A federal judge blocked the Justice Department’s move to subpoena Federal Reserve records, a significant setback in its inquiry into central bank chief Jerome H. Powell and his testimony about the Fed’s renovations of its headquarters.
Chief U.S. District Judge James E. Boasberg in D.C. quashed a pair of subpoenas tied to the investigation and ordered the docket in the case unsealed after attorneys for the Fed and U.S. Attorney Jeanine Pirro’s office battled over the legality of the probe in a closed-door hearing this month.
The judge’s ruling, dated Wednesday and unsealed Friday, criticized the Justice Department’s efforts to investigate several of President Donald Trump’s perceived political foes since last year and said the Powell inquiry was the latest instance of weaponizing law enforcement for political ends.
“A mountain of evidence suggests that the Government served these subpoenas on the Board to pressure its Chair into voting for lower interest rates or resigning,” Boasberg wrote in the opinion. “On the other side of the scale, 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.”
Pirro, a close ally of Trump, said the Justice Department would appeal the ruling.
Last year, Pirro opened an investigation into whether Powell gave misleading testimony to Congress in the summer regarding the Fed’s $2.5 billion renovation of its headquarters overlooking the National Mall. Trump and some other Republicans have questioned the building’s amenities and rising costs.
A grand jury issued subpoenas to the Fed seeking records or testimony about the renovation, with a Jan. 29 deadline, The Washington Post has reported.
Powell has denied wrongdoing. After the subpoenas were issued, Powell, in an unprecedented Jan. 11 video statement, publicly revealed the investigation’s existence and called it an attack on the Fed’s independence.
The ruling marks the latest setback for Pirro, whose office struggled with another high-profile case against Trump’s political foes. Last month, a grand jury, rejecting a case brought by her office, declined to indict six Democratic lawmakers over comments to military service members.
In his opinion, Boasberg said the government’s “sole justification for investigating the renovation is that it went ‘far over budget, raising the specter of fraud.’ But buildings often go over budget. That fact, standing alone, hardly suggests that a crime occurred.”
He added that he offered prosecutors an opportunity to show him privately any additional evidence that might justify the investigation and that they declined to do so.
Under the circumstances, he wrote, “it is hard to see the renovations and testimony as anything other than a convenient pretext for launching a criminal investigation that the Government launched for another, unstated purpose: pressuring Powell to knuckle under.”
The Post previously reported on the legal dispute over the subpoenas, which had been under seal because they related to a grand jury investigation.
The extraordinary probe into the head of the central bank, which has drawn criticism from Democrats and Republicans, has become a significant political problem for Trump.
The president has nominated Kevin Warsh to replace Powell, whose term as Fed chair expires mid-May. Sen. Thom Tillis (R-North Carolina), a key Republican member of the Senate Banking Committee, has said he will not allow Warsh’s nomination to advance until the investigation ends.
On Friday, Tillis took to X to discourage an appeal from Pirro, saying Boasberg’s ruling confirms “just how weak and frivolous the criminal investigation of Chairman Powell is.”
“We all know how this is going to end, and the D.C. U.S. Attorney’s Office should save itself further embarrassment and move on,” Tillis said.
Tillis and several other Republicans on the Banking Committee — including the panel’s Republican chairman — have said they don’t believe Powell committed a crime in his June testimony, which briefly touched on the office renovations.
This ruling confirms just how weak and frivolous the criminal investigation of Chairman Powell is and it is nothing more than a failed attack on Fed independence. We all know how this is going to end and the D.C. U.S. Attorney’s Office should save itself further embarrassment…
— Senator Thom Tillis (@SenThomTillis) March 13, 2026
At a news conference Friday afternoon, Pirro defended the investigation and called Boasberg an “activist judge” whose decision “neutered the grand jury’s ability to investigate crime.”
The Fed’s renovation was at least $1 billion over budget, and “the American public is fed up with public money that seems to go into a black hole,” she said.
Pirro declined to respond to Tillis, but she said Boasberg was wrong to say in his opinion that she had “promptly complied” with directions from Trump to prosecute the Fed chair.
In the opinion, Boabserg said Pirro had acted on apparent directions from Trump to investigate Powell, laying out a timeline of how the probe followed Trump’s public criticism of the Fed chair and his calls to criminally charge his political foes.
“Being perceived as the President’s adversary has become risky in recent years,” Boasberg wrote. “In his second term, Trump has urged the Department of Justice to prosecute such people, and the Department’s prosecutors have listened.”
Pirro said that in addition to an appeal, prosecutors also would be filing a motion for reconsideration in Boasberg’s court, because some of the dates in his timeline were incorrect, she said.
“As far as I’m concerned, this was something that was of public interest. It was something that the Senate Banking Committee wanted information on. And it is something within my jurisdiction and my charge,” Pirro said.
“I’ll deal with the devil — I’ll take a case from the devil — if you can give me information that will lead me to possibly find a crime,” she said. “It doesn’t matter where a case comes from.”
Documents released Friday also suggest the outcome of the case could help determine Powell’s decision to remain at the Fed as one of seven members of its board of governors, after his tenure as chair expires. Powell could elect to stay through early 2028 as a governor, depriving the White House of a crucial seat on the board.
In a readout of a previously unreported Jan. 29 meeting with Pirro, Powell’s personal attorney said the chair “would not leave the board when his term as chair expires if he was still under investigation.”
Aaron Schaffer contributed to this report.
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