According to Zhitong Finance APP, United States Steel (X.US) is unlikely to convince the court to overturn President Biden's decision to block their $14.9 billion merger, but their lawsuit may give them more time to reach an agreement with the incoming President Trump.

In the lawsuit announced by the two companies on Monday, they argued that Biden blocked the merger through a false National Security review, depriving both companies of their right to fair procedures and violating the Constitution.

Nick Klein, a National Security lawyer at DLA Piper, said that suing the government would be a "hard battle," noting that courts typically defer very much to the executive branch on National Security issues.

However, "the lawsuit will give them more time to negotiate with the new administration or find an acceptable alternative," Klein added.

These comments indicate that although the lawsuit itself may be destined to fail, if the two companies can persuade Trump to change his opposing stance, it might bring new life to the deal.

"I am completely opposed to the once-powerful United States Steel Company being acquired by foreign companies, this time by Japan's Nippon Steel," Trump wrote on his Social Media platform Truth Social last month.

I will prevent this Trade from happening. Attention buyers!!

But some lawyers saw an opportunity. National Security attorney Joshua Gruenspecht from Wilson Sonsini stated that Trump "has a history of changing his mind," and he also believes this lawsuit is a game to buy time.

Thirty-day deadline.

The order signed by Biden last Friday gives these companies 30 days to unwind the Trade. While these companies did not explicitly request the court to stay the enforcement of the order, a copy of the lawsuit indicates they intend to ask the government if it plans to enforce the 30-day requirement.

The document states that if this is the case, the two companies may seek "preliminary relief." Meanwhile, the merger agreement stipulates that June 18 is the deadline to obtain regulatory approval and complete the merger.

Due process rights.

These companies claim that the National Security review led by the Committee on Foreign Investment in the USA (CFIUS) was unfairly influenced by Biden, who targeted this Trade as early as March, before the review began. The committee is responsible for assessing whether foreign investments pose a threat to National Security.

They claim that Biden's opposition to the Trade is to appease David McCall, president of the United States Steel Workers Union, hoping that McCall's support will help him win Pennsylvania, a swing state, in the upcoming USA presidential election in November. The headquarters of United States Steel Company is located there. Later, Vice President Kamala Harris replaced Biden as the new presidential candidate, and she opposed the Trade as well, receiving support from the United States Steel Workers Union.

The White House and the United States Steel Association denied these allegations. However, both companies indicated that these facts equate to CFIUS and Biden violating the constitutional and regulatory due process rights granted to them, as they made a pre-judgment on the case rather than deciding based on real national security risks.

The regulation states that the President "shall review (the trade) through the committee to determine the impact of the trade on U.S. National Security."

However, former CFIUS officials at the Pentagon and National Security attorney Tatiana Sullivan from Sidley Austin stated that CFIUS regulations explicitly prohibit court review of the President's decisions. Moreover, the courts' high respect for national security decisions means that the situation for these companies is quite challenging.

However, she pointed out that these companies' argument is that "the President's actions and public statements undermined CFIUS's review process, thereby resulting in a due process violation," which is a new claim that the court needs to consider.