NEW YORK — A coalition of 12 states sued Monday to block Paramount’s proposed acquisition of Warner Bros. Discovery, arguing the $81 billion deal would “extinguish competition” in Hollywood and put entertainment industry jobs at risk.
California Attorney General Rob Bonta’s office, which is leading the challenge, said the states are seeking to prevent Warner and Paramount from completing the merger “until after the judicial process concludes.” If the companies refuse to delay closing, the coalition said it will seek a temporary restraining order.
“The unlawful merger of these two entertainment behemoths would lead to higher prices, lower quality, and less content for film and television, harming movie theaters, basic cable distributors, and ultimately, audiences on every sofa and movie theater seat in the U.S.,” Bonta said in a statement.
The lawsuit was joined by Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington. Paramount, now owned by Skydance, did not immediately respond to a request for comment Monday, while Warner referred inquiries to Paramount.
Paramount, which Skydance acquired last year, is pursuing a full takeover of Warner Bros. Discovery. The deal would bring major assets including HBO Max, the “Harry Potter” franchise and CNN together with CBS, “Top Gun” and the Paramount+ streaming platform.
The states’ antitrust lawsuit could complicate those ambitions, at least in the near term. The challenge comes at a crucial stage for the Paramount-Warner transaction, which won shareholder approval in April following a highly public bidding battle with Netflix and received clearance from the Trump administration last month.
The U.S. Justice Department has declined to challenge the merger. Instead, it issued an unusually detailed statement backing the deal, saying a combined Paramount and Warner would “increase competition across the media and entertainment ecosystem, with benefits for American consumers and workers.”
Paramount has also pointed to regulatory approvals it says it has secured in several other markets, including China, Canada and Australia. Reviews are still underway elsewhere, including in the European Union and the United Kingdom, where authorities have separately indicated they may step in.
Paramount and Warner previously said they hoped to close their deal sometime in the third quarter of this year, signaling recently an effort to complete process in the coming weeks. The clock is ticking. Paramount pledged to give shareholders some compensation if the acquisition doesn’t close by Sept. 30 – in the form of a 25-cent per share “ticking fee” for every quarter past that date. It’s also agreed to a regulatory termination fee of $7 billion.
Including debt, Paramount’s proposed purchase of Warner is valued at nearly $111 billion (or $31 per share) based on current outstanding shares.
Warner and Paramount argue that merging will be good for growth in the industry and give consumers access to more content, particularly if HBO Max and Paramount+ libraries are combined. But critics have decried what further consolidation could mean in an industry already controlled by just a few major players.
Thousands of actors, directors, writers and other industry professionals have voiced “unequivocal opposition” to the Paramount deal, arguing that further consolidation will lead to job losses and fewer choices for filmmakers and movie goers. Many lawmakers have similarly sounded the alarm.
Democrats have expressed skepticism about whether regulators working under President Donald Trump would scrutinize the deal as heavily, with questions of political influence piling up.
The Justice Department maintained that politics would not play a role in the regulatory process – but Trump himself has publicly waded into Warner’s future at times, despite backpedaling on what he once suggested his personal role would be. The Republican president also has a close relationship with the Ellison family, particularly Oracle founder Larry Ellison, who is putting billions of dollars on the table to back the bid for his son’s company.
Many eyes are on CNN, a network that has long attracted ire from Trump and his allies. Paramount’s CBS has already seen significant turmoil and shifts in editorial leadership since coming under Skydance ownership last – and if Warner merger goes through, the reach of that could grow. Several Trump administration officials have been far from shy from sharing their hopes for CNN under Paramount ownership, with Defense Secretary Pete Hegseth telling reporters in March that “the sooner David Ellison takes over that network, the better.”
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