The case, filed Thursday in federal court in Washington, argues that Trump’s action violated the Federal Reserve Act (FRA) and her Fifth Amendment rights, according to Yahoo! Finance.
Cook, appointed in 2022 to a term expiring in 2038, is requesting an injunction that would confirm her active status while the case proceeds. A hearing on the injunction is scheduled Friday before Judge Jia Cobb. The outcome of the temporary restraining order could determine whether Cook participates in the upcoming Federal Open Market Committee meeting on Sept. 17.
Mortgage filing dispute and legal arguments
The president announced Cook’s dismissal Monday, citing allegations that she listed two properties as her primary residence on separate mortgage applications. According to The New York Post, the allegations originated from Federal Housing Finance Agency Director Bill Pulte, who claimed Cook misrepresented her residency status in 2021.
Cook’s legal team, led by attorney Abbe Lowell, contends that the filings were at most a “clerical error” made before her Senate confirmation and that there is no evidence of intentional misconduct. Court documents reviewed by The Guardian state that an unsubstantiated allegation tied to a private mortgage “is not cause” for removal under the FRA, which limits termination of a governor to proven “inefficiency, neglect of duty, or malfeasance in office.”
Cook’s lawyers also argue that she was denied due process because she received no formal notice or hearing before her removal was made public. They assert that the president’s action aims to open a board seat to further his policy agenda.