After a months long legal battle, on July 22nd, US District Judge Amir H. Ali ruled to have former NCUA Board Members Tanya Otsuka and Todd Harper reinstated to their positions. The two were fired by President Trump unexpectedly in April, with no reason for the firings provided, leaving Board Chairman Kyle Hauptman as the sole remaining member of the board.

Quickly following their firings, Harper and Otsuka filed a complaint for declaratory and injunctive relief, claiming that their removal was unlawful, as the NCUA is an independent agency and the President does not hold the authority to remove board members at will. Arguments were heard in May, with the opposing side stating that as head of the Executive Branch, the President reserves the power to fire board members of nearly any agency at will.

Judge Ali disagreed with the sentiment, writing in his 27-page ruling that “the text and history of the NCUA statute, along with the structure and function of the NCUA board, confirm Congress restricted the President’s power to remove Board members.”

The ruling went on to state that the administration’s arguments were without merit or legal ground, noting, “For its part, the government concedes the President lacked any cause for the terminations. The government argues instead that the President maintains absolute authority to remove NCUA Board members at will, and that reinstatement is not an available remedy. These arguments—which the government all but concedes would apply equally to the Chair of the Federal Reserve and FDIC Board members—are unavailing.”

Celebrating the victory, Harper shared a statement on LinkedIn titled “FOR THE WIN!” He wrote: “Today’s ruling in favor of immediately restoring the Board to its full capacity is a real win for the 143 million Americans who rely on the National Credit Union Administration (NCUA) to protect their consumer rights and insure their share deposits. It’s also a win for all credit unions by maintaining the agency’s future independence. I look forward to once again working with my fellow Board members and the outstanding team at the NCUA to ensure our credit union system and our economy remain safe, stable, sound, secure, and fair.”

Otsuka echoed Harpers sentiments in her statement, saying, “The court’s decision is a victory for the rule of law and the millions of people who use credit unions. I look forward to getting back to work to make sure we have a safe and resilient financial system.”

Vincent Levy, a partner at Holwell Shuster & Goldberg LLP, who represented Otsuka and Harper in their lawsuit stated, “The Court’s decision today vindicates Congress’s judgment that the independence of financial regulators like the NCUA Board is necessary to ensure the stability of our financial markets.”

America’s Credit Unions has consistently remained neutral on the topic, refusing to support or condemn the firings, but has repeatedly stated it supports an independent, three-board-member NCUA. In response to yesterday’s ruling, they issued a statement reaffirming that position.

“Judge Amir Ali deemed that Todd Harper and Tanya Otsuka’s removal as independent agency members was unlawful and ordered that they be reinstated, similar to other recent decisions in the U.S. District Court of the District of Columbia,” said ACU President and CEO Jim Nussle. “America’s Credit Unions has been consistent in our support of an independent, three-person board at the NCUA, and we will know soon whether this matter will be stayed and appealed or if the NCUA will return to business as usual.”

Despite the apparent victory for supporters of an independent NCUA, it may be too early to celebrate entirely, as an appeal to the decision is still possible. Just this week, a US appeals court blocked a court order that called for the reinstatement of U.S. Federal Trade Commissioner and Democrat Rebecca Slaughter, who was similarly fired by President Trump in March.

In the meantime, the NCUA board remains in the hands of a single board member and—depending on who you ask—with or without a quorum. Thankfully, as Nussle stated, we will know soon how the ruling will be received.