SAN FRANCISCO – A coalition of 12 states moved Monday to block Paramount’s planned acquisition of Warner Bros. Discovery, arguing in a lawsuit that the $81 billion entertainment deal would “extinguish competition” in Hollywood and put industry jobs at risk.
California Attorney General Rob Bonta’s office, which is spearheading the legal challenge, said the states are urging Warner and Paramount to hold off on finalizing the merger “until after the judicial process concludes.” If the companies refuse, the group plans to 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.
Joining California in the lawsuit are Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington.
Paramount, now owned by Skydance, pushed back Monday, saying the lawsuit “distorts settled antitrust law.” The company argued the deal would help build a “stronger competitor against dominant streaming and technology platforms who have harmed the market for theatrical exhibition and jobs in the entertainment industry.”
Paramount said it would “vigorously defend” the proposed transaction. Warner Bros. Discovery referred questions to Paramount.
Where Paramount’s takeover of Warner stands
If completed, a Paramount-Warner combination would bring HBO Max, popular franchises such as “Harry Potter” and CNN into the same corporate portfolio as CBS, “Top Gun” and the Paramount+ streaming platform.
The states’ lawsuit could throw a wrench in those plans, at least for now. The antitrust case arrives at a pivotal time for the Paramount-Warner transaction — which, after months of what became a very public bidding war with Netflix, received shareholders’ stamp of approval in April and then a blessing from the Trump administration just last month.
The U.S. Justice Department isn’t challenging the deal — and instead released an unusually lengthy statement in support, maintaining a Paramount-Warner combo would “increase competition across the media and entertainment ecosystem, with benefits for American consumers and workers.”
Paramount has touted additional regulatory clearances it says it’s received in a handful of other countries, including China, Canada and Australia. But other reviews remain in progress, including in the European Union and the U.K. — which has separately suggested it may intervene.
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.
Critics of the deal, and Paramount’s response
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. Meanwhile, Paramount on Monday argued that delaying the merger “will only harm entertainment workers who have already suffered over recent years as technology has disrupted their livelihood and cost California tens of thousands of entertainment jobs.”
Questions of political influence have also piled up. Democrats in particular have expressed skepticism about whether regulators working under President Donald Trump would scrutinize the deal as heavily.
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.”
