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Nippon Steel and US Steel filed a lawsuit against the outgoing Biden administration on Monday for exercising “unlawful political influence″ over the Japanese firm’s proposed acquisition of US Steel, after President Joe Biden blocked the takeover last week.
The Committee on Foreign Investment in the United States, the government panel tasked with reviewing the merger, “failed to conduct a good-faith, national security-focused review,” and instead “engaged in a process that was designed to reach a predetermined result” that supported Biden’s political agenda, the companies said in a statement. The CFIUS failed to reach consensus on the deal in mid-December, leaving the decision to Biden.
The companies also filed a separate lawsuit against rival steel company Cleveland-Cliffs, its CEO, and the President of the United Steelworkers union, citing “illegal and coordinated actions aimed at preventing the transaction” and undermining Nippon and US Steel’s business practices.
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The lawsuits come as Japan’s prime minister said that there were “concerns” over the future of investment between the two countries. A recent survey showed that the US ranks 11th among countries Japanese firms want to invest in — a poll India topped.
The proposed takeover of US Steel by Nippon Steel has been a rare unifying political topic in Washington, with US President-elect Donald Trump also vowing to block the deal.
Economists, meanwhile, say Biden’s decision risks deterring foreign investment, and some legal experts are also unimpressed: ”What’s infuriating is that Biden claimed to stand for the rule of law and for international alliances,” a Washington-based lawyer told The New York Times. “He told voters ad nauseam that Trump was xenophobic and self-dealing, and now he slaps one of our most important allies in the face on the thinnest of pretenses.”