Nippon Steel, U.S. Steel File Lawsuits Against U.S. Govt; CEO Calls Biden Order Blocking Deal ‘Totally Unacceptable’ (UPDATE 1)

The Yomiuri Shimbun

11:21 JST, January 7, 2025 (updated at 16:15 JST)

Nippon Steel Corp. said Monday that it had jointly filed lawsuits with U.S. Steel Corp. in U.S. courts, including one seeking to invalidate U.S. President Joe Biden’s order banning its planned acquisition of the U.S. steel giant.

One lawsuit was filed against Biden and the Committee on Foreign Investment in the United States (CFIUS), a U.S. government agency that screened the merger plan. Nippon Steel alleges that the order to ban its acquisition of the U.S. firm involved unlawful political influence.

Biden’s order “is unlawful political influence and totally unacceptable,” Nippon Steel Chairman and CEO Eiji Hashimoto told a press conference at the company’s head office in Tokyo on Tuesday. “We have no reason or need to give up our business in the U.S.,” Hashimoto said, emphasizing his intention to continue to pursue the acquisition.

Nippon Steel and U.S. Steel are also seeking billions of dollars in damages in another lawsuit against defendants including the major U.S. steel firm Cleveland-Cliffs Inc. and David McCall, president of the United Steelworkers union. They allege that the defendants obstructed the project with false statements.

Hashimoto said that the screening process was not properly conducted due to Biden’s unlawful political intervention. “The CFIUS screening would have resulted in a different conclusion if it had proceeded properly based on law,” Hashimoto said. “It was political intervention from the very beginning, with the conclusion already in mind.”

As for Biden citing national security concerns and other reasons, Hashimoto said: “[The acquisition plan] is the best way for U.S. Steel to remain competitive and continue to grow. It will help strengthen U.S. national security.”

“The plan, which was supposed to be approved without any problems, has taken more than a year, causing delays in our U.S. operations,” Hashimoto said. “We decided to file the lawsuits soon because further delay would not be good.”

He indicated his view that Nippon Steel might be able to win the lawsuits by clarifying that there were problems with the screening process.

Hashimoto also stressed that he is not thinking of any alternatives to a takeover at this stage, and that he is determined to work to make the acquisition a reality.

As to how Nippon Steel will respond to the policies of U.S. President-elect Donald Trump, Hashimoto said: “The acquisition plan will lead to the strengthening of the U.S. industry. I believe that we will be able to gain Mr. Trump’s understanding by properly explaining the plan to him.”