California AG Leads Opposition to Major Merger
California’s Democratic Attorney General Rob Bonta is spearheading a coalition of 12 states against the merger between Warner Bros. Discovery Inc. and Paramount Skydance, a deal recently endorsed by the Trump administration, valued at $110 billion.
The merger was officially announced on February 27, with the Department of Justice granting federal approval on June 12. This approval was part of the overall regulatory process involving then-President Donald Trump.
Bonta, along with his colleagues from other states, voiced strong objections to this merger. Their coalition argues that it poses significant risks to both movie theaters and basic cable providers, potentially impacting viewers nationwide. If finalized, the merger would place Paramount in control of around 27% of the U.S. movie distribution market and a similar percentage of basic cable channels.
Bonta stated, “This illegal merger of entertainment giants will likely result in higher prices, diminished quality, and reduced content for movies and television, adversely affecting theaters and audiences across America.” He further stressed the importance of California’s film industry in the lives of many, calling it a source of pride and employment and warning against the negative outcomes of such consolidation.
“This not only leads to inflated prices but also limits opportunities for diverse storytelling that goes beyond common experiences,” he added.
On the other hand, Paramount defends the merger by claiming it will eliminate $6 billion in overlapping costs and boost content production. CEO David Ellison has promised a schedule of 30 film releases annually from both companies.
However, to ensure the deal doesn’t move forward until the legal challenges are resolved, the involved parties have agreed to pause the transaction. If necessary, the coalition will seek a temporary restraining order to block the merger.
Paramount has a storied legacy with notable franchises, while Warner Bros. has left its mark on American media through various influential shows and events. The lawsuit, filed in the U.S. District Court for the Northern District of California, argues that the merger would violate Section 7 of the Clayton Act by threatening competition and enabling monopolies.
Bonta is joined by attorneys general from Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington in this lawsuit.
