Nippon Steel and U.S. Steel have filed multiple lawsuits after United States President Joe Biden blocked their million-dollar merger.
According to the Biden administration, the proposed acquisition of the second-largest American steel producer by Nippon for nearly US$15 million (A$23.964 million) would threaten U.S. national security.
The lawsuit in the U.S. Court of Appeals for the District of Columbia alleges that the Biden administration used the government review process to reject the merger as a favour to the United Steelworks (USW) labour union.
Nippon Steel and U.S. Steel revealed their plan for a lawsuit in a joint statement where they said they have engaged in “good faith” and to “enhance, not threaten” U.S. security.
“Nippon Steel is the only partner both willing and able to make the necessary investments – including no less than $1 billion to Mon Valley Works and approximately $300 million to as part of the $2.7 billion committed to protect and grow U. S. Steel for the benefit of employees, the communities in which it operates, and the entire American steel industry,” the companies said in a statement.
“We remain confident that the Transaction is the best path forward to secure the future of U. S. Steel – and we will vigorously defend our rights to achieve this objective.”
The decision to block the merger came weeks after a federal committee declined to issue a recommendation, leaving Biden the opportunity to block the agreement. Nippon Steel and U.S. Steel allege that Biden first announced plans to block the merger in March of 2024, before CFIUS began its review of the deal's national security implications.
U.S. Steel and Nippon Steel have also filed a second lawsuit against Cleveland-Cliffs, another domestic steelmaker and USW President David McCall for allegedly illegally coordinating efforts to stop the merger.
Lourrenco Gonclaves, chairman, president and CEO of Cleveland-Cliffs said the lawsuit was “completely baseless” in a statement.
“As of this morning, Nippon Steel and U.S. Steel continue to play the blame game in a desperate attempt to distract from their own failures,” he said.
“U.S. Steel made their bed when they rejected an all-American solution and insisted on pursuing a doomed-to-fail cash out sale to Nippon Steel, a company notorious for evading the trade laws in the United States.”
Before the lawsuit was issued, USW commended Biden for blocking the sale.
“We’re grateful for President Biden’s willingness to take bold action to maintain a strong domestic steel industry and for his lifelong commitment to American workers,” McCall said in a statement.
In December 2024 Trump said he was “totally against” the merger between Nippon Steel and U.S. Steel in a Truth Social post.
“Through a series of Tax Incentives and Tariffs, we will make U.S. Steel Strong and Great Again, and it will happen FAST!” He said.
“As President, I will block this deal from happening. Buyer Beware!!!”