An attorney told Newsweek that the Supreme Court’s ruling in May 2025 has somewhat put the conservative-led body «in a box» regarding Fed rules.
President Donald Trump’s Monday firing of Federal Reserve Governor Lisa Cook begs scrutiny of a Supreme Court ruling earlier this year seemingly exempting the Fed and board members from presidential terminations.
Her removal has no legal basis, according to Cook’s legal counsel, Abbe Lowell, in a statement shared with Newsweek on Tuesday.
«President Trump has no authority to remove Federal Reserve Governor Lisa Cook. His attempt to fire her, based solely on a referral letter, lacks any factual or legal basis. We will be filing a lawsuit challenging this illegal action», said Lowell.Why It Matters
The Supreme Court issued a narrowly tailored order on May 22, 2025, granting a stay that allowed the administration to remove members of the National Labor Relations Board (NLRB) and the Merit Systems Protection Board while signaling that the Fed was independent and distinct from those agencies.
The Federal Reserve Act provided that governors serve 14-year terms and could be removed only «for cause», a statutory standard that had rarely been litigated in the context of Fed membership but has become central to the legal battle now escalating between Trump and Cook.
Justices wrote the following in their May order: «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.»
But Trump has attempted to defy past legal precedent and pointed at decades-old Court cases as a potential workaround to remove Fed Chair Jerome Powell, whom the president has continually ridiculed for perceived shortcomings including not lowering interest rates.
