Supreme Court blocks Trump's firing of Lisa Cook

(The Center Square) - The U.S. Supreme Court, in a 5-4 decision on Monday, prevented President Donald Trump from firing Lisa Cook, a member of the Federal Reserve's Board of Governors.

Trump accused Cook of committing mortgage fraud before she joined the Federal Reserve. He said Cook listed homes in both Michigan and Georgia as her "primary residence" for the next year.

"At a minimum, the conduct at issue exhibits the sort of gross negligence in financial transactions that calls into question your competence and trustworthiness as a financial regulator," Trump wrote in a letter to Cook in August 2025.

According to the Federal Reserve Act, members of the board of governors can only be fired by the president "for cause."

A lower court judge prevented Trump from firing Cook. The judge said Cook was entitled to notice and a hearing before being fired and that she needed to be fired for something that happened while she was in office.

Justices on the high court agreed. Chief Justice John Roberts said Trump's attempt to fire Cook would go against legal statutes designed to protect independence of the Federal Reserve.

"Acceptance of the Government's position would in effect transform the Federal Reserve's for-cause protection into at-will employment – an interpretive leap out of step with the statute Congress enacted and our Nation's tradition of central banking protected from political interference" Roberts wrote.

The case represented a crucial test of the president's relationship with members of the Federal Reserve. Trump repeatedly criticized Jerome Powell, former chair of the Federal Reserve, for not lowering interest rates.

Roberts pointed to the Federal Reserve's longstanding history in the United States. He said the central bank has acted since before the U.S. Constitution and was used to help fund the American Revolutionary War.

Justices Clarence Thomas, Samuel Alito, Amy Coney Barrett and Neil Gorsuch dissented the court's majority opinion. Thomas said Trump has the authority under Article II of the Constitution to fire Cook for cause.

'[Trump] did so pursuant to his authority to remove principal executive officers under Article II of the Constitution and a statute that expressly authorizes him to remove officers on the Board for 'cause,'" Thomas wrote.

Roberts argued that the cause Trump employed was not sufficient and courts should be allowed to review firing decisions made on executive boards.

"As the Government eventually acknowledges, it falls to the courts to 'discern the boundaries of the President's power' under the Federal Reserve Act," Roberts wrote.

Kevin Warsh, Trump's new pick to lead the central bank, has committed to changing several metrics of which the central bank will use to determine future monetary policy. Lisa Cook is set to remain in her position until the end of her term in 2038.