Attorneys general from 12 states have filed a lawsuit against Paramount Skydance to stop its $110 billion merger agreement with Warner Bros. Discovery. The suit, filed in the US District Court for the Northern District of California, cites concerns about a monopoly and reduced competition across the film and cable industries and among audiences in general. The deal cleared hurdles with the US Department of Justice in June, with the agency stating that the merger would likely not cause harm or “raise actionable antitrust concerns.”
California’s attorney general, Rob Bonta, is leading the effort with counterparts from New York, New Jersey, Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Mexico, Oregon and Washington. The group of attorneys general is asking Paramount to halt the process until after litigation, or they will plan to file a temporary restraining order. According to the group, Warner Bros. Discovery and Paramount would control 27% of the market share in the theatrical distribution space, and 27% of cable and satellite channel distribution if the deal goes through.
“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.
The media deal, described as the largest of its kind in Hollywood history, is expected to combine Paramount and WBD’s streaming businesses into a single platform. Consolidation among its studio lots, film and TV businesses and cable networks is also expected to lead to major corporate restructuring within both companies. The European Union is still vetting the transaction and is set to issue an approval or denial this month.
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