the nine justices asked probing questions of Sauer’s arguments. Conservative Justice Brett M. Kavanaugh was particularly pointed, telling Sauer his positions in the case “would weaken if not shatter the independence of the Federal Reserve.”
Kavanaugh said presidents could concoct reasons to fire Fed governors with dangerous implications for the central bank. “What are we doing when we have a system that incentivizes that?” Kavanaugh asked.
The justices are also ruled Monday on another closely related case this term. The court decided to overturn a nearly century-old precedent that allows Congress to limit the ability of the president to fire the heads of independent agencies. Such a ruling ushered in one of the largest changes to the structure of government in decades.
Trump on Truth Social
Truth Social: To show the importance of the Slaughter Case, 90 years of precedent has been COMPLETELY AND UNEQUIVOCALLY OVERRULED, greatly increasing Presidential Power at a time when it is most needed! President DONALD J. TRUMP
Jun 29, 2026, 9:24 AM
That is more than a bit weird because Trump lost the case. So what is this nonsense “greatly increasing Presidential Power at a time when it is most needed! ”
Trump Will Try Again
Truth Social: The Cook Lawsuit, having to do with her suitability in sitting on the Board of the Federal Reserve, was sent back by the Supreme Court on a strictly procedural basis, we will take appropriate action immediately to make sure that someone who has committed wrongdoing will not be making vital decisions concerning the Welfare of the United States of America! Thank you for your attention to this matter. President DONALD J. TRUMP
Jun 29, 2026, 9:23 AM
Great. Trump will try again and lose again, making an ass of himself again.
The Case
Please consider TRUMP, PRESIDENT OF THE UNITED STATES v. COOK, MEMBER OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, ET AL.
(3) The Court rejects the Government’s contention that federal courts cannot grant a preliminary injunction ordering reinstatement during the pendency of litigation. Historically, a court of equity could not finally determine whether a plaintiff was validly removed—that was a question only a court of law could settle by quo warranto or mandamus. In the meantime, however, equity could ensure that “the actual incumbents of an office may be protected, pending a contest as to their title, from interference with their possession, and with the exercise of their functions,” at least to the extent that they had a likely meritorious claim. 2 J. High, Law of Injunctions §1315, p. 866. The District Court sought to do just that here. Pp. 15–16.
(b) The Court decides this application on the narrow ground that the President failed to afford Cook the procedural protections to which she was entitled by statute. Without such protections, she could not properly dispute the charges the President laid against her. The Court need not address Cook’s constitutional due process argument, for the statute alone makes it unlikely that the Government will prevail on appeal as to the validity of the procedures used to fire Cook. Pp. 17– 27.
(1) Under the Court’s precedents, Cook was entitled to notice and some opportunity to respond before her termination. When Congress created the Federal Reserve, it gave Governors a set term in office and permitted removal only “for cause.” That form of tenure—a term of years limited only by removal “for cause”—carried with it a settled interpretation at common law, one that the Court had expressly adopted just a decade before. “[T]he rule,” the Court explained in 1901, is that “notice and hearing are essential” before an officer’s removal “where the term of office is for a fixed period.” Reagan v. United States, 182 U. S. 419, 425; see also Shurtleff v. United States, 189 U. S. 311, 314. Reagan and Shurtleff established the baseline against which Congress legislated, and the Court must construe its work accordingly. That is not to say that a Federal Reserve Governor is entitled to a full-blown judicial trial. All that is required is “the right to support his allegations by argument however brief, and, if need be, by proof, however informal,” before a final decision is made. Londoner v. City and County of Denver, 210 U. S. 373, 386. Pp. 18–21.
(2) The protection from removal enjoyed by Governors of the Federal Reserve is consistent with the Constitution. The Founders knew from experience the calamities that could arise from even the “suspicion” of political manipulation of monetary policy. Report on a National Bank (Dec. 13, 1790), in 7 Papers of Alexander Hamilton 305, 331. So when they established the First Bank of the United States, they guaranteed its independence from Presidential control, and their successors did the same for the Second Bank. That enabled both banks to serve as the “great regulating wheel” of the early American financial system. E. Lomazoff, Reconstructing the National Bank Controversy 53.
The Federal Reserve follows in this tradition, with a similar degree of independence from Presidential control. What matters is that the Federal Reserve remains consistent with the principles that underpin the First and Second Banks—namely, that monetary policy should not be subject to political interference. In the Court’s view, the Federal Reserve maintains the balance struck by the founding generation under modern circumstances.
Although this extraordinary case arises on the Court’s interim docket, the Court has had the benefit of not only amici and oral argument but months of internal consultation and deliberation. The Court declines to sow doubt as to the status of one of the Nation’s (and the world’s) most important financial institutions, and would not so quickly unsettle this “special arrangement sanctioned by history.” Consumer Financial Protection Bureau v. Community Financial Services Assn. of America, Ltd., 601 U. S. 416, 467, n. 16 (ALITO, J., dissenting). Pp. 22–24.
(3) The Court rejects the Government’s halfhearted contention that Cook in fact received due process. At minimum, Cook was entitled to some explanation of the evidence at issue, some avenue for a response, and a deadline by which a response would be due. Cf. Mullane v. Central Hanover Bank & Trust Co., 339 U. S. 306, 314–315. Only after Cook has had the opportunity to respond to the charges made against her may a final decision be made. And only then can the courts assess the validity and sufficiency of such charges. Pp. 24–27.
Syllabus Five to Four
ROBERTS, C. J., delivered the opinion of the Court, in which SOTOMAYOR, KAGAN, KAVANAUGH, and JACKSON, JJ., joined. KAVANAUGH and JACKSON, JJ., filed concurring opinions. THOMAS, J., filed a dissenting opinion. ALITO, J., filed a dissenting opinion, in which GORSUCH, J., joined. BARRETT, J., filed a dissenting opinion.
Appearance of independence is key to the Federal Reserve’s design.
That counsels a substantial threshold for “cause.” Whether “cause” for removal exists in any given situation will depend, at least in part, on the seriousness of the alleged misconduct, and the extent of any nexus that may exist to the Governor’s professional duties. The key issue is whether “[t]he cause assigned” truly “impl[ies] an unfitness for the place”—or whether it simply represents an effort to secure a “more congenial” replacement. In re Nichols, 6 Abb. N. Cas. 474, 482. Without such constraints in place, any perceived or alleged misstep (past or present) could provide a ready pretext for a Governor’s removal—a fact that he would surely know, and that would surely weigh on him as he decided what to say and how to vote.
Nothing could be more corrosive of the independence that Congress sought to preserve. Pp. 11–15. (3) The Court rejects the Government’s contention that federal courts cannot grant a preliminary injunction ordering reinstatement during the pendency of litigation. Historically, a court of equity could not finally determine whether a plaintiff was validly removed—that was a question only a court of law could settle by quo warranto or mandamus. In the meantime, however, equity could ensure that “the actual incumbents of an office may be protected, pending a contest as to their title, from interference with their possession, and with the exercise of their functions,” at least to the extent that they had a likely meritorious claim. 2 J. High, Law of Injunctions §1315, p. 866. The District Court sought to do just that here. Pp. 15–16.
(b) The Court decides this application on the narrow ground that the President failed to afford Cook the procedural protections to which she was entitled by statute. Without such protections, she could not properly dispute the charges the President laid against her.
The Court need not address Cook’s constitutional due process argument, for the statute alone makes it unlikely that the Government will prevail on appeal as to the validity of the procedures used to fire Cook. Pp. 17– 27.
(1) Under the Court’s precedents, Cook was entitled to notice and some opportunity to respond before her termination. When Congress created the Federal Reserve, it gave Governors a set term in office and permitted removal only “for cause.” That form of tenure—a term of years limited only by removal “for cause”—carried with it a settled interpretation at common law, one that the Court had expressly adopted just a decade before. “[T]he rule,” the Court explained in 1901, is that “notice and hearing are essential” before an officer’s removal “where the term of office is for a fixed period.” Reagan v. United States, 182 U. S. 419, 425; see also Shurtleff v. United States, 189 U. S. 311, 314. Reagan and Shurtleff established the baseline against which Congress legislated, and the Court must construe its work accordingly.
Kavanaugh Sides With the Majority
Chief Justice Roberts wrote the opinion. Kavanaugh provided the fifth vote.
JUSTICE KAVANAUGH, concurring. I join the Court’s opinion in full and write separately to emphasize two points. First, today’s interim ruling does not decide whether the President may lawfully remove Governor Cook for cause.
The ultimate decision about whether the President may remove Governor Cook for cause will largely depend on the facts regarding the Governor’s actions. And those facts have yet to be determined.
The Court’s opinion today simply settles some of the legal and procedural ground rules under which (i) the Executive Branch may determine and assess the facts and (ii) courts may then “assess the validity and sufficiency” of any asserted grounds for removal. Ante, at 25.
Second, in establishing some of those legal and procedural ground rules, the Court confirms the longstanding historical practice and understanding that the Federal Reserve is an independent agency whose Governors enjoy for-cause removal protection consistent with Article II of the Constitution.
The Government itself expressly “acknowledge[d]” and did “not disput[e]” that point in this case, even as the Government simultaneously (and successfully) argued that the for-cause removal protections for most independent agencies violate Article II.
I agree with the Court, moreover, that we should not leave open the question whether the Federal Reserve can remain an independent agency in the wake of Slaughter. After Slaughter, there is a clear choice: Either the Federal Reserve may remain independent (with the Governors removable for cause, not at will), or it may not.
Leaving that question open would create significant uncertainty about whether the Court might soon eliminate the Federal Reserve’s independence, and thereby expose the Federal Reserve to political influences and jeopardize the efficacy of U. S. monetary policy.
Even temporary uncertainty about the status of the Federal Reserve could spark political upheaval, including confusion about whether the President could immediately remove multiple Governors at will, as well as turmoil in the U. S. and world economies. I would not go down that road. I would not risk destabilizing the U. S. economy just so that we can further mull over an issue that, in various permutations, we have been thinking about for many years.
As the Court’s opinion explains and the Government agrees, the Federal Reserve occupies a unique role in the U. S. Government and maintains critical responsibility for the stability and success of the U. S. and world economies.
Trump’s Attempts to Pack the Fed Failed
The dissents were Alito, Thomas, Gorsuch, and Barrett.
There was no cause to fire Lisa Cook. The charges were ridiculous.
Trump himself is guilty of the behavior he accused Lisa Cook of. Cook at least has a believable excuse as to what happened.
Trump accuses democrats of wanting to pack the courts as he does himself. In this case Trump tried to pack the Fed and failed.
I Told You So
Flashback January 22, 2026: The Supreme Court, Even Kavanaugh, Ready to Strike Trump’s Move on Lisa Cook
The DOJ was amusingly feeble in the SC regarding the Fed’s Lisa Cook.
JUSTICE KAVANAUGH: Let’s talk about the real-world downstream effects of this because, if this were set as a precedent, it seems to me, just thinking big picture, what goes around comes around. All of the current president’s appointees would likely be removed for cause on January 20th, 2029, if there’s a Democratic President or January 20th, 2033, and then we’re really at at-will removal. So what are we doing here?
GENERAL SAUER: Yeah.JUSTICE KAVANAUGH: What is — you know, we started — that’s why I started with what’s the purpose of the independence in the for-cause removal. If we accept all these no procedure, no judicial review, no remedy, you know, that’s what’s going to happen, I think, and then — then where are we? So do you dispute that that is, you know, the — the real-world effect?
GENERAL SAUER: I cannot predict what future presidents may or may not do, but the argument strikes me as a policy argument —JUSTICE KAVANAUGH: Well, history is a pretty good guide. Once these tools are unleashed, they are used by both sides and usually more the second time around. We have to be aware of what we’re doing and the consequences of your position for the structure of the government.
I thought that would be a bit stronger than 5-4 against Trump given that Kavanaugh was clear.
I had this as 6-3 with Kavanaugh in the majority.
Related Posts
February 20, 2026: Supreme Court Strikes Trump’s Reciprocal Tariffs In 6-3 Vote (I Told You So)
Forgive me for bragging, but I got every justice correct.
May 7, 2026: Trade Court Sends Trump’s Section 122 Tariffs Down the Drain
Gee, I get another Tariff “I Told You So.”
Fearless Predictions, Ten Key Events to Expect in 2026
On January 1, 2026, I made Fearless Predictions, Ten Key Events to Expect in 2026
#1: Trump will Lose His Supreme Court Battle on Reciprocal Tariffs
Expect a 6-3 margin against Trump, possibly 7-2. I rate this a 75 percent chance.
#2: Trump will Lose His Supreme Court Battle on Birthright Citizenship
Expect a 7-2 vote against Trump. 9-0 would not be a surprise.
I rate this a 90 percent chance.
#3: Trump will lose his Supreme Court battle over the right to fire Fed governor Lisa Cook.
Expect a 6-3 vote against Trump. I rate this a 80 percent chance.
The big one, Birthright Citizenship is coming up.
Trump will get smacked exceptionally hard. 9-0 would not surprise me but my official call was 7-2.
No, I am not tired of winning.
Mish–thanks for your great analysis of the Supreme Court justices’ role in this decision. I saw the Supreme Court several times in the 80’s when I was in law School. Once had a 15 minute conversation with Rehnquist outside the court when he was taking a walk around the building when the Court was out of session. Delightful and pleasant man when he was not interrogating lawyers during oral arguments. I used to be able to try to reasonably predict each Justices’ role in cases until maybe 6 years ago when the Covid/vaccine crisis and Russia/Ukraine war (and now Iran war) got me sidetracked on other issues than the Supreme Court. Seems my primary source on Supreme Court Rulings seems to now be you. Thanks for your insight and analysis. Very impressive.
Thanks. Looks like the Court is holding Birthright Citizenship to the end.
Holding at 7-2 minimum against Trump.
5-4 in the Lisa cook decision is surprisingly close. Bet Trump is crying over picking Kavanaugh and Barrett, look to him nominating Judge Aileen Cannon the next time there is a vacancy.
Markets rally in relief.
But the other SCOTUS ruling, allowing many other administrative firings, is worthy of sharp attention and concern too — if for no other reason than inviting patronage firings and hirings en masse when the other party takes over. Some will applaud the introduction of instability (and more party hacks) into the administrative state. This takes us back to pre-Teddy Roosevelt days. I’m not so sure.
this is actually a very narrow decision, and not a very positive one.
. it still leaves the door open because the court said it wasn’t deciding what the standad is for firing a fed governor for cause because none of those facts were before them, but they certainly did not rule that under no circumstances court POTUS fire a fed governor.
this is bad for Governor Cook because this will simply encourage Trump to launch more witch hunts, to drum up cause and to otherwise make her life miserable. I supoe it cold still be good because SCOTUS clearly wants some procedural steps and evidence about cause but given the ideology of the court who knows how meaningful it will require those to be.
In retrospect – the correct ruling.
Trump has a right to remove Cook for cause.
The court cannot rule on cause because there was no cause, because there was no hearing.
I am confident Cook can win that case, if nothing else on appeal.
If she wins on Appeal, the SC won’t even take the case.
SCOTUS just now declined to review Trump’s $5m sexual assault damages case.
Given that rates are going to rise because of runaway inflation its pointless for Trump to continue against Cook because they are all going to vote for a rate increase.
Ability of Trump to dismiss Fed governors at will would have nevertheless been a massively wrenching situation, destabilizing world finance..
The gloating regarding the Supreme Court checking Executive power is premature. What the Court did was to carve out an exception for the Fed, while overruling a 90 year precedent; now allowing the President apparently unfettered authority to fire any other Executive Branch Agency head or employee without cause.
In essence, it allows any President the authority to fire any, and perhaps all, employees of any federal agency, and replace them or not, at his discretion. This is similar to what Musk did at IRS, Kennedy is doing at HHS, and Pulte, acting DNI, is beginning at CIA and other intelligence agencies.
This will be extremely dangerous as non-political experts are replaced with ideological zealots across the government.
This is Banana Republic territory, which combined with its laissez faire attitude to political corruption, is apparently exactly what the Robert’s Court is seeking.
Bob, with all due respect, non-political experts are responsible for as much, if not more damage – Consider one “lifer” – Dr. Fauci. If the Constitution vests executive power in the executive, then for better or worse that’s where it should be. Not that we’re always HAPPY with the results. Also, constitutional doesn’t men GOOD. .
What about Dr. Fauchi exactly? Seeing as he did literally nothing as shown by the files that Trump’s own DNI dropped for some reason.
The gaping change in the system this SCOTUS holding brings, will be beyond obvious in the upcoming mass firings. One anecdotal example of a guy you don’t like, hardly addresses this systemic shift. There will be a flood of loyalist hacks into the system, who are as ignorant of their subject natter as Trump himself. You’ll see!
Consider the damage Kennedy has done, then whine about Fauci.
Great call.
I’m a bit surprised at only 5-4 but if anyone believes that the SCOTUS is non partisan and rules only on the law, this should disabuse them of that notion.
The founding fathers could not have possibly foreseen the Motor Home, and it’s pernicious effect upon the judicial system.
Agreed. There is so much wrong with SCOTUS being political appointees. And this case highlights it very well.
Even if the judgement of the law of the case WAS continuous then you shouldn’t expect a partisan split and this is not obviously a partisan issue under law.
I wonder how the rulings would have gone had Biden tried to fire a white male republican appointee to the Fed?
Trump has made the same false claim on two separate properties in Florida according to realtors. In Cooks case, she corrected the error, in Trumps case he did not.
If Cook is nor fit for office under this standard, Trump should recuse himself from office immediately.
Where is Pultie on Trumps falsification of mortgage applications?
JoJo, can you explain why Trump is above his own standard on this?
Pultie has his nose deep, deep in a place that not even hobbits will go. He is now an extension of the Presidential Posterior, and does only its bidding.
Since when has Trump followed the same standards he imposes on others? He is immune from prosecution (thanks SCOTUS!), but his politicized DOJ pursues former underlings on sketchy grounds, who have not kowtowed to him. He uses free speech but his FCC is attacking the licensing of other sources.
Trump is an ogre and a clown. I’ve never voted for him and never would.
But this: “The executive Power shall be vested in a President of the United States of America,” either means what it says or the entire constitution ought to get thrown out.
Something I’d be fine with.
The Fed is an extra-constitutional, expansion of government power and it has achieved next to nothing.
The inflation rate in the 100 years (or so) since its founding is actually higher than the rate for the one hundred years prior. The frequency of recessions has been about the same and, of course, the Great Depression occurred on the Fed’s watch.
The idea that the Fed stabilizes the economy is nonsense. What it does is print money, the drunken perverts we elect to rule us can transfer to their rent seeking cronies.
Interest rates can and should be set by the marketplace for money.
But there’s no grift in that.
“The inflation rate in the 100 years (or so) since its founding is actually higher than the rate for the one hundred years prior.”
Partially true. The AVERAGE inflation rate was lower in the preceding 100 years. But the highs and lows were staggeringly higher and lower. With little regulation, banks produced massively more bank notes than gold and silver could back up causing massive inflation, then when folks went to trade those notes back to the bank, the banks would collapse causing massive deflation. It was a great system for financiers who could issue notes and steal the gold, but for businessmen and workers trying to invest in the future it was a repeated disaster.
After the Panic of 1913, actual productive business owners had had enough, and demanded the creation of the federal reserve to get control of the banks and money creation. This, of course, lead to the greatest era of wealth creation in the history of the world.
congress sets the budget and collects taxes seems to me that is the root of the problem. Imo.
Also Nixon closed the gold window.
Trump only “packed the court” with conservative judges who interpret the law as it is written not like the liberal judges who want to interpret the law as they would like it to be. Big difference. Thats why they ruled against Obama with the campaign donation legal bribing issue. The law needed to be changed by congress, its not the courts job to do that. So far Warsh and the supreme court appointments are one of the few things he has done right. I don’t understand why this vote was 5/4 should have been unanimous
what review was Lisa Cook given?
What cause?
What does the law saw about a review?
Of course I expected Alito and Thomas to dissent because they are a Trump rubber stamp. On the other side there are 3 Liberal rubber stamps.
right, when Trump does it it’ not political but with Dems it is. Hard to imagine anyone can actually believe this.
Trump’s Annus Horribilis!
Told you …. https://www.bbc.com/news/articles/cn8q2z5wpn2o
Glad some of the tyrant’s ill-conceived actions are being reigned in. However, others will probably pass unabated.