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The Supreme Court on Wednesday allowed Federal Reserve Governor Lisa Cook to remain in her position for now, declining to act on the Trump administration’s emergency bid to immediately remove her from the central bank.
In a brief unsigned order, the justices said they would hear arguments in January on Republican President Donald Trump’s effort to force Cook off the Fed’s Board of Governors. The decision means Cook can continue serving at least through the end of the year, including at the next two meetings of the Federal Open Market Committee, which sets U.S. interest rates.
The high court’s move marked a rare instance in which Trump did not receive swift relief from the justices in an emergency appeal.
The administration has argued that Trump has the authority to dismiss Cook “for cause,” citing allegations she misrepresented her primary residence on mortgage applications before joining the Fed. Cook, appointed in 2022 by former President Joe Biden, has denied any wrongdoing and said she will not be “bullied” into leaving her post.
“President Trump lawfully removed Lisa Cook for cause from the Federal Reserve Board of Governors,” White House spokesman Kush Desai said in a statement. “We look forward to ultimate victory after presenting our oral arguments before the Supreme Court in January.”
The justices’ order keeps in place a lower-court ruling in Cook’s favor, which found that Trump’s firing violated statutory protections for the Fed’s independence. U.S. District Judge Jia Cobb ruled that governors can only be dismissed for misconduct committed while in office, and said the administration had failed to meet that standard.
A divided panel of the D.C. Circuit Court of Appeals upheld Cobb’s decision last month, rejecting the administration’s request to let Cook’s removal proceed while litigation continues.
Legal experts said Wednesday’s order signals the justices may treat the Federal Reserve differently from other independent agencies.
“The court seems to be steering a different course here,” said Lev Menand, a Columbia Law School professor and author of a book on the Fed. “It has the effect of freezing the status quo that is in favor of Fed independence.”
The court will hear arguments in December in a separate but related case involving Trump’s authority to fire members of other independent regulatory boards, including the Federal Trade Commission. That case could help determine whether judges can block firings outright or may only award back pay if a removal is later deemed unlawful.
Trump’s effort to oust Cook marks an unprecedented challenge to the Fed’s century-old structure. No president has ever fired a sitting member of the Board of Governors, which was established to operate independently from the White House and Congress.
Cook’s lawyers praised the Supreme Court’s order, saying it “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.”
Trump has accused Cook of mortgage fraud, claiming she improperly listed two homes — in Michigan and Georgia — as her “primary residence” in 2021 to obtain favorable loan terms. But documents obtained by The Associated Press appear to contradict those allegations: a May 2021 loan estimate listed her Atlanta condominium as a “vacation home,” and a federal security clearance form described it as a “2nd home.”
Separately, the Senate recently confirmed Stephen Miran, Trump’s nominee to an open seat on the Fed’s board. Both Miran and Cook participated in last month’s policy meeting, in which the central bank cut its key interest rate by a quarter point. Miran dissented, favoring a steeper reduction.
The Supreme Court’s eventual ruling could reshape the balance of power between the White House and the nation’s financial regulator, with broad implications for the Fed’s ability to set monetary policy free from political influence.
