The Supreme Court on Wednesday deferred action on whether President Donald Trump can immediately fire Federal Reserve board member Lisa Cook, instead agreeing to hear oral arguments in the case early next year.
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The move means that Cook can remain in office while the consequential legal question is decided. The court will hear oral arguments in January, the brief order said, with a ruling likely before the end of June.
Trump had asked the court to allow him to immediately fire Cook while litigation continued in lower courts. The court’s move indicates that there was not a majority to grant that request, at least for now.
Under the Federal Reserve Act, presidents are restricted from removing governors unless it is “for cause,” meaning there is evidence of wrongdoing.
Trump has said he fired Cook for cause, over allegations of mortgage fraud made by one of his political appointees, Federal Housing Finance Agency Director Bill Pulte. Cook has denied the allegations, and bank documents obtained by NBC News appear to contradict the fraud claim.
Since taking office in January, Trump has pushed for lower interest rates and had criticized the Fed for failing to act on his wishes.
In a statement after Wednesday’s news, the White House maintained that Trump “lawfully removed Lisa Cook for cause,” and said, “We look forward to ultimate victory after presenting our oral arguments before the Supreme Court in January.”
Cook’s lawyers, Abbe Lowell and Norm Eisen, said in a statement that Wednesday’s “decision rightly allows Governor Cook to continue in her role on the Federal Reserve Board, and we look forward to further proceedings consistent with the Court’s order.”
While the president’s aggressive use of executive power has often led to setbacks in lower courts, the Supreme Court has regularly granted the administration’s emergency requests that allow his policies to move forward.
In seeking to put his stamp on the Federal Reserve, Trump has already appointed one of his advisers, Stephen Miran, to serve as a Fed governor. Next year, he will be able to appoint a new chair when Jerome Powell’s term in that role expires.
On Sept. 17, the Fed announced its first rate cut of the year, which Cook voted for.
Trump moved to fire Cook in late August, prompting her to file a federal lawsuit. Cook had argued that Trump did not have the authority to remove her from office while she challenged his decision in court. Lower courts ruled in her favor, leading to Trump rushing to the Supreme Court.
The Trump administration has also sought to exert greater power over other hitherto independent federal agencies by firing various officials.
The Supreme Court has allowed such moves and taken up a case on the issue that will be argued in December.
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