The E. Barrett Prettyman U.S. Courthouse, home of the U.S. District Court for the District of Columbia. Photo: Diego M. Radzinschi/ALM
A federal judge on Wednesday heard oral arguments in the high-profile lawsuit brought by former NCUA Board Members Todd Harper and Tanya Otsuka, who alleged their removal by President Donald Trump in April violated federal law and the Constitution’s separation of powers.
Harper and Otsuka were both in the courtroom for Thursday's hearing.
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U.S. District Judge Amir H. Ali presided over the hearing in Harper et al. v. Scott et al., during which the plaintiffs’ attorney, Vincent Levy, argued that Congress intended to shield NCUA Board members from at-will removal when it restructured the agency in 1978. “There were express words in the pre-1978 statute that provided for service at the pleasure of the president,” Levy said. “Congress struck that provision, and that must mean something.”
Levy likened the NCUA to independent financial regulatory agencies like the Federal Reserve and FDIC, which, despite lacking explicit statutory protections, are widely considered insulated from political interference. “Every authority the government says is ‘too executive’ — the FDIC and Fed already do,” he said.
Government attorney Elisabeth Neylan countered that the NCUA performs “quintessential exercises of executive power” and that there is no clear statutory text restricting presidential removal. “Even if Congress intended such protections, it must say so unambiguously in the law,” Neylan stated.
Judge Ali pressed both sides on whether the NCUA’s structure and function resemble agencies with implied protections and questioned the practical consequences of politically motivated removals in financial regulation. Levy warned that politicizing the NCUA could destabilize markets and undermine confidence in credit unions’ oversight.
The case also raised questions about the appropriate remedy. Levy said reinstatement of Harper and Otsuka would be proper, while Neylan argued such action would be unconstitutional, asserting that courts lack the authority to interfere with presidential appointments.
Judge Ali took the matter under advisement and is expected to issue a written ruling soon.
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
