Paramount and California AG to Discuss Settlement of Antitrust Case Over Warner Bros. Discovery Deal

Paramount and Skydance representatives are scheduled to meet with California Attorney General Rob Bonta on Monday to discuss a possible settlement of the antitrust suit that seeks to block Paramount's $110 billion acquisition of Warner Bros. Discovery, according to a report by The New York Times. The meeting comes after pressure from state officials, including Governor Gavin Newsom and Los Angeles Mayor Karen Bass, as well as industry groups such as the Directors' Guild of America, to resolve the case.

Bonta told CNBC that any settlement would require "robust structural remedies" and emphasized that the state's complaint focuses on three specific markets, not on broader issues such as streaming or foreign regulators. He said, ">[Paramount] wanted to talk about everything except for what this case is about. They want to talk about the streaming market, which we don't allege in our complaint. They want to talk about CNN, which is not a focus of our complaint. They want to talk about the foreign regulators. We want to talk about the three markets that we set forth in our complaint, where we think there's antitrust violation."

The lawsuit, filed by a coalition of 12 state attorneys general in July, argues that the merger would create the largest portfolio of U.S. TV networks and could harm competition. A prior statement from Bonta described the proposed combination as potentially leading to higher prices, lower quality and reduced content for consumers. The deal has been cleared by the U.S. Justice Department's antitrust division and European regulators, but a trial is set for March. If the merger is delayed past Sept. 30, Paramount could incur a quarterly "ticking fee" of about $650 million, and a full breakup would trigger a $7 billion penalty.