Judge Issues Temporary Restraining Order Halting Paramount-Warner Merger
A U.S. district judge granted a 14-day restraining order on the $111 billion Paramount-Warner Bros. Discovery deal after a lawsuit by 12 states alleging antitrust concerns.
U.S. District Judge Araceli Martínez-Olguín on Monday granted a 14-day temporary restraining order that pauses Paramount Global’s proposed acquisition of Warner Bros. Discovery. The order follows a lawsuit filed by a coalition of twelve state attorneys general who argue the merger would lessen competition in theatrical film releases, blockbuster movies and cable television, potentially harming consumers and content creators.
The deal, valued at about $111 billion, would combine Paramount’s and Warner’s film and television studios, streaming services Paramount+ and HBO Max, broadcast network CBS, and a portfolio of 50 cable channels, along with news divisions CBS News and CNN. California Attorney General Rob Bonta said the ruling represents “a critical first win” in the states’ effort to block the merger.
Paramount responded that it believes the antitrust claims lack merit and that the transaction is lawful, pro-competitive and beneficial to consumers, creators and workers. The company also expressed appreciation for the court’s swift action, noting it had hoped to close the deal by July 22.
Judge Martínez-Olguín wrote that the plaintiffs presented “compelling evidence” that the combined entity would command a substantial share of the wide-release theatrical distribution market, and that this alone could presumptively violate antitrust law. She dismissed Paramount’s argument that competition from digital platforms such as Netflix, Apple and Amazon negates the concern, describing the streaming market as ancillary to the case.
The states are seeking a preliminary injunction that could extend the freeze indefinitely while the broader antitrust case proceeds. A longer delay would increase Paramount’s financial obligations, including a “ticking consideration” payment of roughly $650 million for every 90-day postponement after October 1, and a potential $7 billion penalty if the merger is not completed by June 4, 2027. The judge set a hearing on the preliminary injunction for August 3.
The merger has attracted additional scrutiny because of the Ellison family’s ties to President Donald Trump and the prospect of two major news outlets—CBS News and CNN—coming under common ownership. While the Justice Department has approved the transaction, the Federal Communications Commission has yet to grant the necessary broadcast license approvals.