A landmark Supreme Court precedent from 1935, Humphrey’s Executor, which protects independent regulatory officials from being removed by a U.S. president without “cause,” is now under threat. The legal battle began when President Donald Trump attempted to dismiss Federal Reserve Governor Lisa Cook, citing alleged mortgage-application errors. This move triggered a lawsuit arguing the removal may violate the Federal Reserve Act’s “for-cause” clause.
A district court judge temporarily blocked her removal, determining the allegations did not clearly meet the legal threshold required. An appeals court then upheld that ruling, meaning Cook remains on the Fed board for now. The administration, however, has appealed to the U.S. Supreme Court, seeking to overturn those decisions.
Legal experts view this case as pivotal: if the Supreme Court sides with the administration, it could significantly weaken the legal protections that have preserved the Federal Reserve’s independence for nearly a century. While some judgments have already eroded similar protections for other agencies, the Fed has until now been treated as distinct — a “quasi-private” institution with unique legal safeguards.
