Powell's closed-door Fed meetings spark lawsuit from Azoria Capital: 'Public deserves to know'

FIRST ON FOX: Investment firm Azoria Capital filed a federal lawsuit Thursday morning against Federal Reserve Chair Jerome Powell, alleging that the central bank is violating federal transparency laws.

The lawsuit, which was filed in the U.S. District Court for the District of Columbia, argues that the Federal Open Market Committee’s (FOMC) closed-door meetings run afoul of the Government in the Sunshine Act of 1976.

Additionally, the suit seeks to temporarily bar the FOMC from closing its upcoming July 29-30 meeting to the public. The meeting is where the 12 members of the committee discuss monetary policy decisions — chiefly whether to raise or lower the nation’s interest rate.

Azoria Capital maintains that without real-time access to FOMC deliberations, it cannot adequately assess monetary policy risks, resulting in a competitive disadvantage and increased portfolio volatility.

A draft of the lawsuit, which was viewed by FOX Business, also named all FOMC members: John Williams, Michael Barr, Michelle Bowman, Susan Collins, Lisa Cook, Austan Goolsbee, Philip Jefferson, Adriana Kugler, Alberto Musalem, Jeffrey Schmid and Christopher Waller.

The Federal Reserve declined to comment to FOX Business.

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The FOMC has closed its meetings to the public due to concerns that real-time transparency could potentially disrupt financial markets. Instead, the FOMC makes its policy decisions and minutes public after each meeting.

While the Government in the Sunshine Act outlines 10 specific exemptions for closing portions of federal meetings to the public, Azoria's lawsuit argues that the Fed is misusing Exemption 9(A) to justify keeping FOMC meetings behind closed doors.

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"The exemption policy in the Sunshine Act says that you have to vote as a committee whether to invoke that exemption. They have chosen not to do that," James Fishback, Azoria Capital CEO and founder, told FOX Business. "They're using the same exact exemption 9A every single time. All four meetings this year under Powell, they've used that exemption, and it does not apply if you use it every single time."

Fishback added, "The public deserves to know what's going on, and hiding behind an exemption as an excuse is unacceptable, and in our case, it is illegal. 

"I would say that more transparency is always better than less transparency."

The lawsuit, according to the draft version viewed by FOX Business, also raises concerns that the Fed "is maintaining high interest rates to undermine President Donald J. Trump and his economic agenda."

"If the FOMC’s July 29-30, 2025, meeting is allowed to proceed in secret, it will unlawfully deprive Azoria and the American public of timely access to deliberations that may reveal improper political motives behind the FOMC’s decisions," the draft lawsuit states.

The revelation comes amid a growing standoff between President Donald Trump and Powell over the Fed's reluctance to lower interest rates.

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Trump, who named Powell as Fed chair in 2017, has stepped up his pressure campaign in recent weeks, urging the central bank to lower interest rates to 1% to stimulate economic growth.

Powell's wait-and-see economic policy has kept the central bank’s key borrowing rate within a range of 4.25% to 4.5%. Powell has said that he's also held off cutting rates, in part, to assess the economic impact of Trump's ongoing trade deals. 

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"I expect the Federal Reserve to lean on that argument about market confusion and uncertainty," Fishback told FOX Business when asked about next steps.

"But make no mistake, there is more confusion and uncertainty in the markets today, because we have no idea what the Federal Reserve is doing, and that is why we are suing Jerome Powell."