Paramount and State Attorneys General to Begin Settlement Talks Over Warner Bros. Discovery Merger

Representatives for Paramount Pictures and the group of state attorneys general who sued to block its proposed acquisition of Warner Bros. Discovery are scheduled to meet next week for settlement discussions. The parties remain far apart on key issues, and the plaintiffs may still pursue the antitrust trial set for March.

California Attorney General Rob Bonta said any agreement must include "robust structural remedies" that would reshape the combined company, such as divestitures or spin-offs. Analysts warned that such remedies could be deal-breakers for Paramount, making a settlement unlikely.

Paramount is seeking to merge its film studio and television operations with Warner Bros. Discovery, which owns assets including CNN, HBO and the Warner Bros. studio. A coalition of 12 Democratic state attorneys general filed a lawsuit last month alleging the merger would violate antitrust law and harm the entertainment industry, while the Writers Guild of America filed a separate suit.

The merger faces a "ticking fee" that will increase Paramount’s cost for the acquisition starting Oct. 1, adding pressure for a resolution. Paramount has argued the deal is pro-competitive and that opponents are motivated by political concerns, a claim Bonta has rejected.

Bonta, who has called for a pre-trial resolution, said he is prepared for "good faith" talks but emphasized that discussions would be unproductive without the structural remedies his office demands. > "As I’ve said before, generally for all of my cases, I prefer to resolve disputes in the boardroom, not the courtroom," Bonta told CNN.

Governor Gavin Newsom hinted that informal negotiations may already be occurring, but did not provide details. Both the governor’s office and Paramount declined to comment on the upcoming meeting.

Earlier this week Paramount asked the presiding judge, Araceli Martinez-Olguín, to set a $1.9 billion bond, and the judge scheduled a hearing on the request for Sept. 24. The judge also indicated that the parties must engage in mediation as part of the pre-trial process.

Industry commentator Evan Shapiro noted that the meeting is court-mandated rather than voluntary, suggesting the state’s legal team retains significant leverage.

Bonta reiterated his opposition to the merger, stating it would lead to higher costs, reduced competition, lower wages, job cuts and fewer entertainment offerings, and affirmed his commitment to enforce antitrust law.