Supreme Court Reshapes Presidential Firing Power: Strips FTC Independence, but Shields the Federal Reserve

Supreme Court Reshapes Presidential Firing Power: Strips FTC Independence, but Shields the Federal Reserve

In a pair of historic, back-to-back rulings issued on June 29, 2026, the U.S. Supreme Court dramatically reshaped the boundaries of federal executive power and the independence of regulatory agencies.

The Fall of FTC Independence (Trump v. Slaughter)

In Trump v. Slaughter, the Court ruled 6-3 that the Federal Trade Commission's (FTC) statutory for-cause removal protection under 15 U.S.C. § 41 is unconstitutional. The decision officially overruled the landmark 1935 precedent Humphrey’s Executor v. United States, which had stood for nearly a century as the constitutional foundation for independent regulatory agencies.

Writing for the majority, Chief Justice John Roberts concluded that because the FTC "unquestionably exercises executive power"—including the authority to promulgate substantive rules, conduct investigations, and file civil enforcement actions on behalf of the United States—its commissioners must be removable by the President at will. Chief Justice Roberts wrote:

"The Constitution vests the whole executive power in the President and charges him with ensuring the laws are faithfully executed, so officers who wield that power must be removable by him at will."

In a concurring opinion, Justice Neil Gorsuch urged the Court to go further, calling on the judiciary to deploy the major questions and nondelegation doctrines to rein in the vast legislative and judicial powers that Congress has delegated to these newly executive-controlled agencies.

In a stinging dissent, Justice Sonia Sotomayor, joined by Justices Elena Kagan and Ketanji Brown Jackson, warned that the majority’s ruling represents a dangerous aggrandizement of the imperial presidency, elevating the President above co-equal branches and dismantling the structural independence of expert federal commissions:

"The majority's rule hands the President power unknown even to the English Crown, elevating him above his once co-equal branches and reshaping the federal government."

This ruling represents the culmination of the administration's long-term campaign to strip independent agencies of their historical insulation from executive control, allowing for the immediate removal of disfavored commissioners.

Shielding the Federal Reserve (Trump v. Cook)

In a surprising turn, the Court drew a sharp constitutional line at the nation's central bank. In Trump v. Cook, decided on the same day, a 5-4 majority denied the government's application to stay a preliminary injunction keeping Federal Reserve Board Governor Lisa Cook in office following her attempted removal by President Trump.

The Court decided the case on a narrow statutory ground, holding that the President had failed to comply with the explicit notice-and-hearing requirements set forth in the Federal Reserve Act, 12 U.S.C. § 242. Crucially, the majority affirmed that the Federal Reserve's for-cause removal protection remains constitutional, preserving the central bank's insulation from political interference in monetary policy.

Chief Justice Roberts, writing for a majority that included Justices Sotomayor, Kagan, Kavanaugh, and Jackson, held that the President's determination of "cause" is judicially reviewable, and that "cause" demands a high threshold of professional misconduct or neglect of duty:

"The Federal Reserve's for-cause removal protection is consistent with Article II of the Constitution, declining to unsettle a special arrangement sanctioned by history in which monetary policy is not subject to political interference."

In a separate concurring opinion, Justice Jackson emphasized that the stay application could be resolved on the equities alone, as the government had failed to establish any irreparable harm from Cook remaining in office.

Justice Clarence Thomas dissented, joined by Justice Samuel Alito and Justice Neil Gorsuch, arguing that the Federal Reserve's removal protections are unconstitutional under the same Article II principles applied in Slaughter. Justice Alito also dissented separately, while Justice Amy Coney Barrett filed a separate dissent arguing that the injunction was overly broad.

Implications for Federal Power

The back-to-back rulings create a bifurcated landscape of federal administrative power. While the executive has successfully asserted direct, at-will control over major regulatory agencies like the FTC, the Supreme Court has placed a firm constitutional shield around the Federal Reserve¹², preserving its historical independence and establishing that statutory "for-cause" protections for monetary policy remain a valid check on the unitary executive.