Cases & Deals

U.S. Steel wins complete victory in steel tariff unfair competition case

Clients United States Steel Corporation

Jones Day client United States Steel Corporation won a complete victory in a high-stakes litigation alleging damages from U.S. Steel’s participation in the Department of Commerce’s 232 tariff proceedings. Jones Day successfully defended U.S. Steel Corporation against a lawsuit brought by the U.S. subsidiaries of Russian steel conglomerate NLMK. In an attempt to chill the domestic steel industry’s participation in the Department of Commerce’s (“Commerce”) process for evaluating steel tariff exclusion requests, NLMK sought over $200 million in damages based on its allegation that U.S. Steel misled Commerce into denying NLMK’s exclusion requests. NLMK filed the suit in Pennsylvania state court, alleging a single count for unfair competition solely under Pennsylvania law. U.S. Steel removed the case to federal court on the grounds that the case involved unique and overwhelmingly federal issues despite asserting only a state law claim, a point which overcame NLMK’s motion to remand. U.S. Steel then moved to dismiss, arguing that the complaint failed to state a claim for unfair competition under Pennsylvania law, that federal law preempts any state law in this area, and that U.S. Steel is immune from liability for its involvement in Commerce’s process under both federal and state law. The district court agreed, explaining that it was skeptical NLMK’s allegations would amount to Pennsylvania unfair competition. Regardless, the court held that the unique national security concerns implicated by the Department of Commerce’s decision to enforce tariffs preempted all state tort claims. The court therefore dismissed the case in its entirety.

NLMK Pennsylvania LLC et al. v. U.S. Steel Corp., No. 2-21-cv-00273 (W.D. Pa.)