The two Democratic FTC members who were fired by President Trump have filed suit in federal court challenging their dismissal.
Alvaro Bedoya and Rebecca Slaughter filed suit in U.S. District Court for the District of Columbia contending that their dismissals were illegal since the FTC is supposed to be an independent agency. They said that Trump’s decision was in direct violation of federal law and Supreme Court precedent.
In their suit, Bedoya and Slaughter said that under the FTC Act, the President may only remove a commissioner for “inefficiency, neglect of duty or malfeasance in office.” In addition, they said that FTC members are protected by the 1935 decision of the Supreme Court in Humphrey’s Executor v United States, which upheld the constitutionality of the for cause removal standard applicable to FTC commissioners. In its 2020 ruling in Seila Law v. CFPB, the Supreme Court distinguished Humphrey’s Executor in finding the for cause removal standard applicable to the sole director of the CFPB to be unconstitutional.
“In short, it is bedrock, binding precedent that a President cannot remove an FTC Commissioner without cause,” the two said, in their suit. “And yet that is precisely what has happened here: President Trump has purported to terminate Plaintiffs as FTC Commissioners, not because they were inefficient, neglectful of their duties, or engaged in malfeasance, but simply because their ‘continued service on the FTC is’ supposedly ‘inconsistent with [his] Administration’s priorities.’
The two plaintiffs said that the President’s action is indefensible and they ask the court to declare the President’s attempted removals are unlawful and ineffective. They ask that the court rule that Bedoya and Slaughter are still members of their commissions.
They may face an uphill battle though.
In two related cases, involving the President’s attempt to remove a member of the National Labor Relations Board and a member of the Merit System Protections Board, notwithstanding federal laws that place similar restrictions on the President’s removal authority, the D.C. District Court granted summary judgment for the individuals involved, declaring that they remained members of their respective Boards, and issued injunctions prohibiting government officials from enforcing President Trump’s removal orders.
However, the Administration appealed those decisions to the D.C. Circuit Court and sought emergency stays pending appeal. Those stays were recently granted by a 2-1 vote of a panel of the D.C. Circuit, as the two judges who voted for the stays concluded in their respective concurring statements that the Government was likely to succeed in showing that those restrictions on removal are unconstitutional. Their respective decisions were influenced, in part, by the Seila Law ruling.
We invite you to learn more and join us for a webinar at 12:00 PM ET on May 13, 2025 titled “What is Happening at the Federal Agencies (Other Than the CFPB) That is Relevant to the Consumer Financial Services Industry?” Click here to review the topics that will be covered and to register for this webinar.
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