Biden Removes Chief of Housing Agency After Supreme Court Ruling

The court issued a similar decision last year, ruling that a law insulating the director of the Consumer Financial Protection Bureau from presidential supervision violated the separation of powers.

Since the housing agency’s shareholders and the Trump administration had agreed that the law creating the agency’s structure was unconstitutional because it barred the president from firing its director without cause, the court appointed Aaron L. Nielson, a law professor at Brigham Young University, to defend the law when the case, Collins v. Yellen, No. 19-422, was argued in December.

The laws creating the two agencies were different, Mr. Nielson argued. Before the court’s decision in the case on the consumer bureau, its director could be fired only for “inefficiency, neglect of duty or malfeasance,” a demanding standard.

By contrast, the director of the housing agency may be fired only for cause, which, Mr. Nielson said, “provides the weakest protection in removal law and can easily be read to allow removal based on policy disagreement with the president.”

Justice Alito disagreed, saying last year’s decision was “all but dispositive.” He also rejected the argument that the housing agency’s specialized responsibilities required a different analysis.

“The president’s removal power serves vital purposes even when the officer subject to removal is not the head of one of the largest and most powerful agencies,” Justice Alito wrote. “The removal power helps the president maintain a degree of control over the subordinates he needs to carry out his duties as the head of the executive branch, and it works to ensure that these subordinates serve the people effectively and in accordance with the policies that the people presumably elected the president to promote.”

Justice Sonia Sotomayor, joined by Justice Stephen G. Breyer, dissented in part.

“The court has proved far too eager in recent years to insert itself into questions of agency structure best left to Congress,” she wrote. “In striking down the independence of the F.H.F.A. director, the court reaches further than ever before, refusing tenure protections to an agency head who neither wields significant executive power nor regulates private individuals.”