California Attorney General Rob Bonta canceled a scheduled meeting with Paramount on Monday to discuss a potential settlement in the state's antitrust lawsuit aimed at blocking Paramount's $110 billion takeover of Warner Bros. Discovery. Bonta accused Paramount of "playing games" and leaking information discussed in preliminary settlement talks, demonstrating a "lack of good faith."
The meeting was intended to address the lawsuit filed by California and 11 other Democratic state attorneys general, along with the Writers Guild of America, to halt the merger. These groups argue that the deal would violate antitrust laws, harm competition in Hollywood by squeezing out rivals, and threaten economic competition in markets such as wide-release theatrical films, top-grossing movies, and basic cable television distribution. Paramount, however, maintains that the merger will boost economic competition and production output in film and television.
Reports, including one from the Wall Street Journal, suggested that Bonta was preparing to demand the sale of some basic cable TV channels, as the combined entity would control over 50, including CNN, Comedy Central, Cartoon Network, HGTV, and MTV. The proposed combined company, led by David Ellison, son of Oracle mogul Larry Ellison, would encompass two movie studios, two streaming platforms, various cable channels, and two major news organizations: CBS News and CNN. Ellison reportedly threatened to move Paramount out of California if settlement talks were not initiated.
The antitrust trial is currently scheduled for March. Under the merger agreement, if the deal has not closed by October 1, Paramount will be obligated to pay Warner Bros. Discovery shareholders approximately $7 million per day in "ticking fees," amounting to roughly $650 million per quarter. The merger has been frozen until either the antitrust challenge is resolved or June 1, 2027, whichever comes first.
