DOJ, Fed’s Cook Seek Pause in Court Fight Over Trump Firing Push

(Bloomberg) -- Lawyers for the US Justice Department and Federal Reserve Governor Lisa Cook asked a federal judge to keep the legal battle over President Donald Trump's bid to fire her on hold pending a White House hearing set for next month.

Legal teams for DOJ and Cook filed a brief, joint report on Friday to US District Judge Jia Cobb saying the court should pause upcoming deadlines and that they'd come back to her with another update in early January.

The US Supreme Court ruled this summer that Trump failed to give Cook a legitimate opportunity to defend herself before initially trying to fire her last year. The justices allowed Cook to stay in her post for now, sending the case back to Cobb. In August, Trump revived the effort to oust her.

Trump convened a White House committee to investigate whether he has "cause" to remove her — specifically digging into unproven mortgage-fraud allegations against Cook that he relied on in trying to fire her the first time. The panel is set to meet Dec. 14, according to a White House official.

Cook and the White House are discussing the "specifics and details" for how Trump's "committee of inquiry" will proceed, the lawyers wrote in Friday's filing.

Cook has denied wrongdoing and accused Trump of trying to remove her in order to undermine the central bank's longstanding independence. Trump has lashed out at Cook and former Chair Jerome Powell for resisting his calls to cut interest rates.

The Supreme Court didn't directly rule on whether Trump eventually could fire Cook, focusing instead on the due process issue. But Chief Justice John Roberts included strong language in the court's opinion stressing the importance of the Fed's distance from political influence and laying out criteria for when it would be permissible for a president to remove a governor for "cause."

There's been no action in the case in the months that followed. Cobb, presiding in federal court in Washington is likely to keep the proceedings frozen as long as the government and Cook agree that's the best course of action.

Fed officials voted Oct. 28 to hold interest rates steady, though Cook was one of two officials who dissented, preferring instead to raise borrowing costs to help curb inflation. Policymakers are set to meet again Dec. 8-9, when investors expect they will lift rates for the second time this year.