Judge restores Democrat to Federal Trade Commission, ruling her firing by Trump was illegal

By LEA SKENE and MARK SHERMAN
Associated Press

A federal judge has restored a Democrat to the Federal Trade Commission, ruling that President Donald Trump illegally fired her earlier this year in his efforts to exert control over independent agencies across the government.

U.S. District Judge Loren AliKhan ruled late Thursday that federal law protects FTC commissioners from being removed by the president without cause, citing a key 1935 U.S. Supreme Court decision involving the FTC.

The decision allows Rebecca Kelly Slaughter to resume her duties as commissioner. The FTC website had been updated by Friday morning to show that Slaughter is among four sitting commissioners.

Attorneys for the Trump administration almost immediately declared their intent to appeal, and the case could make its way to the Supreme Court. The conservative-led court already has narrowed the reach of the 90-year-old decision, known as Humphrey’s Executor, and some justices have called for overturning it altogether.

The high court also permitted Trump to fire the heads of other independent agencies. In May, the court allowed Trump to remove members of the National Labor Relations Board and the Merit Systems Protection Board, despite lower court rulings that Humphrey’s Executor should protect them from arbitrary dismissal.

The justices are currently weighing an emergency appeal from the administration to oust three Democratic members of the Consumer Product Safety Commission. Trump fired them in May, but a federal judge restored them to their positions a month later.

The legal fight over the firings also could extend to the Federal Reserve and the prospect of Trump firing Fed chairman Jerome Powell. The justices suggested in May that Trump may not have the same freedom to upend the leadership of the Fed, describing it as “a uniquely structured, quasi-private entity.”

In her opinion, AliKhan said she was required to abide by the Humphrey’s Executor decision, in which the court rebuffed President Franklin Roosevelt and held that FTC commissioners could be removed only for cause, not at the president’s whim.

She said her ruling would uphold “clearly established law that has been enacted by a coequal branch of government, reaffirmed by another coequal branch, and acquiesced to by thirteen executives over the course of ninety years.”

But the judge acknowledged that hers probably would not be the last word. “Defendants are, of course, free to take their quarrels with Humphrey’s Executor to the Supreme Court. This court has no illusions about where this case’s journey leads,” she wrote.

Trump fired Slaughter and Alvaro Bedoya, the commission’s two Democratic members in March. The FTC is a regulator created by Congress that enforces consumer protection measures and antitrust legislation. Its seats typically include three members of the president’s party and two from the opposing party. The commissioners sued to reclaim their jobs, saying they’d been dismissed illegally. Slaughter has four years left in her term as commissioner. Bedoya submitted his resignation in June, and AliKhan dismissed his claim as a result.

“As the Court recognized today, the law is clear, and I look forward to getting back to work,” Slaughter said in a statement Thursday.

During a May court hearing in federal court in Washington, D.C., plaintiffs’ attorneys warned against granting the president “absolute removal power over any executive officer,” saying it would effectively eliminate an important check on his power.

“That has never been the case in this country,” said attorney Aaron Crowell. “That’s not the law. That has never been the law.”

A politicized FTC also could favor powerful corporations while driving up prices for consumers, the lawyers for the fired commissioners said.

But attorneys for the Trump administration argued that the FTC’s role has expanded since the 1930s, and as such, its members should answer directly to the president.

“The president should be able to remove someone who is actively blocking his policies, for example,” Justice Department lawyer Emily Hall said during the hearing.

AliKhan, who was nominated to the federal bench by President Joe Biden in 2023, noted the long line of presidents before Trump who didn’t try to push the limits.

Commissioners are appointed by the president and confirmed by the Senate. They serve seven-year terms that are staggered to prevent multiple vacancies at once. They can be fired for displaying specific bad behaviors, including inefficiency, neglect of duty and malfeasance in office.

Trump told Bedoya and Slaughter that he was dismissing them because their service on the commission was inconsistent with his administration’s priorities, according to the lawsuit.