Nippon Steel asks US court to reject ‘baseless’ consumer lawsuit over U.S. Steel bid

By Mike Scarcella

March 20 (Reuters) - Japan’s Nippon Steel has asked a U.S. judge to dismiss a consumer lawsuit seeking to block the manufacturing giant’s proposed $14.9 billion purchase of U.S. Steel that is currently tied up in negotiations with the Trump administration.

Nippon Steel in a Wednesday filing in federal court in San Francisco said the consumers — as downstream buyers of steel products — had not shown they have legal standing to pursue claims that the merger would drive up prices and violate U.S. antitrust law.

The company, Japan’s largest steelmaker and the fourth biggest in the world, called the lawsuit "baseless" and accused the plaintiffs of filing “numerous other unsuccessful antitrust suits asserting generalized grievances about large corporate mergers.”

Attorneys for the plaintiffs and a spokesperson for Nippon Steel did not immediately respond to requests for comment.

The consumers’ lawsuit in February alleged the deal, first announced in 2023, would further consolidate the steel manufacturing market in violation of federal antitrust law.

The Biden administration in January halted the planned acquisition on national security grounds. Nippon Steel and U.S. Steel sued over the decision, telling the U.S. Court of Appeals for the D.C. Circuit that the order blocking the merger was “blatantly unconstitutional.”

Last week, the Justice Department under President Donald Trump told the appeals court that the government wanted more time to complete ongoing discussions concerning the transaction “with the goal of eliminating the need for this court’s resolution of the litigation on the merits.”

The D.C. Circuit pushed back a planned hearing date and said it will now weigh arguments on May 12.

Nippon Steel and U.S. Steel have defended the deal, saying it would help U.S. manufacturing compete with China and provide greater job security for American steelworkers.

The case is Donald Freeland et al v. Nippon Steel, U.S. District Court, Northern District of California, No. 3:25-cv-01240.

For plaintiffs: Joseph Alioto of Alioto Law Firm, and Terence O’Toole of Starn O’Toole Marcus & Fisher

For defendant: David Hennes, Alexander Simkin and Rocky Tsai of Ropes & Gray

Read more:

Trump administration seeks delay in Nippon Steel case for merger talks, filing shows

US consumers sue to stop Nippon Steel's $14.9 bln U.S. Steel takeover