Washington, Jan 6 (AP) Nippon Steel and US Steel are filing a federal lawsuit challenging the Biden administration's decision to block a proposed nearly USD 15 billion deal for Nippon to acquire Pittsburgh-based US Steel.

The suit, filed Monday in the US Court of Appeals for the District of Columbia, alleges that it was a political decision and violated the companies' due process.

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Nippon Steel had promised to invest USD 2.7 billion in US Steel's aging blast furnace operations in Gary, Indiana, and Pennsylvania's Mon Valley. It also vowed not to reduce production capacity in the United States over the next decade without first getting US government approval.

Biden on Friday decided to stop the Nippon takeover — after federal regulators deadlocked on whether to approve it — because “a strong domestically owned and operated steel industry represents an essential national security priority. ... Without domestic steel production and domestic steel workers, our nation is less strong and less secure," he said in a statement.

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While administration officials have said the move is unrelated to Japan's relationship with the US — this is the first time a US president has blocked a merger between a US and Japanese firm.

Biden departs the White House in just a few weeks.

The president's decision to block the deal comes after the Committee on Foreign Investment in the United States, known as CFIUS, failed to reach consensus on the possible national security risks of the deal last month, and sent a long-awaited report on the merger to Biden. He had 15 days to reach a final decision. (AP)

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