CMC continues legal battle with Pacific Steel Group

Electric arc furnace steelmaker and metals recycler CMC says it will file an appeal to continue a legal case in which it is involved with rebar fabricator Pacific Steel Group, based in San Diego.

The week of Sept. 27, Irving, Texas-based CMC posted a statement on its website announcing it had received an adverse ruling relative to post-trial motions it had filed in the Pacific Steel case.

Late last year, a jury in California ruled in favor of Pacific Steel after it alleged a noncompete agreement between CMC and an electric arc furnace (EAF) technology vendor played out as an unfair restraint of trade practice.

The details of that case, as spelled out in a 68-page legal filing, show Italy-based Danieli & C. S.p.A. as withdrawing from cooperating with Pacific Steel to build a new EAF mill after CMC objected to the plans.

The jury in that case ruled in favor of Pacific Steel and awarded an amount of $110 million, which will be trebled as a matter of law, plus attorneys’ fees, wrote CMC in a news release issued at that time.

By early this year, CMC announced it would be taking a charge against earnings because of the verdict in the financial quarter that ran from September through November 2024.

More recently, the same court upheld the jury's verdict Nov. 5, 2024, in favor of Pacific Steel Group.

"We are very disappointed by the outcome," CMC says.

CMC also plans to appeal to the U.S. Court of Appeals for the Ninth Circuit, based in San Francisco, and says it “stands by the strong integrity of its business practices and will vigorously defend its position.”

On its LinkedIn page, Pacific Steel Group has made several recent posts outlining progress being made in building its recycled-content EAF mill in Mojave, California.

The company says Rep. Vince Fong (R-California) was one recent visitor to the project site. In its post recounting the visit, Pacific Steel writes, “This project is proof of what’s possible when industry, community and strong leaders come together to drive economic growth and innovation in American manufacturing.”

In another LinkedIn post, Pacific Steel refers to the project as a $1 billion micromill that is the first steel mill built in California in more than 50 years. The company estimates the mill will be able to produce about 450,000 tons of recycled-content steel rebar annually and is investing to make solar power a key component of the project.