U.S. President Joe Biden Accused of Violating Constitution by Blocking Steel Deal
U.S. Steel and Nippon Steel have filed a lawsuit alleging that President Biden’s decision to block their $14.9 billion merger on national security concerns is unconstitutional and influenced by politics. The companies claim that Biden’s decision prejudices the Committee on Foreign Investment in the U.S. (CFIUS) and violates their right to a fair review. They are seeking to have the federal court scrap Biden’s decision and allow them to secure approval through a fresh national security review.
The companies claim that Biden’s decision was motivated by his desire to “curry favor with the USW leadership in Pennsylvania in his bid for reelection.” They point out that both Biden and his predecessor, Donald Trump, opposed the merger during the 2020 presidential campaign, and that Trump and Biden had both vowed to kill the deal.
The lawsuit also accuses United Steelworkers (USW) union President David McCall of opposing the merger and allegedly coordinating with Cleveland-Cliffs CEO Lourenco Goncalves to prevent the deal from going through.
The companies’ claims echo concerns raised in a December letter to CFIUS, in which they alleged that Biden’s influence had compromised the regulatory review process. The White House has yet to comment on the lawsuit, while the Justice Department, Treasury Department, and USW also have not responded to requests for comment.
Experts note that courts typically give deference to CFIUS’ definition of national security, which may make it challenging for the companies to prove their case. However, the lawsuit marks the beginning of a legal battle that could have far-reaching implications for the steel industry and the process of reviewing foreign investments in the United States.
