Paramount seeks to overcome state attorneys general challenge to Warner Bros. Discovery acquisition
Paramount CEO David Ellison faces an antitrust lawsuit filed by a coalition of state attorneys general that could delay or add costs to the proposed $110 billion purchase of Warner Bros. Discovery.
Paramount Pictures and Skydance CEO David Ellison is confronting a legal challenge from a group of 12 state attorneys general who have filed an antitrust suit to block his company’s planned acquisition of Warner Bros. Discovery (WBD). The lawsuit, led by California Attorney General Rob Bonta, seeks a preliminary injunction and could force Paramount to divest certain pay-TV assets if the merger proceeds.
Paramount has secured approval from global regulators, including the U.S. Justice Department’s Antitrust Division, and is preparing for a trial scheduled for March. Lead trial attorney Jeffrey Kessler told CNBC the company is ready to appeal to the Supreme Court if necessary. Ellison has expressed confidence that the deal makes strategic sense and will ultimately be completed.
Both sides have indicated a willingness to negotiate outside of court. Bonta said a settlement would require “robust structural remedies,” while Paramount has offered concessions, including commitments to release at least 30 films per year with a 45-day theatrical window for three years. The company also suggested relocating its headquarters, a proposal Bonta dismissed as “blackmail.”
Paramount’s spokesperson declined to comment on the ongoing negotiations. The merger, valued at about $110 billion, would combine Paramount’s portfolio of networks such as CBS, MTV and Nickelodeon with WBD’s assets including HBO Max, CNN and the Discovery channels, creating the largest U.S. collection of TV networks. Analysts note that scale alone does not guarantee market dominance, citing the companies’ ongoing struggles with declining pay-TV revenues and competition from larger streaming platforms.
If the transaction closes, the combined entity would carry roughly $80 billion in debt. Delays beyond September 30 could increase costs for Paramount, which has asked the court to require the suing states to post a $1.88 billion bond to cover fees associated with the postponement.