OAKLAND, United States – A US judge has temporarily halted Paramount Skydance’s proposed $110 billion acquisition of Warner Bros. Discovery after state attorneys general raised antitrust concerns over the deal.
California District Judge Araceli Martínez-Olguín issued a 14-day restraining order on Monday, preventing the merger from moving forward while the court considers the legal challenge. Okay News reports that the lawsuit was led by California Attorney General Rob Bonta and joined by 11 other states.
The proposed transaction would bring Paramount and Warner Bros. film studios, CBS, CNN, TNT, MTV, BET, Paramount+ and HBO Max under one company. The states argue that the combined business would control nearly one-third of theatrical films and basic cable programming in the US.
In her ruling, Martínez-Olguín said the coalition had presented “compelling evidence” that the merged company would hold a substantial share of the wide-release theatrical distribution market.
Paramount has rejected the allegations, describing the merger as lawful and pro-competitive. The company said the states’ market definitions and claims of anti-competitive effects were not supported by current industry realities.
The legal action was filed under the Clayton Antitrust Act, a US law that prohibits anti-competitive mergers and acquisitions. Paramount had indicated that it could close the deal as early as July 22 after receiving regulatory approvals.
The company previously offered to delay the closing until mid-August to avoid a temporary restraining order. The states, however, may seek another order after the 14-day period or apply for a preliminary injunction that could further delay the transaction.
The merger has received approval from the US Justice Department and several international jurisdictions but remains under review by the European Union and the United Kingdom. Paramount says it remains on track to complete the deal by the end of September.
Further delays could expose Paramount to additional costs, including a quarterly ticking fee of 25 cents per Warner Bros. Discovery share after September 30 and a potential $7 billion breakup fee if the transaction fails because of regulatory concerns.
