Why this post?
From time to time it comes up that someone thinks that the FED has debased the currency, which is fraud and theft, and therefore thinks it is a good idea to lawyer-up and sue the FED or its mouthpieces such as Ben Bernanke, or Ole’ Yellen. The legal theories of recovery stretch from the mundane (fraud/theft) to the extremely creative (Qui Tam). So, what’s the problem? They CAN be sued, right? Well, yes, technically, they CAN be sued. But ultimately, the lawsuits will be dismissed upon motion, which motion to dismiss will be granted, and whoever decided to sue will be stuck paying the costs of the ill-fated adventure into the hallowed marble edifices of the regime, known more commonly as United States Federal Court.
Any fraud or theft lawsuit against the FED have, and will, all share a common element: they ALL have zero chance of recovery, for many reasons, philosophically, practically, and more importantly, factually and legally. The only exception I am aware of is for a Freedom of Information Act lawsuit, which can, and has been successfully done. See here: But, this is not a post about getting documents under a FOIA request from the FED.
This is a post about the propriety, or really, the absurdity, of suing the FED for harm that they ostensibly cause from their operations itself.
An attempt to sue the FED, or Bernanke, or Yellen, or any of the FED Governors, will be met with swift opposition, an order granting the dismissal motion, then certain consequences against the attorney who foolishly tries to embark on such a lawsuit (Rule 11 Sanctions, State Bar ethics complaint, etc.)
So, thinking about suing the FED? Is it a good idea?
The short answer is NO, not now, not ever.
Instead, do something productive. Focus on accumulating tangible resources and assets, shed liabilities and debts, prepare and help others.
There is a reason why attorneys are not filing these cases, at least here in the USA (one brave Chinese attorney is pioneering a case in China. I’ll take long odds against him that the case goes nowhere, but I won’t go so far as to say they execute the poor lawyer for having the temerity to sue! See here: )
The short answer to the question why the FED cannot be successfully sued is simple. And, it is unlikely to change anytime soon, so move on to more productive things to think about.
The FED is an ‘instrumentality’ of the Federal Government. It enjoys sovereign immunity. It, and its people, like Bernanke and Yellen are represented by the deepest pocket attorneys on the planet, the US Justice Department. U. S. Department of Justice represents the Federal Reserve Board of Governors in civil litigation: see, e.g., TCF National Bank v. Bernanke, 643 F.3d 1158 (8th Cir. 2011); McKinley v. Board of Governors of the Federal Reserve System, 647 F.3d 331 (D. C. Cir. 2011); Fox News Network, LLC v. Board of Governors of the Federal Reserve System, 601 F.3d 158 (2d Cir. 2010). They will certainly oppose any lawsuit, swiftly, and the Federal Judge will inevitably grant the motion to dismiss, ending the foolish lark. Don’t do it.
This post was published at TF Metals Report on March 11, 2016.