Just a few days ago, states’ antitrust claims against the Paramount-Warner Bros. merger still appeared to be a speed bump.
Paramount has agreed to put its $111 billion contract on hold for at least several months, so it’s now a siege-like situation. In doing so, Paramount’s lawyers effectively acknowledged that they have no hope of winning any future fights over the injunction and will instead aim to defeat the states in court.
“I think they saw the writing on the wall,” California Attorney General Rob Bonta told Variety on Friday. “They saw the outcome of the preliminary injunction motion as a fait accompli. The die was cast. They would lose. Otherwise, why not challenge it?”
Paramount Skydance Chairman and CEO David Ellison had hoped to win a judgment denying the injunction by mid-September and complete the deal in time to avoid paying Warner Bros. shareholders millions of dollars a day. His lawyers have asked for a three-day evidentiary hearing in late August to confront the state’s expert economists and potentially undermine the state’s claims that the deal creates illegal market concentration.
However, in Thursday’s ruling, Judge Araceli Martinez-Holguín rejected Paramount’s bid to expedite the briefing on the request, indicating that it was not willing to go through a multi-day hearing. A judge has already granted a 28-day injunction, finding that the states have shown a “strong indication” that the merger is likely to harm competition, and the standard for an injunction will likely be similar.
Paramount could have waited for the ruling and then immediately appealed to the Ninth Circuit. But Nexstar’s attempt to do so after its merger with Tegna was barred in April remains stalled, with no guarantee of a quick resolution. Paramount is facing similar delays, with appellate relief likely to be pushed back to early 2027.
So where do we go from here?
Paramount enters the case believing it still has the upper hand against what it calls “one of the weakest merger challenges in modern antitrust history.” The company hopes to reach its goal as soon as possible, ideally by the end of 2026.
Every time a trial is held, it doesn’t start early enough to require Warner Bros. Discovery shareholders to pay $7 million a day starting September 30th. But that’s the cost Paramount would have to incur to get the deal done.
The 12-state coalition argues that more time is needed to prepare and is pushing for the event to be held at a later date.
“We think 2027 is appropriate,” Bonta said. “If the judge said April 2027, we would not agree to that.”
Paramount has agreed not to complete the transaction until five days after the court’s decision or June 1, 2027, whichever comes first. Bonta argued that Paramount’s desire for a quick resolution was due to “business factors” and not due process considerations.
“I’m sure they want a speedy trial,” he said. “This is based on other reasons and is not appropriate for an incident of this magnitude.”
States will seek additional time to obtain extensive evidence, including documents and depositions that were not available during the investigation.
“Paramount and Warner Bros. were holding us back. They weren’t giving us everything we wanted,” Bonta said. “If they wanted to go to trial sooner, they could have provided us with the information we were seeking during the pre-litigation discovery process.”
The trial will take place in Martinez-Holguin’s courtroom in Oakland, California, and could last two to three weeks or more.
In the meantime, Paramount may seek to resume settlement negotiations with the states. Bonta said the company has so far not proposed any structural relief, such as the sale of cable or movie distribution assets, that would be required as part of the deal.
Bonta has repeatedly said he is not interested in “behavioral” remedies such as consent decrees that guarantee a minimum number of movie releases or a 45-day theatrical window, saying they have proven ineffective in the past.
“We haven’t gotten anything that comes close to addressing the concerns we’ve raised,” Bonta said. “We are focused on litigation. We are building momentum and look forward to carrying that momentum to trial.”
Paramount said in a statement that a strategic withdrawal is the best way to make a decision on the deal as quickly as possible.
“This is the fastest and clearest way to prove that this deal is good for competition, good for consumers and good for creators, a conclusion that dozens of competition authorities around the world have already reached,” the company said.
Bonta argued the opposite. And now it is clear that these arguments are more than a small obstacle.
“If this merger were to go through, it would hurt Americans and Californians,” he said. “Prices are going to go up. It shouldn’t cost a fortune to enjoy your favorite show on the couch.”
