A federal judge in Washington heard arguments Friday in a closely watched legal battle over President Donald Trump’s attempt to fire Federal Reserve Governor Lisa Cook — the first such case in the central bank’s 110-year history. The judge issued no immediate ruling.
Cook is seeking to block her removal and confirm her status as a member of the Fed’s governing board. Trump has accused her, without offering evidence, of committing mortgage fraud. She has never been charged with a crime. Her lawsuit argues that the allegations are a pretext for removing her because she has resisted Trump’s push to lower interest rates.
Attorneys for Cook, led by Abbe Lowell, argued the president failed to provide proper legal notice, saying she learned of the attempt via social media posts rather than an official letter. They also contend that “cause” — the legal threshold required to remove a Fed governor — has not been met.
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Justice Department lawyers countered that social media postings from the president constituted proper notice and that Cook had sufficient time to respond. They also claimed Trump’s decision is not reviewable by the courts, insisting the president has broad authority to remove Fed officials.
The hearing highlighted a central question: Does the president have unfettered discretion to decide what constitutes “cause” to fire a Federal Reserve governor, or are there legal limits to protect the central bank’s independence? Lowell suggested even trivial reasons — such as disliking someone’s attire — could be offered as a valid cause.
The case could set a major precedent for the political independence of the Fed and is widely expected to reach the U.S. Supreme Court. Past high court opinions have suggested the Federal Reserve might be among the few agencies shielded from presidential removal, though the question has never been tested.
Additional legal filings are expected next week, and the judge hinted she hopes to issue a decision within two weeks. Until then, Cook’s job status at the Fed remains uncertain.
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