In a 2-1 decision, the US Court of Appeals for the District of Columbia on Monday denied US President Donald Trump’s motion to pause a lower court’s preliminary injunction prohibiting him from firing Federal Reserve Governor Lisa Cook.
The two judges in the majority, both Biden appointees, found Cook was likely to succeed on a due process challenge to her removal. The Federal Reserve Act only allows for the removal of a governor “for cause.” Without addressing whether Trump had cause to fire Cook, the majority of the court asserted that this “for cause” requirement vests Cook with a property interest in her position. Before depriving an individual of their property, the Due Process Clause of the Constitution requires the government to provide individuals notice and an opportunity to be heard. Trump did not provide either to Cook, making the removal unlawful, according to the court.
Trump removed Cook from her position in late August, alleging she made false statements on personal mortgage applications before joining the Board of Governors. In an emergency motion to pause the lower court’s injunction, Trump attorneys argued that Cook has no property right and that a hearing providing Cook an opportunity to be heard is only necessary when there are disputed facts. They contend that Cook has not contested factual allegations against her, negating the need for a hearing. Judge George Katsas, a Trump appointee, dissented from the order, agreeing with the administration that public officials like Cook have no property interest in their positions.
The ruling clears the way for Cook to join the Board of Governors meeting on Tuesday unless the administration secures a timely appeal to the Supreme Court. The case comes against a backdrop of other challenges to Trump’s authority to remove administrative agency heads throughout his second term.