Judge Considers Blocking Lisa Cook’s Dismissal Ahead of Fed Meeting
A federal judge in Washington, D.C., is deliberating on whether to block the dismissal of Federal Reserve Governor Lisa Cook by President Trump. The hearing took place on Friday, with arguments presented for over two hours by Cook’s lead attorney, Abbe Lowell, and a lawyer from the Department of Justice (DOJ). Cook’s legal team filed a request for a temporary restraining order on Thursday, but US District Judge Jia M. Cobb did not provide a timeline for her ruling.
Cobb emphasized the importance of the Federal Reserve’s independence during the proceedings. The Fed’s Board of Governors and several Reserve Bank presidents are set to convene on September 16-17, 2023, to discuss U.S. monetary policy, which includes potential adjustments to interest rates.
During the hearing, Lowell contended that Cook’s dismissal on August 25, 2023, violated her due process rights. He argued that she was not given adequate time to respond to allegations related to mortgage fraud. Specifically, he claimed the administration failed to demonstrate that her firing was justified. Additionally, Lowell suggested that Cook’s potential dismissal could stem from her perceived dissent against Trump’s agenda, including her academic focus on Diversity, Equity, and Inclusion (DEI) policies.
Lowell further asserted that Cook’s removal was influenced by Trump’s dissatisfaction with Fed Chair Jerome Powell, particularly regarding the Fed’s interest rate decisions. He described the president’s actions as an attempt to undermine the Fed’s independence, stating, “When that failed, he took a swing at the next person up at the plate.”
The controversy surrounding Cook’s firing arose after a criminal referral was made by Bill Pulte, the Director of the Federal Housing Finance Agency (FHFA), alleging that Cook had improperly classified two properties — an Atlanta condo and a Michigan home — as her primary residence in 2021. Notably, Cook only began renting the Georgia property in 2022. Pulte made this referral following disclosures made on August 15, 2023, and filed a second referral on Thursday, asserting that Cook misrepresented her Cambridge, Massachusetts, condo on government ethics forms.
In response to these allegations, Cook filed a lawsuit against Trump, calling his actions “unprecedented and illegal.” Her legal team suggested that a “clerical error” occurred on the loan documents. The DOJ’s attorney, Yaakov Roth, argued that the inaccurate listing of Cook’s primary residence could either be considered intentional — thus criminal — or negligent, justifying her removal. Roth stressed that it was irrelevant whether the alleged inaccuracies occurred before Cook’s Senate confirmation, which passed with a narrow 51-47 vote in September 2023.
Roth questioned the absence of a substantial explanation from Cook regarding the discrepancies in her mortgage documents, stating, “Is there some material factual dispute? I think if there was something like that, we would have heard it by now.”
Both parties were given additional time to submit further briefs following the upcoming Labor Day holiday. The motion for a temporary restraining order is anticipated to be refiled as a request for a preliminary injunction in the near future. The outcome of this case could have significant implications for Cook’s position and the Federal Reserve’s governance structure.
