Banking and Finance Law Daily Wrap Up, DIRECTORS, OFFICERS AND EMPLOYERS—D.C. Cir.: Fired NCUA Board members seek renewed briefing schedule after Supreme Court rulings, (Jul 7, 2026)

By Shashi Kant, BALLB, LLM

Harper and Otsuka argue that recent Supreme Court decisions clear the way for their reinstatement appeal to proceed.

Formerly removed National Credit Union Administration Board members Todd M. Harper and Tanya F. Otsuka asked the U.S. Court of Appeals for the District of Columbia Circuit to lift the abeyance in the government’s appeal and reinstate an expedited briefing schedule. The government opposed significant expedition, arguing that it is still assessing how to proceed after recent Supreme Court decisions addressing removal protections for federal officers. The appeal concerns a district court order declaring Harper’s and Otsuka’s removals unlawful and reinstating them to the NCUA Board (Harper v. Bessent, No. 25-5268 (D.C. Cir. July 2, 2026)).

Background. Harper and Otsuka sued after receiving termination notices from the White House in April 2025. Harper’s six-year term is scheduled to expire in April 2027, while Otsuka’s term is scheduled to expire in August 2029. The district court granted summary judgment in their favor, declared the terminations unlawful, and ordered them reinstated to the NCUA Board. The court held that NCUA Board members may be removed by the President before the expiration of their terms only for cause (see Banking and Finance Law Daily, July 23, 2025). The government appealed and filed an opening brief in September 2025 challenging the district court’s ruling. The government argued that Congress did not expressly restrict the President’s removal authority, that any implied restriction would violate separation-of-powers principles because the NCUA exercises substantial executive power, and that the district court lacked authority to order reinstatement of removed principal officers (see Banking and Finance Law Daily, Sept. 17, 2025).

The D.C. Circuit stayed the district court’s judgment pending appeal and initially set an expedited briefing schedule. The court later held the appeal in abeyance pending the Supreme Court’s disposition of Trump v. Slaughter and directed the parties to file motions to govern future proceedings within 30 days of that disposition.

Motion to resume appeal. Harper and Otsuka argue that the Supreme Court’s decisions in Slaughter and Trump v. Cook clear the way for the appeal to proceed and strengthen the district court’s judgment. According to their motion, Slaughter overruled Humphrey’s Executor but preserved removal protections for entities that historically have played a unique role in overseeing the national financial system, including the Federal Reserve. They also argue that Cook reaffirmed the Federal Reserve’s independence based on its historical role in insulating monetary policy from political interference. Harper and Otsuka contend that the NCUA falls within that same historical lineage. They say Congress modeled the NCUA on the Federal Reserve, that both agencies perform comparable financial-market regulatory functions involving chartering, supervision, and liquidity provision, and that the NCUA’s governing structure mirrors the Federal Reserve’s form and design. They also argue that the NCUA lacks the executive power that made for-cause removal protections unconstitutional for Federal Trade Commission members in Slaughter, including the power to file civil suits on behalf of the United States.

The Board members further argue that Cook resolves two additional issues. First, they say the Supreme Court reaffirmed that Congress may implicitly incorporate for-cause removal protections where a statute gives officers fixed terms. Second, they say Cook rejected the government’s argument that a court lacks power to keep a removed federal officer in office during litigation where injunctive relief is otherwise warranted. Harper and Otsuka asked the D.C. Circuit to require any updated government opening brief within 21 days, their response brief 21 days later, and the government’s reply 14 days after that. They also requested oral argument at the court’s earliest convenience.

Government response. The government opposed the request for significant expedition. It argued that the Supreme Court’s decisions in Slaughter and Cook do not justify a highly expedited briefing schedule, particularly because the case had been held in abeyance for nearly a year. The government said the D.C. Circuit had given the parties 30 days after Slaughter to file motions to govern further proceedings. The government also said the recent Supreme Court decisions have implications for numerous removal-related cases involving federal officers and regulated parties challenging statutory removal restrictions. It stated that it is still determining how to proceed in this case and others and will file its own motion to govern further proceedings by July 29. The government said it currently does not intend to file a new opening brief and expects to stand on its prior arguments, while addressing intervening developments in reply. It added that if it determines a revised opening brief is necessary, it will advise the court in its forthcoming motion.

Attorneys: Vincent Levy (Holwell Shuster & Goldberg LLP) for Todd M. Harper. Daniel J. Aguilar, U.S. Department of Justice, for Scott Bessent.

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