The legal dispute over the removal of National Credit Union Administration (NCUA) Board Members Todd Harper and Tanya Otsuka is moving forward, with the D.C. Circuit Court of Appeals scheduling oral arguments for November 21, according to America’s Credit Unions.
This development comes amid a broader legal showdown over presidential power, with a related case on the Federal Trade Commission (FTC) heading to the U.S. Supreme Court. The panel of judges for the NCUA case will be disclosed 30 days before the hearing.
Harper and Otsuka were dismissed by President Donald Trump on April 16, but they were briefly reinstated in July by a lower court judge to attend a board meeting. However, they were ordered to step down again the following day pending the outcome of the appeals process.
The central issue at hand is whether the president has the authority to remove members of an independent regulatory body without explicit language in the governing statute that restricts this power. Harper and Otsuka argue their removal is unlawful and contradicts congressional intent, while the administration maintains that no such language exists to limit the president’s authority.
The administration’s position has garnered support. A coalition of 21 states, led by Florida, has filed an amicus brief — or “friend of the court” brief — in support of the Trump administration. The brief was filed by Florida Attorney General James Uthmeier on behalf of Alabama, Alaska, Arkansas, Florida, Georgia, Indiana, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia, and the Arizona legislature.
The brief asserts the president has “absolute authority” to remove NCUA Board members, warning that allowing so-called “independent” financial regulators to operate without direct presidential oversight undermines democratic accountability and threatens state sovereignty. The states further argue that “federal officials exercising significant executive authority are removable by the President, and thus accountable to the people. Anything less is inconsistent with the Framers’ design and risks intrusion on state sovereignty.”
The states also contended that the district court erred by reading removal protections into the NCUA statute, and that Harper and Otsuka pursued the wrong legal remedy, a writ of quo warranto. This writ does not authorize reinstatement. They further argued that equity courts historically lacked jurisdiction to reinstate public officials, and that the lower court overstepped by ordering their reinstatement.
Additionally, as the U.S. Supreme Court has decided to review a related case involving ousted FTC Commissioner Rebecca Slaughter, it has already granted a stay, keeping Slaughter off the FTC as her case proceeds. Oral arguments in that matter are set for December, with a decision likely by June 2026. That ruling is expected to provide guidance that could impact the outcome of the Harper-Otsuka lawsuit.
Until the legal challenges are resolved, NCUA Chair Kyle Hauptman remains the sole confirmed member on the three-person board. The outcome of the case could have implications, potentially clarifying the scope of presidential authority over other independent financial regulators beyond the NCUA.
California’s Credit Unions, Nevada’s Credit Unions, and America’s Credit Unions have been engaging policymakers, emphasizing the importance of a balanced and functional NCUA Board that understands the unique nature of credit unions and prioritizes the best interests of credit union members. Credit unions have consistently supported a strong, independent regulator for their industry.
