California Atty. Gen. Rob Bonta and 11 other state attorneys general expressed concern that the industry-reshaping deal could spell doom for movie theaters.
California Atty. Gen. Rob Bonta and eleven other Democrat state attorneys general filed a lawsuit Monday to block Paramount Skydance’s proposed $111-billion takeover of Warner Bros.
Discovery — a last-ditch effort to derail a deal that would transform Hollywood. Tech scion David Ellison’s proposed merger has been hurtling toward the finish line after securing approvals from the U.S. Justice Department and numerous foreign governments. President Trump, an ally of Ellison’s billionaire father Larry Ellison, favors the deal.
He is eager for aThe antitrust suit, filed in federal court in San Francisco, alleges that the proposed merger would violate the U.S. Clayton Act, a century-old antitrust law to prevent mergers that weaken competition and increase costs for consumers.
“Consolidation here not only leads to higher prices — it also leads to fewer opportunities for important stories to come to life, and fewer ways for audiences to encounter stories, ideas, and perspectives beyond their own experiences,” Bonta said in a statement. California and the 11 other Democrat attorney generals, including New York, New Jersey, Washington and Colorado, allege the merger would devastate the theatrical film business by combining two historic film studio rivals.
The Ellison family would control such storied franchises as Harry Potter, Bugs Bunny, Batman, “Top Gun” and “Game of Thrones. ” The states have asked Paramount to delay the closing of its Warner Bros. takeover until the litigation can be resolved.
If Paramount refuses, Bonta said the coalition would seek a temporary restraining order asking a judge to hold up the merger, which could cause costly delays and escalate legal expenses for Paramount in their quest to finalize the deal.in less than a year. The Ellison family acquired control of CBS-owner Paramount in August and, at the time, David Ellison touted the move of Paramount’s headquarters from New York’s Times Square to Hollywood.
If the merger goes through, Paramount would own four streaming services, including Warner’s HBO Max and the dominant U.S. cable TV channel owner with HBO, TBS, HGTV, Animal Planet, and Food Network, Comedy Central and Nickelodeon. , saying the combination would likely bolster competition — not harm it.
The agency’s decision had been expected because of Larry Ellison’s In a show of confidence earlier this year, the Ellisons agreed to increase the payout to Warner investors should the regulatory approval process drag on. Those extra 25-cent-per-share payments begin with the October-December quarter, and would add more than $650 million in deal costs each quarter — giving David Ellison an increased incentive to quickly close the deal. California attorney general vows to scrutinize Paramount’s deal for Warner Bros.
DiscoveryThe new colossus would significantly dampen competition, Bonta and the other Democrat prosecutors argue. They pointed to the wide-release movie film distribution business, where Warner Bros. and Paramount control about 27% of the market. After the merger just four companies — Paramount-Warner, Disney, NBCUniversal and Sony Pictures — would control 86% of the films that were widely released, Bonta said.
Another concern is the licensing of basic cable TV channels, including CNN and HGTV, to pay-TV providers such as Charter’s Spectrum, DirecTV and Google’s YouTube TV. Warner Bros. is the second largest cable channel owner and Paramount is the third largest. Together their channels would represent about 27% of the market. Justice Dept. approves Paramount’s acquisition of Warner Bros.recently shed its movie theater chainCalifornia Atty.
Gen. Rob Bonta is leading an effort by state attorneys general to block Paramount’s proposed takeover of Warner Bros. Discovery.she was weighing whether to intervene in the deal due to concerns about maintaining a competitive media market. Britain’s Competition and Markets Authority also has opened an investigation into Paramount’s proposed merger.
In April, a federal judge in Sacramento granted a request from Bonta and seven other attorneys general for a preliminary injunction, which freezes the merger of Nexstar Media Group, which owns KTLA-TV Channel 5, and Tegna. The deal was designed to create the nation’s largest TV outlet group . A larger group of state attorneys general also won a New York jury verdict against Live Nation Entertainment and its subsidiary Ticketmaster.
Jurors found that Live Nation had illegally monopolized the live concert industry. Ellison’s close ties to President Trump, and widespread concerns about the future of Hollywood, drive anxiety over the tech scion’s $111-billion deal for Warner Bros. Discovery. The tech giants, which introduced consumer-friendly streaming options, have lessened the influence of traditional companies like Paramount and Warner Bros.
Meg James is a senior entertainment industry writer for the Los Angeles Times. She was the lead reporter for The Times’ coverage of the deadly “Rust” shooting on a New Mexico film set in 2021, work recognized by the Pulitzer Prize board as a finalist in breaking news. A member of the Company Town team for two decades, James specializes in covering television, corporate media and investigative projects. She previously wrote for the Miami Herald and the Palm Beach Post.
A native of Wyoming, she is a graduate of the University of Colorado and Columbia University.
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