DOJ Supports Paramount in Bond Dispute Over Warner Bros. Discovery Merger
The Justice Department filed a brief urging a court to require a bond from state attorneys general challenging Paramount's $111 billion acquisition of Warner Bros. Discovery, arguing the bond is needed to protect defendants.
The U.S. Department of Justice filed a 17-page brief in federal court on Tuesday supporting Paramount Global’s request for a bond in the litigation brought by several state attorneys general over the company’s $111 billion purchase of Warner Bros. Discovery. The filing argues that a bond "forces parties to have skin in the game" and protects defendants from damages caused by an injunction later found to be improper, citing precedent under the Clayton Act.
State attorneys general from California, New York and other states have contested the merger on antitrust grounds and have asked that any financial security be limited to a nominal amount. The DOJ countered that extraordinary losses and a $7 million-per-day fee in the Warner Bros. Discovery contract, which begins on Oct. 1, justify a larger bond.
The brief notes that Congress intended the federal government to complement private antitrust enforcement but did not create an "equal" system, and it interprets the statutory language to require a bond that adequately compensates defendants for potential wrongful injunctions.
A hearing on the bond issue is scheduled for Sept. 24, with settlement talks set to resume later in October. The trial over the merger is slated to begin in March 2027. The California attorney general’s office did not respond to requests for comment.