Judge Blocks Trump From Firing Democratic NCUA Officials (2)

A pair of Democratic board members at the National Credit Union Administration were reinstated to their posts after a federal judge ruled President Donald Trump fired them unlawfully.

Judge Amir H. Ali of the US District Court for the District of Columbia on Tuesday blocked the Trump administration from firing Todd Harper and Tanya Otsuka, citing provisions in the Federal Credit Union Act.

“The statutory text and context, and the structure and function of the NCUA, make clear Congress restricted the President’s authority to fire NCUA Board members,” Amir said. “And Congress did so consistent with the separation of powers because the NCUA Board fits comfortably within the traditional model of a multimember expert agency that does not wield substantial executive power.”

The two NCUA board members had argued that the president had the power to fire them only for cause and that the agency can’t function with solely its chairman, Kyle Hauptman, sitting on the board.

“Today’s ruling in favor of immediately restoring the Board to its full capacity is a real win for the 143 million Americans who rely on the National Credit Union Administration (NCUA) to protect their #consumer rights and insure their share deposits,” Harper said in a statement posted to LinkedIn.

Otsuka in the statement said she looked forward to getting back to work “to ensure our credit union system and our economy remain safe, stable, sound, secure, and fair.”

Hauptman has said the NCUA board can still take substantive actions with only one board member.

The NCUA declined to comment Wednesday. The White House and the Treasury Department didn’t immediately respond to requests for comment.

The Trump administration filed a notice of appeal to the US Court of Appeals for the District of Columbia Circuit late Tuesday and asked Ali to stay his ruling as the case moves forward.

NCUA Firings

Trump fired Harper, the NCUA’s former chairman under President Joe Biden, and Otsuka, a Biden appointee, on April 15 without providing any justification.

The two Democratic appointees sued to block the terminations on April 28, arguing that Trump’s actions were illegal.

The Federal Credit Union Act requires only that board members serve staggered six-year terms, without providing specific for-cause removal protections under amendments Congress implemented in 1978.

But Harper and Otsuka argued the defined six-year terms indicate Congress’ intent to bar the president from firing them without cause.

Credit unions will be watching the Trump administration’s appeal, according to a statement from Jim Nussle, president and CEO of America’s Credit Unions, an industry trade group.

“America’s Credit Unions has been consistent in our support of an independent, three-person board at the NCUA,” Nussle said.

Independent Regulators

The ruling adds to a sprawling fight over Trump’s power to control independent federal agencies.

The US Supreme Court in its June ruling in Kennedy v. Braidwood Management Inc.—a case ostensibly about Obamacare preventive health-care coverage—made clear that members of independent commissions have removal protections only if Congress explicitly said so. That decision appeared to further stack the deck against Harper and Otsuka.

The high court previously ruled that the administration doesn’t have to reinstate Democratic officials at the National Labor Relations Board and the Merit Systems Protection Board whom Trump fired while they challenge their terminations. The Supreme Court in that ruling shielded Federal Reserve board members from any efforts to fire them.

It has yet to rule on Trump’s power to fire Democratic officials from other agencies including the Federal Trade Commission.

The Supreme Court is separately weighing whether to reverse its 1935 Humphrey’s Executor decision that provided some protections to members of independent regulators, including the Fed and the Securities and Exchange Commission.

“We will keep fighting to make sure the agency can do its job for the American people—and fighting back against the Trump Administration’s lawless actions,” Sen. Elizabeth Warren (D-Mass.), the ranking member of the Senate Banking Committee, said in a statement.

Holwell Shuster & Goldberg LLP represent Harper and Otsuka.

The case is Harper v. Bessent, D.D.C., No. 1:25-cv-01294, Memorandum Opinion 7/22/25.