The U.S. Supreme Court on Wednesday temporarily allowed Lisa Cook to continue serving as a Federal Reserve governor, declining to grant the Trump administration’s request for her immediate removal from the central bank.
In a short, unsigned order, the justices said they would take up the case in January, when arguments will be heard on whether Republican President Donald Trump has the legal authority to oust Cook before her term ends. Until then, Cook will remain in her post while the legal challenge continues.
The ruling marks a rare instance where Trump did not get an immediate victory from the high court in an emergency appeal — a break from the pattern of swift approvals he’s often received from the conservative majority.
A Broader Legal Battle Over Executive Power
This case is part of a wider constitutional dispute surrounding the president’s authority to fire members of independent federal agencies. The justices are already scheduled to hear a related case in December involving Trump’s removal of other board members overseeing similar regulatory bodies.
A second issue in that case could have major implications for Cook’s situation: whether federal courts can block a dismissal in real time, or if they can only award back pay after the fact for officials found to have been unlawfully removed.
Trump’s Attempt to Remove Cook
The Trump administration moved to fire Lisa Cook just before the Federal Open Market Committee’s September meeting, where policymakers decided to lower the benchmark interest rate by a quarter of a percentage point.
However, a U.S. District Court judge blocked the move, ruling that Cook’s firing violated statutory protections. A divided appeals court later upheld that decision, rejecting the administration’s emergency request to move forward.
Undeterred, the White House filed an emergency appeal to the Supreme Court the day after the rate decision, seeking immediate intervention.
If successful, Trump’s move would mark an unprecedented break from a 112-year tradition of Federal Reserve independence. No sitting president has ever dismissed a Fed governor, whose terms are designed to be insulated from political influence.
Cook Pushes Back: “I Will Not Be Bullied”
Appointed by President Joe Biden, Cook has vowed to remain in her position, telling reporters she will not be “bullied” into leaving.
Her attorney, Abbe Lowell, said Cook “will continue to carry out her sworn duties as a Senate-confirmed Board Governor.”
Meanwhile, Senate Republicans recently confirmed Stephen Miran, Trump’s nominee to fill another vacant seat on the Fed’s board. Both Cook and Miran participated in the most recent policy meeting — though Miran dissented, calling for a larger rate cut.
Cook’s next opportunity to cast a vote will come at the October 28–29 meeting of the Fed’s interest rate-setting committee.
The Mortgage Fraud Allegation
Trump has accused Cook of mortgage fraud, alleging that she improperly listed two homes — one in Michigan and another in Georgia — as “primary residences” in mid-2021, a designation that typically qualifies borrowers for lower interest rates and smaller down payments.
“Put simply,” Solicitor General D. John Sauer argued in the administration’s filing, “the President may reasonably determine that interest rates paid by the American people should not be set by a Governor who appears to have lied about facts material to the interest rates she secured for herself — and refuses to explain the apparent misrepresentations.”
Cook, however, denies any wrongdoing and has not been charged with any crime. Documents reviewed by the Associated Press appear to undermine the accusation: in a May 2021 loan estimate, Cook listed her Atlanta condo as a “vacation home,” and in a security clearance form, she described it as a “second home.” Both filings contradict claims that she misrepresented her residency status.
The Court’s Reasoning and Legal Implications
U.S. District Judge Jia Cobb ruled that the Trump administration failed to meet the legal requirement that Fed governors can only be removed “for cause.” She defined that standard as applying solely to misconduct committed while in office, not prior to appointment.
Cobb further found that an immediate dismissal would violate Cook’s due process rights, depriving her of the opportunity to contest the charges.
The federal appeals court in Washington upheld that decision by a 2–1 vote, forcing Trump’s legal team to take the matter to the Supreme Court.
Even if Cook’s alleged conduct occurred before joining the Fed, Trump’s attorneys maintain it “calls into question her trustworthiness” and her ability to act as “a responsible steward of interest rates and the broader economy.”
What Happens Next
The Supreme Court’s January hearing will be closely watched by economists, lawmakers, and legal experts, as it could reshape presidential authority over independent agencies like the Federal Reserve.
Until then, Lisa Cook will continue her work on the board — a temporary victory that underscores both the Fed’s institutional independence and the ongoing political battle over who controls it.
If the Court sides with Trump next year, it could open the door for future presidents to directly influence monetary policy by removing governors at will — a move that would dramatically alter the balance between politics and economic decision-making in Washington.