A federal judge on Tuesday delivered a sharp rebuke to President Donald Trump’s attempt to remove Federal Reserve Governor Lisa Cook, ruling that the president lacked authority to oust her without clear evidence of misconduct.
Judge Jia Cobb, a Biden appointee on the federal bench in Washington, granted Cook’s request for a preliminary injunction, effectively freezing Trump’s move and keeping her in office while the case proceeds. “President Trump has not identified anything related to Cook’s conduct or job performance … that would indicate that she is harming the Board or the public interest,” Cobb wrote in her opinion.
The ruling marks the first time a president has tried to fire a sitting Fed governor, a position traditionally shielded from political pressure. Trump justified the dismissal by citing allegations of mortgage fraud, which remain under Justice Department investigation. But Cobb rejected the argument, stressing that “for cause” removal applies only to actions that compromise a governor’s ability to perform duties while in office.
The dispute comes on the heels of a Supreme Court decision earlier this year that narrowed a president’s power to remove independent financial regulators. Cook’s lawyers argue Trump is attempting to stretch the definition of “cause” so far that it would allow him to purge officials over policy disagreements. “President Trump does not have the power to unilaterally redefine ‘cause’ … and conclude, without evidence, that he has found it,” her attorneys wrote.
Cobb sided with that reasoning, warning that the administration’s theory would hollow out the Fed’s statutory independence. “Such a rule would provide no practical insulation for the members of the Board of Governors,” she wrote. “It would mean the President could, in practice, remove a member merely because he wanted his own appointees.”
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The injunction does not end the case, but it signals that the court views Cook’s challenge as legally weighty. “President Trump’s actions and Cook’s resulting legal challenge raise many serious questions of first impression,” Cobb noted, suggesting the broader constitutional issues will unfold over months of litigation.
For now, Cook will remain on the Board. Her attorney, Abbe Lowell, hailed the decision as a safeguard for central bank independence. “Allowing the President to unlawfully remove Governor Cook … would endanger the stability of our financial system and undermine the rule of law,” he said.
The clash underscores the fragile boundary between politics and monetary policy — and how this presidency is testing it.