Supreme Court to Review Trump’s Firing of Fed Governor

Trump has underscored the nature of his authority under Article II of the Constitution, which vests the federal government’s executive power in the president.

The U.S. Supreme Court building in Washington on Jan. 12, 2026. Madalina Kilroy/The Epoch Times

Another one of President Donald Trump’s high-profile firings is headed to the Supreme Court on Jan. 21, when the justices are expected to review how much Congress can protect members of the Federal Reserve from removal.

Trump fired Federal Reserve Board of Governors member Lisa Cook in August 2025 over allegations of mortgage fraud. In a letter to Cook, Trump cited a provision of the Federal Reserve Act of 1913 that allows him to fire members “for cause.”

After a lower court reinstated Cook, Trump asked the Supreme Court to intervene. In the upcoming oral arguments, the justices are expected to probe multiple legal issues, including whether the mortgage allegations were the type of cause that allows firings under the Federal Reserve Act.

Here is an overview of the case, known as Trump v. Cook, and the main legal arguments involved.

Mortgage Fraud Allegations

On Aug. 15, the Federal Housing Finance Agency issued a criminal referral suggesting that Cook made false statements on one of her mortgage agreements—specifically misrepresenting one of her properties as her primary residence.

Ten days later, Trump sent a letter to Cook informing her of her termination. “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,” he said.

After Cook sued, a federal judge in Washington reinstated her. In a more tentative order, the judge said that Trump probably didn’t have a valid cause for firing Cook.

Under this judge’s interpretation, for Trump to fire Cook, he would have to do so for a reason related to an unfaithful execution of her statutory duties while she was in office. Cook’s alleged fraud took place before she began serving at the Federal Reserve.

Trump has asked the Supreme Court to lift this block while litigation continues in lower courts. Typically, these types of appeals, which come on the emergency docket, are decided without oral argument. In this case, however, the Supreme Court deferred its decision until it heard arguments.

The Justice Department told the Supreme Court in September 2025 that not only was Trump’s cause sufficient, but that courts didn’t have the authority to review his determination of that cause.

Reinstating Officials

Separate from Congress’s phrasing, the power of judges to reinstate fired officials is also under scrutiny in both Cook’s case and another case that was heard in December 2025.

For months, lower court judges have been reversing Trump’s firings of high-level bureaucrats. In response, the Trump administration argued that doing so was overstepping judicial authority and that the more appropriate remedy to illegal firings was back pay.

The Supreme Court is expected to address that issue in Trump v. Slaughter, which focused on the president’s ability to fire members of the Federal Trade Commission.

It’s unclear how they will rule, and they didn’t focus much on the issue during oral argument on Dec. 8, 2025. But in its emergency docket decisions, the Supreme Court has indicated some sympathy for Trump’s position.

Cook’s case is unique for multiple reasons, including that it raises questions about whether officials have a constitutional right to their positions in the federal government. In a briefing to the Supreme Court, Cook cited the Fifth Amendment, which says the government cannot take away someone’s property without due process.

The lower court in Washington said that Cook had a property interest in her position and that Trump failed to provide the necessary due process before removing her. Specifically, the judge said that Trump needed to provide some kind of notice and hearing for Cook.

In response, the Justice Department noted that Trump waited five days before dismissing her after notifying her of the charges. Solicitor General D. John Sauer also denied that offices like Cook’s were property and that requiring a notice and hearing would “wreak havoc on sensitive presidential decision-making.”

Federal Reserve Independence

What also makes Cook’s case unique, and what may give her an edge over other federal officials, is how the Supreme Court views the Federal Reserve’s independence.

Last year, a majority of the justices temporarily allowed Trump to remove the heads of two labor boards who had tried to compare their agencies to the Federal Reserve. Allowing Trump’s firings, which overrode similar laws restricting removals, would effectively call into question the independence of the Federal Reserve.

A majority of the justices rejected this comparison, stating that the “Federal Reserve is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States.”

Cook has referenced that language while warning about the purported implications of Trump’s firing. Her attorneys said in September 2025 that the Supreme Court’s earlier recognition of the Fed’s independence “would have little meaning if a ‘for cause’ restriction gave the President unreviewable discretion to simply deem any governor ‘unfit to serve’ based on anything he deems ’misconduct.'”

Allowing Trump to fire Cook, they said, “would sound the death knell for the central-bank independence that has helped make the United States’ economy the strongest in the world.”

Trump, meanwhile, has underscored the nature of his authority under Article II of the Constitution, which vests the federal government’s executive power in the president.

“Article II allows the President to determine what process to follow when removing executive officers, and courts cause irreparable harm to the separation of powers when they wrongly usurp that authority,” the Justice Department said in its brief.