US: Judge quashes subpoenas in DoJ's Federal Reserve case

US Federal Judge James Boasberg on Friday slammed the US Department of Justice's (DoJ) investigation into purported cost overruns at the US Federal Reserve as politically motivated and lacking merit, announcing that he would halt investigators' ability to issue subpoenas to agency employees over the matter.

"A mountain of evidence suggests that the Government served these subpoenas on the Board [of the Federal Reserve] to pressure its Chair [Jerome Powell] into voting for lower interest rates or resigning," read a March 11 filing written by Boasberg.

Independent Fed Chair Jerome Powell: This is about political pressure and intimidation

US President Donald Trump, who appointed Powell during his first term, has sought to cajole him into lowering interest rates to juice the US economy, or quit so that he can appoint someone likely open to politicizing the post.

Trump has been relentless in his public attacks, regularly insulting the nation's top banker.

Powell has appeared unflappable throughout, countering Trump even when the president has tried to ambush him in public. 

Powell himself went public with his own statement in January, after the DoJ informed the independent Fed that it had launched an unprecedented investigation into what it described as cost overruns in the renovation of Fed headquarters in Washington DC.

Powell, who has scoffed at the idea of cost overruns, said, "This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation."

Judge slams Trump's DoJ, chief prosecutor vows appeal

"The Government has produced essentially zero evidence to suspect Chair Powell of a crime; indeed, its justifications are so thin and unsubstantiated that the Court can only conclude that they are pretextual," read Boasberg's assessment. "The Court therefore finds that the subpoenas were issued for an improper purpose and will quash them."

Boasberg went on to blast the DoJ's case, writing, "There is abundant evidence that the subpoenas' dominant (if not sole) purpose is to harass and pressure Powell either to yield to the President or to resign and make way for a Fed Chair who will.”

The court's ruling blocks US Federal Attorney Jeanine Pirro, a former Fox News personality, from obtaining records from the US central bank.

Pirro maligned Boasberg, calling him "an activist judge" and his ruling "outrageous," adding, "this is not how our criminal justice system works." She also vowed that the DoJ would appeal the decision.

Trump and the DoJ have butted heads with Boasberg before, with the White House last year citing arcane 18th century wartime authorities to justify ignoring his order to halt deportation flights.

At the time, Trump called Boasberg an unelected "troublemaker and agitator" and demanded he — as well as any other judges who failed to rule in his favor — be impeached.

The president's unbridled insistence at the time prompted a rare public rebuke from Supreme Court Chief Justice John Roberts, who wrote, "impeachment is not an appropriate response to disagreement concerning a judicial decision. The normal appellate review process exists for that purpose."

Retiring GOP senator blasts government case, blocks vote for Powell replacement

Although most Republicans have continued to back Trump — who cannot fire Powell without reason and Powell has refused to step down before his term ends on May 15 — Senator Thom Tillis of South Carolina has been unusually strong in his condemnation of the White House and DoJ's treatment of the Fed chair.

Shortly after Powell's January 11 statement, Tillis, who sits on the Senate Banking Committee and will retire at the end of his term, announced that he would block consideration for Trump's chosen replacement for Powell, Kevin Warsh, until the DoJ dropped its case.

Tillis said in a statement on Friday that Boasberg's ruling showed "just how weak and frivolous the criminal investigation of Chairman Powell is."

"We all know how this is going to end," said Tillis, "and the DC US Attorney's Office should save itself further embarrassment and move on," adding that "appealing the ruling will only delay the confirmation of Kevin Warsh as the next Fed Chair."

Edited by: Sean Sinico