Just yesterday, someone in Paramount CEO David Ellison’s camp leaked to Semafor that the studio is considering relocating the company’s headquarters out of California and redirecting much of its planned $30 billion in annual spending if the state ultimately sued to block the deal.
Well, they’re still suing.
A coalition of 12 states has filed an antitrust lawsuit seeking to block the proposed $111 billion merger between Paramount/Skydance and Warner Bros. The deal was approved by the Department of Justice last month.
The coalition includes attorneys general from Arizona, California, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington.
Led by California AG Rob Bonta, the states argue that the merger would violate the Clayton Act by reducing competition across theatrical distribution, blockbuster film releases, and basic cable licensing markets.
The lawsuit claims the combined company would control significant portions of the entertainment industry, including 27% of the wide-release theatrical distribution market, 30% of the market for anticipated blockbuster films, and 27% of the basic cable bundle. The states argue that merging two of Hollywood’s five major legacy studios would lead to higher prices, fewer films, reduced consumer choice, and less competition.
Paramount has defended the merger, arguing that the combined company would be better positioned to compete with streaming giants such as Netflix, Amazon, and Disney while continuing to invest in film and television production. CEO Ellison has pledged that the company would release at least 30 films annually, while Paramount’s legal team has argued that the deal would create more jobs and expand opportunities for creators.
The challenge comes despite the DOJ’s approval of the transaction, with the agency concluding that the merger would not significantly harm competition in theatrical, streaming, or traditional television markets. The states, however, are now seeking an injunction to stop the deal from closing, with Paramount targeting a completion date after July 22.