Paramount has signaled that it will leave California. TMZ first broke the news, reporting that a press conference had been planned for today, though it never materialized.
Deadline has since corroborated the report, saying company leadership has told key officials, including L.A. Mayor Karen Bass and California AG Rob Bonta, about relocating its headquarters after more than a century in Hollywood — they have even put in a deposit with a moving truck company.
For months, people close to CEO David Ellison had hinted that he would leave if state AGs didn't drop their antitrust suit against the $111 billion Warner Bros. Discovery merger. Paramount, which most likely leaked the exit story, declined to comment, and Bonta's office didn't respond. If the exit does happen then California would stand to lose $21.2 BILLION loss in annual economic output. Up to 57,000 jobs across industries are expected to be lost.
The threat comes as the merger is stalled by the antitrust lawsuit filed by a dozen states and the Writers Guild of America. Court-ordered settlement talks are set for next month, and a hearing is scheduled for next week on Paramount's request that the plaintiffs post a $1.88 billion bond to cover its expected losses. The trial doesn't start until March 2, 2027, a wait Paramount apparently sees as too long. The losses Paramount cites stem mainly from a $7 million-a-day ticking fee in the WBD contract that kicks in October 1.
This latest update comes a month after Paramount's board approved relocating the company's headquarters and eventually shifting many studio jobs elsewhere. The proposed move would be driven largely by economics. Ellison estimates that leaving California could save about $500M a year in taxes, while selling the Paramount lots could bring in billions more. He is eyeing Tennessee, Texas, or Georgia.
California has already watched several major corporations, including Chevron, Oracle, and Tesla, move their headquarters out of state in recent years amid disputes with regulators. The last thing the state needs is for a major Hollywood studio to follow.
I don't believe the threat is just a negotiating tactic aimed at pressuring Bonta. If you're familiar with the Ellisons' history, you know it's entirely credible, and the message is unmistakable. Ellison's reasoning is simple: if he has to pay billions in ticking fees because the state is suing him, then leaving California and selling the lots will let him recoup that money and pay far less in taxes.
Earlier today, we got our first look at Joseph Kosinski's "Miami Vice '85," which is now filming. The cast is sprawling, and we can add yet another talented actor to the mix.