merger

British regulators on Thursday cleared tech scion David Ellison’s $111-billion deal to buy Warner Bros. Discovery — the latest international agency to find the blockbuster combination of TV channels and historic film studios wouldn’t dampen competition.

Britain’s Competition and Markets Authority and the government’s culture minister separately reviewed Paramount Skydance’s proposed Warner acquisition, which is facing significant turbulence in the U.S. as California Atty. Gen. Rob Bonta leads a coalition of state attorneys general who are battling to try to unravel the mammoth deal.

“The evidence shows that, after the merger, Paramount will continue to face sufficient competition in the various areas it operates in, including the production and distribution of films and TV content, the supply of children’s channels to pay-TV providers and the supply of streaming services,” the authority said in a statement.

Earlier this summer, Secretary of State for Digital, Culture, Media and Sport Lisa Nandy said she was weighing whether to intervene by launching an in-depth investigation into potential harms that could result from the proposed Paramount-Warner Bros. combination.

Nandy opted not to issue an “intervention notice” after striking an agreement with Paramount that provides “assurances and legally-binding commitments” that the company would not abuse its market clout.

The authority’s approval was significant because Paramount owns CBS News, children’s channel Nickelodeon and Channel 5, one of the largest over-the-air television broadcasters in the United Kingdom.

Warner Bros. Discovery owns HBO, CNN, Cartoon Network and TNT Sports, which broadcasts the Olympics, Champions League and Premier League soccer matches.

Ellison and his team now have won clearances from 66 antitrust regulators, including the U.S. Department of Justice, and regulators in Australia, Germany, France, Italy, China and Canada, among others. The European Commission also approved the deal last month.

“These clearances recognize that the combination of Paramount and WBD will enhance consumer choice and enable a creative-first company to invest in more projects and bring stories to audiences worldwide,” Paramount said in a statement.

Still, the deal is stalled in the U.S.

Bonta and his fellow Democrat state attorneys general have won early victories in their court battle, and a federal judge this week scheduled a March trial — months later than Paramount had hoped — to determine whether the merger would violate the century-old U.S. Clayton Antitrust Act.

Paramount is facing a June 4 deadline to finalize the deal or pay Warner a $7-billion break-up fee.

Bonta and the 11 other state attorneys general, including from New York, Colorado and Oregon, have alleged the merger of two major film studios would give Paramount-Warner Bros. more than 25% of the wide-release theatrical film market. Their lawsuit contends the combined company would own too many cable TV channels — more than 50, including CNN, TBS, HGTV and Comedy Central.

The Writers Guild of America has separately sued to block the transaction, claiming the combination of two historic studios would reduce opportunities and pay for writers.

Ellison, in a guest essay this week, blamed politics for the U.S. friction. “The issue is whether I can be trusted as a steward of Warner’s CNN,” Ellison wrote in his op-ed in the New York Times.

Bonta, in a recent interview with The Times, denied his lawsuit was motivated by politics, saying it was a “meat-and-potatoes” antitrust case.

More than 5,000 entertainment industry workers, including such high-profile stars as Jane Fonda, Ben Stiller, Bryan Cranston and Mark Ruffalo, signed an open letter early this year, calling on Bonta to thwart the merger. The group alleged the transaction would weaken Hollywood with “fewer opportunities for creators, fewer jobs across the production ecosystem, higher costs, and less choice for audiences.”

Britain’s competition authority found the combined company would still encounter competition from Universal Pictures, Disney and Sony Pictures Entertainment and “a range of other smaller studios.”

In addition, the CMA factored in the competition brought by streaming services to traditional forms of movie and TV distribution — one of Paramount’s key arguments.

“Paramount is grateful to the CMA for its constructive engagement and its review of the transaction,” Paramount said in its statement. “These conclusions further demonstrate the misguided and gerrymandered market definitions relied upon by the US state AGs in their antitrust complaint in California.”

“Spider-Man: Brand New Day” opened to $360 million in the U.S. and Canada this weekend, pushing out 2019’s “Avengers: Endgame” to claim the biggest domestic debut in history.

“Records are made to be broken,” Sony Motion Picture Group Chairman Tom Rothman said in a statement Monday. “But we will take great pride in this one, for as long as we hold it.”

Internationally, the web-slinger picked up an additional $572 million for a worldwide total of $932 million. The film, which stars Tom Holland and Zendaya, was produced by Sony-owned Columbia Pictures, Marvel Studios and Pascal Pictures on a production budget of about $225 million.

By Monday morning, nearly everyone in the exhibition business was cheering.

The chief executives of AMC Entertainment Holdings, Regal and Cinemark Holdings all put out statements about record revenue at their chains, plus deep demand for merchandise, food and drinks. Cinema United trade group chief executive Michael O’Leary applauded the “great slate of films” that have populated theaters this year.

There’s a lot to be excited about here. Expectations for the film were high, but breaking a pre-pandemic record — previously held by an “Avengers” movie, no less — is a big deal.

“The buildup to what ‘Endgame’ was at $357 million just seemed out of reach,” Jeff Bock, senior box office analyst at entertainment data firm Exhibitor Relations, told me on Monday, referring to the previous domestic debut record. “It’s pretty gratifying to see that characters and emotions still matter in filmmaking. This movie was just really about relationships.”

That emotional core was a major focus for the filmmakers. When I spoke with producer Amy Pascal in the lead-up to the opening, she said there was no topping the multiverse storyline of 2021‘s “Spider-Man: No Way Home,” which featured the return of Tobey Maguire and Andrew Garfield. Instead, the filmmakers chose to go smaller, focusing on the internal conflict and loneliness of Holland’s Peter Parker after a spell forces his friends to forget him.

Spider-Man has always been one of the most popular superheroes. But not every Spidey film has had this level of box office success. What “Brand New Day” shows is that a strong story matters more to audiences than the name of the superhero alone — an important distinction as the genre has weathered an uneven track record in recent years. Just this summer, we saw stumbles from Amazon MGM Studios’ “Masters of the Universe” and Warner Bros. Pictures and DC Studios’ “Supergirl.”

The next test arrives in December with Walt Disney Co. and Marvel Studios’ “Avengers: Doomsday,” which “Brand New Day” teases in a post-credits scene, as well as throughout the film. “As audiences saw, it sets up exciting things to come,” Marvel Studios President and “Spider-Man” producer Kevin Feige said in a Sunday statement.

The recovery, by the numbers

Domestic box office revenue for the weekend totaled $436.5 million, according to data from Rentrak. Spider-Man accounted for 82% of it, but Christopher Nolan’s “The Odyssey” also hauled in $51 million in its third weekend, on its way to worldwide revenue of more than $912 million.

Together, the pair have combined for a unique, and telling, one-two punch. It’s the same phenomenon that drove moviegoers to A24’s “Backrooms” and Focus Features’ “Obsession.” Originality in storytelling really does matter, despite the plethora of reboots and sequels. And when moviegoers have more choices, they’re coming back, again and again, analysts say.

“These two films in particular have really turned moviegoing itself into the event,” Bock said. “The audience isn’t rejecting theatrical movies. They’re rejecting films that don’t feel essential.”

Domestic summer box office revenue to date now stands at nearly $3.6 billion, up 16.7% compared to 2025 and — importantly — only 0.7% behind the same period in 2019. Year-to-date revenue is about $6.2 billion, a 15.4% improvement from last year, though it still lags 2019 by 11.6%.

And with another blockbuster to come in December — Warner Bros. and Legendary Entertainment’s “Dune: Part Three” — analysts now predict 2026 domestic revenue is on track to reach $10 billion, a milestone that hasn’t happened since before the pandemic.

What could undo it

Here’s the catch. A major part of that recovery rests on volume: more titles, more genres, more reasons to leave the house on a given weekend. Which is exactly what a federal judge in Oakland is weighing right now.

Paramount Skydance’s nearly $111-billion acquisition of Warner Bros. Discovery has cleared the Justice Department, the European Commission and regulators in more than a dozen other countries. What it has not cleared is a coalition of 12 state attorneys general, led by California’s Rob Bonta, who sued July 13 to block the deal under the Clayton Antitrust Act.

On Friday, the parties each proposed their preferred dates for an antitrust trial over which U.S. District Judge Araceli Martínez-Olguín will preside as Paramount argues for its merger to proceed and the state attorneys general argue against it. The judge has said the states had presented compelling evidence the combined company would hold a substantial share of the wide-release theatrical distribution market — enough, she said, to presume the deal likely violates antitrust law. The Writers Guild of America has joined the states’ lawsuit.

Paramount has said the merger will benefit consumers, workers and the entertainment industry, and that the states’ claims of anticompetitive effects “are without any basis in modern market realities.”

Hollywood has seen this movie before. The last unaccounted-for variable from the pre-pandemic era is Disney’s 2019 acquisition of the entertainment assets of 21st Century Fox, which combined two studios and led to fewer theatrical releases.

Paramount Skydance chief executive David Ellison has promised the combined company will release a minimum of 30 films a year. Many in Hollywood have their doubts.

“If they’re able to execute on that promise of 30 titles a year, I think we’re going to accelerate even further,” said Daniel Loria, a senior vice president at The Box Office Co. “We’re on a great trajectory. But there are serious questions that remain on their capacity to do so, and what the impact of another slowdown in releases from a major studio would bring.”

Paramount has said it won’t close the deal before June 2027 unless the litigation resolves sooner, and is pushing for a November trial; the states want April 2027. Either way, the industry just posted its biggest opening weekend ever while the question of how many movies get made is sitting in a courtroom in Northern California.

Stuff We Wrote

Film shoots

Number of the week

The Hollywood Foreign Press Assn. has sued Jay Penske, Penske Media Corp., the Golden Globe Foundation and others over the 2023 acquisition of the Golden Globe Awards, alleging antitrust violations.

As my colleague Stacy Perman reported, the Hollywood Foreign Press Assn. is seeking at least $150 million in damages.

The group, which founded the Golden Globes, said in its lawsuit that Penske and the other named defendants “orchestrated and participated in a clandestine scheme to fraudulently acquire the Golden Globe Awards, dismantle the HFPA [Hollywood Foreign Press Assn.], and exert monopolistic control over Hollywood trades and the awards circuit thereby violating California’s antitrust and consumer protection statutes.”

A spokesperson for Penske and the Golden Globes denied the allegations, saying the suit “continues the absurdity and irrationality that the industry has come to expect from the defunct organization formerly known as the HFPA.”

What I’m watching

I had a pretty hectic week, which didn’t leave a lot of time to catch up on TV. But I did go see the L.A. Sparks game against the New York Liberty, which unfortunately ended in a loss. We’ll see what happens now that star Kelsey Plum has been traded.

Paramount Chairman David Ellison believes the tug-of-war over his proposed $111-billion purchase of Warner Bros. Discovery comes down to a single question: whether he can be trusted to control CNN.

“I believe this fight is not really about market share,” Ellison wrote in a Tuesday op-ed in the New York Times, noting that regulators around the world, including the U.S. Justice Department, have approved the deal that has been temporarily blocked by an antitrust lawsuit brought by California Atty. Gen. Rob Bonta and his coalition of Democrat state attorneys general.

“I believe a plainer worry sits beneath the briefs and the news releases … The issue is whether I can be trusted as a steward of Warner’s CNN,” Ellison wrote.

The rare opinion piece serves as Ellison’s acknowledgment that his family’s close association with President Trump has sullied his standing in Hollywood and beyond.

Shakeups at CBS News, which is part of Paramount, the departure of CBS late night host Stephen Colbert, and a visible presidential lobbying effort — including hosting a dinner for Trump in Washington in late April and attending Trump’s birthday extravaganza in June with UFC fights on the White House lawn — have come with a cost.

More than 5,000 entertainment industry workers, including such high-profile stars as Jane Fonda, Ben Stiller, Bryan Cranston and Mark Ruffalo, signed an open letter early this year, calling on Bonta to try to block the merger.

Bonta and the other state attorneys general sued, saying the merger of two of the major film studios would give Paramount-Warner Bros. more than 25% of the wide-release theatrical film market. Their lawsuit also alleged the combined company would own too many cable TV channels — more than 50, including CNN, TBS, HGTV and Comedy Central.

Many in Hollywood fear that the consolidation of two historic studios will bring thousands of layoffs and contribute to a bleaker employment picture. Ellison’s Skydance Media’s takeover of Paramount a year ago resulted in the loss of 2,000 jobs.

Some have opposed the Warner Bros. deal, saying one family shouldn’t be allowed to control two significant news operations: CBS News and CNN, which is owned by Warner Bros. Discovery.

“There has been speculation about my politics, my loyalties, my intentions,” Ellison wrote.

“Unfortunately, I can’t give anyone a view into my heart and mind, but I can share this: I have regularly voted for candidates of both parties; I hold some views that would be called conservative and others that would be called liberal, just like most Americans,” Ellison said. “And when it comes to our news operations, I do not aspire to lead these companies to bend their newsrooms to my views. I believe that news should be based on facts and truth.”

“Great news organizations like CNN and CBS News are here to tell it straight down the middle,” he said. “That requires newsrooms that reflect the whole world, not one side of it. And it requires independence. Our journalists will continue to answer to the facts and to all the people they serve — not to any party or cause.”

“These were founding principles for both CNN and CBS News, for legends like Ted Turner and Edward R. Murrow, and it is exactly that kind of independence that has always fueled the greatness of “60 Minutes,” Ellison wrote.

Fired “60 Minutes” correspondents, including Cecilia Vega, have complained that since Bari Weiss became editor-in-chief of CBS News last fall, journalists have been asked to tilt the presentation of controversial news events, including protests to Immigration and Customs Enforcement actions earlier this year in Minnesota, which led to the deaths of two Americans.

Paramount has pushed back saying the plaintiff states have defined markets that fail to factor in the rise of technology companies, including Netflix, Google’s YouTube and Amazon Studios, which also attract significant swaths of viewership.

The Writers Guild of America has separately sued to block the merger, saying the deal would lead to less opportunities and lower pay for writers struggling to stay in the industry.

U.S. District Judge Araceli Martínez-Olguín, who is overseeing the high-profile case, issued a temporary restraining order to block the merger from finalizing while the two sides hash out the evidence. Late last month, Paramount agreed to delay the merger until after a trial — or until June 1, whichever date comes first.

In court documents filed Friday, Bonta and his coalition of 11 other Democratic attorneys general proposed having a two- to three-week trial in April to weigh the evidence.

Ellison’s Paramount pushed back, saying the media company would like to start the courtroom action on Nov. 4.

Now the judge must schedule the court date.

“The states claim this deal will give one company too much influence over theatrical releases and cable operators, while the W.G.A. argues that our combined market power will hurt writers,” Ellison said in the opinion piece. “Both suits imagine a Hollywood that no longer exists — an industry ruled by a handful of legacy studios.”

Paramount Skydance Chief Executive David Ellison isn’t waving a white flag.

After Paramount agreed Friday to delay its proposed merger with Warner Bros. Discovery to battle a stiffer-than-anticipated antitrust challenge from California Atty. Gen. Rob Bonta and 11 other state attorneys general, Ellison is resetting expectations. In a Monday memo to employees, Ellison wrote that he still believes his mammoth merger will be consummated in the coming months.

Paramount stock has lost about 20% of its value since the beginning of July amid concerns that the company will have to shoulder higher costs to get its $111-billion Warner Bros. acquisition across the finish line. Friday’s agreement with the state attorneys general to delay the merger’s close until after an antitrust trial, which will likely be held in 2027, also was unsettling to shareholders and some employees.

Paramount Skydance shares closed at $8.03, down 2.19% Monday afternoon.

“Let me be clear: we remain highly confident that this transaction does not pose any legal issues, and we will complete it and bring these two companies together,” Ellison wrote in the memo shared with media outlets.

Paramount’s internal teams and Warner Bros. have been diligently working to lay the groundwork for the two rival companies to integrate their operations. The rush had been on because Ellison wanted to close the deal this week — or at least by the end of September — to avoid a higher payout to Warner shareholders.

However, Paramount suspended such ambitions on Friday, agreeing to delay the merger until after a trial to litigate the merits of the antitrust case brought by Bonta and the other Democrats. Oregon, Washington, Colorado, Nevada, New Mexico, New Jersey and New York are among the states joining California in the fight.

The Writers Guild of America separately sued this month, alleging the merger would harm writers. Over the weekend, SAG-AFTRA announced that it supports the state attorneys general as they try to beat back the merger.

“Our members have every right to expect that the government will do thorough regulatory oversight when a deal of this magnitude takes place,” SAG-AFTRA President Sean Astin said in a statement.

“The workers in this industry should not have to rely on promises and aspirational statements,” he added. “This isn’t a conversation about shareholder value, it’s about the survival of the entertainment business in America.”

Teamsters already have spoken out against the deal.

Bonta and fellow attorneys general from Democrat-led states have argued the deal would violate the century-old Clayton Antitrust Act in three markets: wide-release theatrical films, potential blockbuster movies and cable television channel concentration.

U.S. District Judge Araceli Martínez-Olguín, who is overseeing the antitrust suit filed by Bonta two weeks ago, wrote in an order last week that the plaintiff states had presented “compelling evidence” that the proposed merger may violate U.S. antitrust law.

California Atty. Gen. Rob Bonta is leading an effort of 12 state attorneys general attempting to block Paramount Skydance’s $111-billion takeover of Warner Bros. Discovery.

(Genaro Molina / Los Angeles Times)

Paramount disputes that. The firm, controlled by the Larry Ellison family, has pointed to regulatory approvals it has already garnered, including from the U.S. Department of Justice, which found its acquisition of Warner Bros. Discovery would not harm competition.

The deal also won clearances from regulators representing 65 jurisdictions, including Australia, China, the European Commission, Germany, France, Spain and Canada. Paramount has pointed to those approvals as proof that the law is on its side.

In his memo, Ellison said delaying the deal until after a trial before Martínez-Olguín made sense.

“We believe this is the right path because the facts and the law are on our side, and a full hearing will demonstrate why the plaintiffs’ arguments should not prevail,” Ellison wrote.

Tech scion David Ellison for months projected confidence that his blockbuster Hollywood merger was on a glide path to completion.

His media company Paramount Skydance’s pitch early this year was that its proposed $111-billion acquisition of rival Warner Bros. Discovery could easily clear regulatory hurdles — unlike Netflix’s competing bid.

Ellison has heavyweights in his corner: his billionaire father Larry Ellison, co-founder of software giant Oracle, is bankrolling the deal, and President Trump is eager for the Ellison family to own CNN and other Warner assets, including HBO and the Burbank film and TV studios behind “Batman,” Harry Potter, Wile E. Coyote, and “The Pitt.”

“We could technically close [the deal] tomorrow,” Ellison told business new channel CNBC during a March interview. “There is nothing in this transaction that trips anything that would create cause for concern.”

But Paramount made a dramatic retreat Friday after two weeks of legal setbacks. The firm had been aiming to close the deal by September but agreed to table its takeover — perhaps until next spring — to allow a fiercer than expected challenge from California Atty. General Rob Bonta and 11 other Democrat state attorneys general to advance to trial before an Oakland-based federal judge.

The state prosecutors allege Paramount’s proposed merger with Warner Bros. violates a century-old antitrust law by giving the combined company too much heft in theatrical movie distribution and cable television.

The delay could saddle Paramount, the smallest of the major media companies, with substantial legal fees and hundreds of millions of dollars in added deal costs. In February, Paramount offered Warner investors a sweetener, so-called “ticking fees,” to win the auction.

Those fees, which begin accruing in October, will cost Paramount an extra $7 million a day — until the purchase is finalized. And if Paramount fails to close the merger, it would owe Warner Bros. Discovery a $7-billion breakup fee.

“Anyone who thinks they know how this deal ends should think again,” Forrester Research analyst Mike Proulx said in a statement. “This deal may still close or it may not. … The path to either outcome just got longer, messier, and likely more expensive.”

Paramount now must strengthen its case for a high-stakes trial while fortifying Paramount’s existing businesses and holding together a coalition of financiers, which includes the royal families of Saudi Arabia, Abu Dhabi and Qatar which jointly agreed to contribute $24 billion for equity stakes in the combined company.

Paramount reversed course after U.S. District Judge Araceli Martínez-Olguín dealt the company a blow on Monday when she temporarily blocked Paramount from finalizing the acquisition until mid-August. Looming was a key Aug. 3 hearing for the judge to determine whether the moratorium should be extended.

Paramount was concerned the judge would block the deal for the foreseeable future.

“They saw the writing on the wall,” Bonta said in an interview.

Columbia Law School business professor Eric Talley added: “This doesn’t constitute Paramount Skydance coming out and waving a big white flag — but it is a small white flag of surrender.”

Paramount, in a statement, said heading straight to trial would prove advantageous.

“This is the fastest and clearest way to prove that this transaction is good for competition, good for consumers, and good for creators,” Paramount said. “We look forward to proving our case at trial.”

Last week, the Writers Guild of America separately filed a lawsuit seeking to stop the merger, alleging that writers would encounter less work and lower pay should Paramount buy Warner Bros.

Now the merger won’t close until after a resolution in the litigation or by June 1, 2027, whichever date comes first.

“This is what we’ve been asking for from the start,” Bonta said. “We just wanted the court to have sufficient time to review our case without the threat of the companies merging.”

Ellison, through a Paramount spokesperson, declined an interview request.

The delay brings a different set of challenges, Talley said, including pushing the date of the takeover until after November’s pivotal mid-term elections when control of Congress might change hands.

“That itself could be disruptive,” Talley said. “Suppose we get a flip of the House of Representatives or the Senate, then we may see testimony in Congress.”

Prominent Democrats, including Sens. Cory Booker (D-N.J.), Elizabeth Warren (D-Mass.) and Adam Schiff (D-Burbank) have expressed alarm over the potential consolidation, which would shrink the number of legacy film studios and bring CNN in addition to CBS News under Ellison control.

Attempts to get Ellison to testify in Congress have fallen short. The Paramount chief declined an invitation to appear before the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights in February, as well as a subsequent request from Booker to appear during an April spotlight hearing.

“To what extent was the rush to get the deal done related to the midterms, and what press coverage was going to look like in the upcoming election season?” Talley asked. “CNN is not a huge money-making asset but it is a prominent asset of Warner Brothers Discovery.”

On Friday night, Trump extolled his friendship with the Ellison family during the White House Correspondents Assn. dinner while also criticizing prominent CNN anchors.

David Ellison is “going to make, I think, fantastic changes and keep some of the great stuff going,” Trump said.

CBS News has been roiled since shortly after the Ellisons acquired Paramount in August, and installed Bari Weiss as editor in chief of CBS News. She has overseen a series of controversial moves, including shaking up the evening news and sacking several “60 Minutes” correspondents.

Paramount scored one victory: the European Commission gave its blessing for the merger to go forward in the European countries it represents. The company now has gained clearances from more than 60 jurisdictions, including from the U.S. Justice Department, which found the merger would likely boost competition — not harm it.

Now, Paramount’s biggest obstacle is winning the case against Bonta and the other state attorneys general.

The states plan to request a trial in 2027, after the two sides conduct months of discovery to prepare their cases.

“We want to take depositions of employees. We want to take depositions of customers and competitors in these marketplaces that are impacted [and] we want documents,” Bonta said.

“We want to depose their experts and probe and test their experts’ opinions,” he said. “That all takes time.”

Bonta and the other state attorneys sidestepped the political landscape in making their lawsuit arguments.

“This is just a straight-up meat-and-potatoes antitrust case,” Bonta said. “The main point here is that antitrust enforcement is important because monopolies that lessen competition hurt everyday people.

“Once we have a trial, we’re going to win,” Bonta said. “So we think and we hope there will never be a merger.”

Paramount Skydance has agreed to delay its purchase of Warner Bros. Discovery to as late as next June as David Ellison’s media company mounts its defense to the antitrust challenge brought by California Atty. Gen. Rob Bonta and his coalition of 11 other state attorneys general.

The major concession comes as Paramount was facing an Aug. 3 hearing to try to convince U.S. District Judge Araceli Martínez-Olguín that its proposed $111-billion deal — which would reshape Hollywood with the combination of two historic studios — would not violate U.S. antitrust laws.

The judge appeared to be leaning toward the arguments of the state attorneys general, who have alleged the proposed union of two big film studios and television networks including HBO, CBS, CNN, Comedy Central, Nickelodeon and TBS, runs afoul of the 112-year-old Clayton Antitrust Act.

In a stipulation filed Friday, Paramount agreed to hold off on closing its blockbuster purchase until after the states’ antitrust case can be decided in a trial before the Oakland-based judge or by June 1, 2027, whichever date comes first.

The move came after Martínez-Olguín issued a temporary restraining order earlier in the week — requested by Bonta and the others — which paused the deal until next month’s preliminary injunction hearing when she was set to decide whether a lengthy moratorium should be imposed.

Privately, Paramount officials were worried they might lose that round before Martínez-Olguín, so, during negotiations with the states, Paramount stipulated that it would not close the deal on its preferred timetable.

Paramount had wanted to finalize the takeover this month — or at least have it wrapped up by Sept. 30.

In a statement, Bonta celebrated the delay as “great news for audiences, movie theaters, and the many people who write, build, and create the art, news, and entertainment so many of us enjoy.”

“Our argument against this illegal merger is straightforward: When too few corporations have too much power in markets central to American life, it makes things more expensive, and it makes things worse,” Bonta said.

Now, Paramount will incur added deal costs and significant legal fees as it prepares the case for a full-blown trial. Paramount, in a statement, framed the delay as “a significant win” for the company.

“The result is exactly what we have sought from the outset: a direct path to a trial based on the evidence,” a Paramount spokesperson said in a statement. “This is the fastest and clearest way to prove that this transaction is good for competition, good for consumers, and good for creators, a conclusion dozens of competition authorities around the world have already reached. We look forward to proving our case at trial.”

On Wednesday, the European Commission gave its blessing, allowing the Paramount-Warner merger to move forward in European countries. More than 40 jurisdictions have given their consent. The U.S. Justice Department last month signed off — an approval that had been expected because of President Trump’s desire to see the Ellison family own CNN.

Paramount shares slipped on the news, falling 3.3% to $8.21 — marking the year’s lowest trading day. Warner’s stock gains since Monday’s restraining order ruling were suddenly erased. Warner shares finished at $25.77 — 17% lower than Paramount’s deal offer.

Now Paramount will have to pay Warner Bros. Discovery investors more than the $31 a share it previously promised.

In a show of confidence earlier this year, the company boasted it would quickly secure the necessary regulatory approvals to finalize the Warner purchase by late September. As an added incentive to win over investors, the company said it would pay so-called “ticking fees” should the deal encounter snags.

Those fees of $.25 a share per quarter begin Oct. 1, adding about $650 million to the pricetag each quarter until close. If Paramount is unable to close the deal by June 1, it would owe Warner Bros. Discovery a $7 billion breakup fee.

Larry Ellison, co-founder of software giant Oracle, is bankrolling his son’s ambitions to acquire a second major entertainment company in less than a year. The Ellison family acquired the smaller Paramount in August.

The Democratic state attorneys general, including from New York, New Mexico, Nevada, Colorado, Oregon and Washington, filed their lawsuit nearly two weeks ago.

The state attorneys general have alleged the deal would harm competition in three markets: films released widely (in more than 3,000 theaters); potential blockbuster films; and a concentration of cable TV channels.

Paramount insists that streaming marketshare be included in the market definition because a combined Paramount+ and HBO Max would still trail industry leaders, Netflix, YouTube, Amazon Prime and Disney+.

“Plaintiffs’ market definitions bear no relationship to the realities of today’s marketplace and cannot withstand scrutiny,” Paramount’s spokesperson said.

In her order earlier this week, Martínez-Olguín wrote that the plaintiff states presented “compelling evidence” that the merged company could wield too much control in theatrical distribution.

Friday’s agreement came after Martínez-Olguín on Thursday extended the restraining order for another 14 days — until Aug. 17 — in recognition the two sides needed time to hash out their scheduling requests. In addition, the Writers Guild of America has filed its own antitrust lawsuit, and the judge agreed to allow that case to move forward with the states’ case.

The Aug. 3 preliminary injunction hearing will be canceled as the two sides prepare for a trial.

“We are eager to continue to make our case in court …to ensure this unlawful merger never sees the light of day,” Bonta said.

The months-long delay is expected to affect Warner Bros. Discovery Chief Executive David Zaslav’s proposed $887-million exit package.

As part of a pact earlier this year, Warner board members agreed to cover Zaslav’s expected $335 million in tax obligations tied to his enormous payout, according to regulatory filings. However, Warner is not on the hook to cover Zaslav’s tax bill should the deal extend into 2027.

The merger has faced stiff resistance in Hollywood and beyond. More than 5,000 entertainment industry workers have signed an open letter calling on Bonta to block the merger.

Britain’s culture minister has also signaled that she may open a full inquiry into the proposed media consolidation, which could also bring other delays.

“This victory in putting the merger on hold belongs to the people who refused to treat the merger as inevitable,” Norm Eisen, a former ambassador and Obama White House ethics lawyer who is helping lead the #BlocktheMerger campaign.

“Artists, journalists, filmmakers, and consumer advocates spoke out despite the risk of retaliation, more than 5,500 people signed our open letter,” Eisen said in a statement. “This collective resistance is turning the tide.”

Paramount Skydance’s top antitrust attorney told a judge Friday that David Ellison’s company would voluntarily delay its proposed $111-billion takeover of Warner Bros. Discovery at least until mid-August amid a legal challenge brought by 12 state attorneys general.

The states, led by California Atty. Gen. Rob Bonta, have asked a judge to issue a temporary restraining order that would prevent Paramount from finalizing its deal as the court battle ramps up. Paramount made the pledge in hopes of avoiding such a ruling that would tie its hands — and give the states an early win in the litigation.

Federal District Judge Araceli Martínez-Olguín said she would decide by Wednesday whether to issue a restraining order.

Tech scion David Ellison has been a regular in Washington D.C. this year as he races to consolidate Warner Bros. Discovery — less than a year after his family bought Paramount.

(Anna Moneymaker / Getty Images)

Friday’s hearing in Oakland opened the first chapter in the fight over the blockbuster deal that both sides agree would dramatically reshape Hollywood. Two century-old film studios — with rights to Harry Potter, Batman, “Top Gun,” “The Big Bang Theory” and “Game of Thrones” — would be combined, and HBO and CNN would come under new ownership.

Antitrust attorney James H. Weingarten, of the Washington law firm Milbank, represents California and the other states. He told the judge it would be impossible to untangle the two companies if they are allowed to combine.

“If this merger is allowed to close … the harms begin,” Weingarten said. “The job losses, the synergies — that’s the fancy word for ‘we’re going to save money and there might be job cuts.’ All of that process starts rolling.”

Bonta filed the suit Monday, alleging the proposed merger — the largest in Hollywood in decades — would violate the U.S. Clayton Antitrust Act, a 112-year-old law to prevent mergers that weaken competition and raise costs for consumers.

The lawsuit alleges antitrust violations in three markets where the two companies currently compete: wide-release films, potential blockbuster movies and cable television, where the combined entity would own more than 50 cable channels.

Paramount shares fell 4.3% to $8.75 on Friday. Warner stock slipped 1.5% to $26.87 — below Paramount’s offer of $31 a share.

More than two dozen lawyers attended Friday’s hearing, including from Colorado, Oregon, Washington and New York who came to support California, which is leading the case.

Paramount, represented by antitrust lawyer Jeffrey L. Kessler, argued a temporary restraining order was not necessary. The two sides should instead focus on the next big step — whether the judge issues a preliminary injunction, he said. Such a ruling could delay the deal for months.

Kessler said Paramount should be allowed a hearing to defend against a preliminary injunction by the end of August. The company wants to wrap up the litigation by late September to avoid a higher payout to Warner Bros. Discovery shareholders.

In a show of confidence earlier this year, Paramount offered Warner Bros. Discovery shareholders a “ticking fee” of 25 cents for every quarter after Sept. 30 — until the deal was done. Such payments would cost Paramount more than $7 million a day, which Kessler called a “massive injury.”

California Atty Gen. Rob Bonta is leading a coalition of 12 state attorneys general to try to halt Hollywood’s biggest merger in decades.

(Genaro Molina/Los Angeles Times)

Paramount would also have to pay Warner a $7-billion breakup fee should the deal fall apart.

Kessler argued the states had not made a sufficient case that competition would be harmed. “We don’t think they’ve come close to jumping through that hurdle,” Kessler said.

Earlier this year, Kessler represented the state attorney generals in their winning case against Live Nation Entertainment. A jury found that Live Nation, which owns Ticketmaster, operated as a monopoly. This time, Kessler is representing corporate interests.

Prominent Los Angeles litigator Daniel Petrocelli is representing Warner Bros. Discovery.

Paramount hired attorney Jeffrey Kessler to lead its antitrust defense.

(Noah Berger / Associated Press)

The case was assigned to Martínez-Olguín Wednesday after Paramount requested an earlier judge be removed because he formerly worked as a labor attorney.

Martínez-Olguín said she inherited the case because she was already overseeing another lawsuit dealing with the merger — not because Paramount had agitated for a change.

Only a few days ago, Paramount Skydance’s planned $111-billion takeover of Warner Bros. Discovery appeared to be on the glide path to completion.

The deal, which would be the largest merger in Hollywood history, had won approval from several foreign governments and, on June 12, Justice Department antitrust regulators.

The Justice Department’s assent looked to be a major step toward fulfilling the ambitions of David Ellison, the son of multibillionaire tech tycoon Larry Ellison, to bring together Paramount and Warners, which owns CNN and CBS among other properties, under one roof.

The Justice Department’s action ignited suspicions that the Ellisons had profited from their support of President Trump. But it has turned out not to be the last word on the deal. The very next day, California and 11 other states filed a motion to block the merger, stepping in where the Justice Department chose not to tread.

“I will not let Warner Bros. and Paramount merge without a fight,” California Atty. Gen. Rob Bonta said in announcing the states’ action. A hearing on the motion is scheduled for Friday in San Francisco federal court.

There’s more to this development than an effort to block Ellison’s attempt to repave the entertainment landscape for his own benefit, even though, as my colleague Meg James reports, the states’ motion “poses a major headache” for Ellison. It’s also a pointer toward a major restructuring of antitrust enforcement in the United States.

Customarily, state regulators have piggybacked on antitrust cases brought and managed by the federal government. The feds generally have greater resources than most individual states to conduct the investigations that can lead to antitrust lawsuits. States often have relied on the government to craft consistent and coherent theories of antitrust law to undergird their lawsuits.

But the Trump administration’s apparent pullback from aggressive legal pursuit of allegedly anti-competitive mergers has left a vacuum that states have moved to fill. That’s what’s driving their motion to block the Paramount-Warner Bros. deal.

Dating back to the first Trump term, California and other states have enacted new laws resembling federal statutes requiring merger proponents to provide detailed information about planned deals.

States also have filed their own lawsuits to challenge anticompetitive conduct by pharmacy benefit managers and algorithmic pricing that has driven up housing rents via alleged collusion.

States may have an advantage over the federal government in that their regulators can move faster on complex cases than the feds. That’s what happened in the fight against the proposed 2023 merger of supermarket companies Kroger and Albertsons, something that was widely feared to presage higher prices at the shelf.

Although the Federal Trade Commission moved to block the merger, so too did Oregon, Washington and nine other states in court. The companies called off the merger after a state court in Washington and a federal court in Oregon, ruling on that state’s lawsuit, simultaneously enjoined the merger on Dec. 10, 2024. One day later, Albertsons dropped the proposal.

Some supporters of effective antitrust enforcement suggest that the states’ involvement in these cases could be an effective counterweight to the mercurial approach taken toward enforcement under Trump, which seems to be driven by personal pique, as Paul Glastris, editor of the Washington Monthly, has written.

In 2017, Trump’s Justice Department sued to block AT&T’s acquisition of Time Warner, driven by Trump’s irritation over the coverage he received from CNN, which was owned by Time Warner. (I described the lawsuit as Trump’s doing the right thing for the wrong reason.) The merger eventually went through.

The best example of the states’ willingness to supplant the feds as antitrust enforcers in chief is the antitrust case against Live Nation Entertainment. The federal government and 30 states originally filed the case in 2024 in federal court in Manhattan. The lawsuit sought to break up Live Nation, which has controlled scores of top concert venues, in part by forcing it to divest Ticketmaster, the leading entertainment ticketing firm.

A few days after the trial began this spring, the Justice Department reached a settlement with Live Nation. The settlement led to accusations that the White House interfered in the Justice Department’s work on the case, including that Trump himself personally pushed for a settlement and that the deal was reached without the participation or even the knowledge of the Justice Department lawyers handling the case or of the state attorneys general who were participating. The White House referred my request for comment on these accusations to the Justice Department, which didn’t respond.

The states, asserting that the settlement wouldn’t cure Live Nation’s alleged violations of antitrust law, took over the lawsuit — and won. In mid-April, a federal jury found that Live Nation had maintained a monopoly over the live events business, exposing the company to the states’ claims of as much as $700 million in damages and a possible order that it sell Ticketmaster. The company says it will appeal.

The history of antitrust enforcement in the U.S. generally resembles the complaisant stance taken under Trump. Since the enactment of America’s first antitrust statute, the 1890 Sherman Act, industry has generally benefited from lax enforcement, in part because antitrust theory has been ever-changing. During the New Deal, President Franklin Roosevelt suspended antitrust enforcement so his National Recovery Administration could pursue its mandate to suppress industrial competition, which was thought to drive up prices and thereby foster the Great Depression.

The Supreme Court overturned the National Recovery Administration in 1935, though it had already lost credibility. Roosevelt responded in 1938 by appointing Thurman Arnold, a critic of existing antitrust theory, as the Justice Department’s antitrust chief. In his writings, Arnold implied that antitrust law as then interpreted was a fraud aimed at acclimating consumers to ever-larger business combinations through the pretense that “unfair” or “immoral” deals would be barred.

Arnold’s appointment marked what may have been the most productive period in antitrust enforcement. By the time he departed for a federal judgeship in 1943, he had brought more than 50% of all the cases brought under the Sherman Act in its half-century of existence. He broke the auto industry’s stranglehold on consumer auto lending, and started a case that concluded with the Hollywood studios’ forced divestment of their theater chains.

Since then, there have been a few notable antitrust successes, including the 1982 breakup of AT&T. That resulted from a Justice Department antitrust lawsuit launched in 1974. But the consolidation of major industries into fewer and fewer participants, especially in entertainment, has continued with very few roadblocks.

Occasionally, an aggressive enforcer comes into office. That happened under Lina Khan, whom President Biden appointed as chair of the Federal Trade Commission. (The FTC shares antitrust oversight with the Justice Department.)

Khan’s published academic work had taken aim at what she called the lax antitrust treatment of companies such as Amazon. Her argument was that antitrust enforcers’ focus on whether a monopolizing company brought consumers lower prices overlooked the longer-term consequences of giving companies the unfettered right to build market share at the expense of competitors and the free market.

Amazon “has evaded government scrutiny in part through fervently devoting its business strategy and rhetoric to reducing prices for consumers,” Khan wrote in a key article. Once it reached a critical mass, she argued, nothing would stop Amazon from extracting monopoly rents from consumers.

Khan’s aggressive stance on antitrust law earned her the enmity of targets such as Amazon and Facebook, which tried to force her to recuse herself from FTC cases against them. She refused, but due to corporate distaste for her policies, Trump replaced her as FTC chairman on his inauguration day last year.

The Paramount-Warner Bros. deal could be a key test of states’ authority and willingness to take over antitrust enforcement from the federal government. That’s because they’ll be fighting not only resistance from the merger partners, but the government’s conclusion that the deal poses no threat to consumers.

On the other hand, their case at least will be free of the suspicion that the government’s approval owed more to Trump’s friendship with the Ellison family than to sober, painstaking analysis of how reducing the number of big entertainment companies from five to four would be good for the rest of us.

The Writers Guild of America sued Paramount on Tuesday, alleging that the company’s planned $111-billion acquisition of Warner Bros. Discovery violates federal antitrust law.
The union said that with fewer competitors, the merged Paramount-Warner Bros. Discovery business would be able to lower costs by reducing writers’ wages and work.

“Writers will be paid less and have fewer employment opportunities,” the WGA said in its lawsuit.

The move comes a day after California Atty. Gen. Rob Bonta led a coalition of 12 Democratic state attorneys general who filed a federal lawsuit to block Paramount Skydance’s $111-billion merger with Warner Bros. Discovery.

Bonta has separately asked a judge in San Francisco for a temporary restraining order to hold up the deal while his case is pending in court.

“We feel we have a very strong case,” Bonta said Tuesday during a town hall meeting. “This proposed merger will raise prices. It will lower quality. It will reduce output. It will hurt the American people, and it’ll hurt the the economy and competition.”

The writers guild’s missive creates a second line of attack against tech scion David Ellison’s industry-reshaping deal.

Ellison’s proposed merger has been moving closer to the finish line after securing approvals from the U.S. Justice Department and numerous other foreign governments. President Trump, an ally of Ellison’s billionaire father Larry Ellison, favors the deal.

David Ellison wants to close the deal by September to avoid a higher payout to Warner Bros. Discovery shareholders.

A Paramount spokeswoman said the company is reviewing the lawsuit.

The proposed merger has sparked fears in Hollywood that it would bring thousands of job losses — similar to past consolidations, including Walt Disney Co.’s 2019 takeover of Fox entertainment properties.

“The Writers Guild of America will not stand idly by as Paramount attempts to violate our country’s antitrust laws and deepen the contraction entertainment workers already feel,” said Writers Guild of America East President Tom Fontana in a statement. “This proposed combined entity would be the largest employer of writers, with tremendous power to suppress our wages, eliminate opportunities for emerging writers, cut jobs across the industry, and produce less programming, affecting the range of storytelling. This merger is not inevitable and we are fighting to stop it.”

July 13 (UPI) — The attorneys general of 12 states sued Monday to block the proposed merger of Paramount and Warner Bros., saying it would undermine competition in the entertainment industry.

A news release announcing the lawsuit from New York Attorney General Letitia James said Paramount Skydance Corp.’s purchase of Warner Bros. Discovery Inc. “would combine two of the five major film studios and two of the five major basic cable companies, creating a massive conglomerate in markets for basic cable and theatrical film releases.”

“For over a century, Paramount and Warner Bros. have competed to create movies and television that bring people together, inspire and sustain generations of artists, and help us understand the world,” James said. “This merger would destroy that competitions, creating a massive company with unprecedented power and influence over news and entertainment across the globe.”

The release said the merger would increase costs for consumers and put jobs at risk.

The lawsuit comes one month after the Justice Department approved the planned merger, saying it doesn’t harm consumers in the United States.

Warner Bros. shareholders gave their blessing to the merger in April after Paramount offered to buy the company for $31 per share — a deal worth $110 billion.

Joining New York in the lawsuit were Arizona, California, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, Oregon and Washington.

Deadline reported that Paramount could threaten to leave California in retaliation for the state’s involvement in the lawsuit. California Attorney General Rob Bonta described the two companies as “behemoths” in the entertainment industry and said their merger would lead to higher prices, lower quality and less content for consumers.

“California’s film and entertainment industry touches the lives of Americans daily — it comes into the living rooms of families, has a starring role in many young people’s first dates, and is a point of immense pride and employment for Californians up and down our state,” he said in a news release.

“Consolidation here not only leads to higher prices — it also leads to fewer opportunities for important stories to come to life, and fewer ways for audiences to encounter stories, ideas, and perspectives beyond their own experiences.”

California Atty. Gen. Rob Bonta and 11 other Democratic state attorneys general filed a lawsuit Monday to block Paramount Skydance’s proposed $111-billion takeover of Warner Bros. Discovery — a last-ditch effort to derail a deal that would transform Hollywood.

Tech scion David Ellison’s proposed merger has been hurtling toward the finish line after securing approvals from the U.S. Justice Department and numerous foreign governments. President Trump, an ally of Ellison’s billionaire father Larry Ellison, favors the deal. He is eager for a big shakeup at CNN, which is currently controlled by Warner Bros.

David Ellison now faces his biggest challenge yet as he attempts to build a new entertainment behemoth.

A Paramount representative did not immediately comment.

The suit, filed in federal court in San Francisco, alleges that the proposed merger would violate the U.S. Clayton Act, a century-old antitrust law to prevent mergers that weaken competition and increase costs for consumers.

“Consolidation here not only leads to higher prices — it also leads to fewer opportunities for important stories to come to life, and fewer ways for audiences to encounter stories, ideas, and perspectives beyond their own experiences,” Bonta said in a statement.

“California and our sister states are fighting for free and fair markets, not rigged markets,” he said.

California and the 11 other states, including New York, New Jersey, Washington and Colorado, allege the merger would devastate the theatrical film business by combining two historic film studio rivals. The Ellison family would control such storied franchises as Harry Potter, Bugs Bunny, Batman, “Top Gun” and “Game of Thrones.”

The proposed purchase also would unite two prominent news organizations — CNN and CBS News.

The states have asked Paramount to delay the closing of its Warner Bros. takeover until the litigation can be resolved.

If Paramount refuses, Bonta said the coalition would seek a temporary restraining order asking a judge to hold up the merger, a move that would cause costly delays and escalate legal expenses for Paramount in their quest to finalize the deal.

Larry Ellison, co-founder of software giant Oracle, is bankrolling his son’s ambitions to acquire a second major entertainment company in less than a year. The Ellison family acquired control of CBS-owner Paramount in August and, at the time, David Ellison touted the move of Paramount’s headquarters from New York’s Times Square to Hollywood.

Now, Paramount is reportedly threatening to leave California in the face of Bonta’s legal action.

If the merger goes through, Paramount would own four streaming services, including Warner’s HBO Max and the dominant U.S. cable TV channel owner with HBO, TBS, HGTV, Animal Planet, Food Network, Comedy Central and Nickelodeon.

The U.S. Justice Department last month approved the merger, saying the combination would likely bolster competition — not harm it. The agency’s decision had been expected because of Larry Ellison’s strong support of Trump.

In a show of confidence earlier this year, the Ellisons agreed to increase the payout to Warner investors should the regulatory approval process drag on. Those extra 25-cent-per-share payments begin with the October-December quarter, and would add more than $650 million in deal costs each quarter — giving David Ellison an increased incentive to quickly close the deal.

The proposed merger has sparked fears in Hollywood that it will bring thousands of job losses — similar to past consolidations, including Walt Disney Co.’s 2019 takeover of Fox entertainment properties.

Some theater owners, hard hit by the pandemic and production slowdowns, have expressed concerns the merger would lead to fewer films being made.

The new colossus would significantly dampen competition, Bonta and the other Democrat prosecutors argue. They pointed to the wide-release movie film distribution business, where Warner Bros. and Paramount control about 27% of the market.

After the merger just four companies — Paramount-Warner, Disney, NBCUniversal and Sony Pictures — would control 86% of the films that were widely released, Bonta said.

Paramount has said the deal will boost competition — not hamper it. Ellison has promised to continue releasing 30 films a year with a combined Warner Bros.-Paramount studio, roughly the current output of the two studios.

Ellison also vowed to protect the HBO brand.

Another concern is the licensing of basic cable TV channels, including CNN and HGTV, to pay-TV providers such as Charter’s Spectrum, DirecTV and Google’s YouTube TV. Warner Bros. is the second largest cable channel owner and Paramount is the third largest. Together their channels would represent about 27% of the market.

The typical threshold for antitrust concerns is at least 30% marketshare.

More than 5,000 entertainment industry workers, including Jane Fonda, Ben Stiller, Bryan Cranston, Javier Bardem, Lin-Manuel Miranda and Mark Ruffalo, signed an open letter calling on Bonta to block the merger.

Some have expressed concerns about marrying CNN and CBS News following months of turmoil at CBS News since David Ellison hired journalist Bari Weiss as CBS News editor in chief. Last month, Weiss orchestrated a dramatic shakeup at the iconic “60 Minutes” news program, with top executives and three well-known correspondents tossed out.

The Ellison family recently shed its movie theater chain, which it picked up as part of the Paramount acquisition, to clear the way for the Warner deal.

California Atty. Gen. Rob Bonta is leading an effort by state attorneys general to block Paramount’s proposed takeover of Warner Bros. Discovery.

(Paul Kuroda/For The Times)

The deal also faces opposition outside the U.S.
. The British culture minister in late June said she was weighing whether to intervene in the deal due to concerns about maintaining a competitive media market. Britain’s Competition and Markets Authority also has opened an investigation into Paramount’s proposed merger.

In April, a federal judge in Sacramento granted a request from Bonta and seven other attorneys general for a preliminary injunction, which freezes the merger of Nexstar Media Group, which owns KTLA-TV Channel 5, and Tegna. The deal was designed to create the nation’s largest TV outlet group .

A larger group of state attorneys general also won a New York jury verdict against Live Nation Entertainment and its subsidiary Ticketmaster. Jurors found that Live Nation had illegally monopolized the live concert industry.

Bonta also has an ongoing case against Amazon for price fixing, which the company denies.

Still, legal experts say the states may face an uphill climb to detrail the Paramount-Warner Bros. merger because the arrival of Netflix, Amazon and Apple dramatically shifted the landscape.

The tech giants, which introduced consumer-friendly streaming options, have lessened the influence of traditional companies like Paramount and Warner Bros.

Paramount’s deal would mark the third time Warner has changed hands in the last decade.

AT&T bought the company in 2018 and then sold it to the smaller Discovery four years later. That deal left Warner Bros. burdened by debt, leading to deep cost cuts and setting the stage for the Ellison takeover.

Britain’s culture minister may challenge Paramount Skydance’s takeover of Warner Bros. Discovery — presenting a potential speed bump to David Ellison’s plan to wrap up his $111-billion deal by September.

Earlier this month, Paramount secured the U.S. Justice Department’s blessing to buy the Warner assets, which include CNN, HBO, Cartoon Network, Animal Planet and the Warner Bros. film and TV studios in Burbank.

Paramount also must win the approval of British and European regulators, who are known for drilling deeply into media matters because of their influence on society.

Britain’s Competition and Markets Authority took a preliminary step this month by opening an investigation into Ellison’s proposed merger.

On Tuesday, Lisa Nandy, Britain’s secretary of state for culture, media and sport, notified Parliament that she was inclined to intervene in the blockbuster deal.

In a written statement, Nandy cited her ability to weigh in on “public interest grounds,” due to concerns about maintaining a competitive media market in Britain.

“The UK’s move to intervene in the Paramount–WBD deal confirms what we’ve been saying for months. The real regulatory risk was never in the US — it’s in Europe,” Forrester VP Research Director Mike Proulx said Tuesday in a statement.

While Nandy cautioned she has not made “a final decision on intervention at this stage,” she has invited Paramount and Warner Bros. to respond to her concerns by Monday.

Lisa Nandy, Britain’s secretary of state for culture, media and sport, has said she may intervene in the deal on “public interest grounds.”

(Alishia Abodunde / Getty Images)

Paramount did not offer immediate comment.

The company owns CBS News, children’s channel Nickelodeon and Channel 5, one of the largest over-the-air television broadcasters in the United Kingdom.

Warner Bros. Discovery owns CNN, Cartoon Network and TNT Sports, which broadcasts the Olympics, Champions League and Premier League soccer matches.

“I am conscious that the proposed acquisition is global in nature,” Nandy wrote in her statement. “In reaching this decision, my focus has been, and will remain, on the UK public interest and the range of services available to UK audiences, including Channel 5, TNT Sports, Cartoon Network, Nickelodeon, and CNN International, as well as Paramount+ and HBO Max.”

If Nandy decides to intervene, the Office of Communications, known as Ofcom, would launch an assessment of the deal. Britain’s Competition and Markets Authority also would determine how the merger might reshape the competitive landscape.

Teams from the two companies have been huddling for months to plan for the melding of the two operations as soon as Paramount receives all of its regulatory approvals.

Australia, New Zealand, China, Saudi Arabia, Ukraine, Serbia, France and Italy have already given their approvals to the deal.

Saudi Arabia’s Public Investment Fund is planning to contribute $10 billion to help the billionaire Ellison family pull off the merger, which would make the Saudi royal family a significant, although passive, equity owner. In addition, the royal families of Qatar and Abu Dhabi have agreed to each contribute $7 billion in equity financing.

The Federal Communications Commission must evaluate the foreign ownership stakes due to Paramount’s holding of CBS broadcast licenses. U.S. antitrust regulators already have concluded the combination would not violate federal anticompetition laws.

Approval had been expected because President Trump — who has friendly ties with Ellison and his father, tech billionaire Larry Ellison — favors the deal.

Trump has been eager for changes at CNN.

The U.S. government stopped short of asking Paramount to make concessions or divestitures. Many expect that Paramount may have to reconfigure its children’s television holdings abroad due to the proposed combination of two large players — Nickelodeon and Cartoon Network.

Nandy suggested that Britain also should scrutinize the impact of combining two major streaming services, HBO Max, a Warner property, with Paramount+.

HBO programming, including “Game of Thrones,” “Boardwalk Empire” and “Succession,” has long been popular in Britain.

A coalition of state attorneys general, led by California‘s Rob Bonta, also is expected to challenge the deal, in part, due to concerns about news media consolidation. Bonta’s office has said the matter remains under review.

Opposition to the deal has been building in the U.S. for months. A group of Hollywood activists — led by actors Jane Fonda and Mark Ruffalo — have spearheaded a “block the merger” campaign that now has support from more than 5,000 entertainment workers.

The group’s open letter calls on Bonta to take action to thwart the Ellison expansion effort. Paramount’s Chief Legal Officer Makan Delrahim has blasted the campaign, calling it “fear-mongering” and a partisan distortion of antitrust law.

Forrester’s Proulx noted differences in attitudes toward the deal among the various constituencies.

“For U.S. consumers, this merger has become a proxy fight about political influence and control of media,” Proulx said. “In the UK, it’s being treated as a structural competition issue where regulators, not consumers, will decide how this deal plays out and how long it takes.”

The U.S. Justice Department has cleared the way for Paramount Skydance’s $111-billion purchase of Warner Bros. Discovery — a major milestone that moves David Ellison closer to his goal.

After a months-long review, Justice Department antitrust regulators on Friday concluded the combination would not violate federal anticompetition laws. Approval had been expected because President Trump — who has friendly ties with Ellison and his father, tech billionaire Larry Ellison — favors the deal.

The government stopped short of asking Paramount to make concessions or divestitures.

Buying Warner Bros. would allow Paramount — Hollywood’s smallest major company — to bulk up with such prestigious properties as HBO, CNN, HGTV and Food Network. Those would be combined with properties Paramount already owns, including CBS, Comedy Central, Nickelodeon and MTV.

The deal would put two historic film studios and two prominent news organizations under the same roof. It would give Paramount four streaming services, including HBO Max, and dozens of cable channels.

In its four-page closing statement, the Justice Department emphasized that career antitrust regulators — not political appointees — had performed a rigorous review, sifting through some two million documents the government received from dozens of sources, including third-party organizations.

They conducted meetings and deposed senior-level executives and other witnesses.

“These investigative efforts all led to the same conclusion: the film and television industry is highly dynamic, and the proposed transaction is not likely to harm competition or American consumers,” Justice Department regulators wrote in their summary.

Regulators zeroed in on three potential areas of concern. They looked at whether the merger would give Paramount too much power in the streaming video-on-demand market; the traditional linear television channel space; as well as in “studio development, production, or distribution of films for theatrical release,” the Justice Department said.

Competition in streaming would not be crimped, according to the regulators.

“To the contrary, the combined firm is likely to increase competition by offering consumers a more robust competitive alternative to the larger [streaming] offerings,” they wrote.

The antitrust division also found that theatrical distribution and opportunities for creators, including writers and actors, would not be harmed as long as the combined company maintained current production levels.

Ellison has promised to continue releasing 30 films a year with a combined Warner Bros.-Paramount studio. He also has said he would protect the HBO brand.

The proposed merger is controversial because many in Hollywood fear it will bring thousands of job losses, which was the result of past consolidations, including Walt Disney Co.’s 2019 takeover of Fox entertainment properties. More than 5,000 entertainment industry workers, including Jane Fonda, J.J. Abrams, Javier Bardem and Mark Ruffalo, have signed an open letter calling for the merger to be blocked.

There’s a political dimension as well. Paramount’s standing with the Trump administration (Paramount+ is set to televise Sunday’s UFC fight spectacle at the White House to celebrate Trump’s birthday as part of the company’s relationship with the UFC) has given left-leaning groups pause.

They worry about collapsing CNN and CBS News into one unit, particularly after all the turmoil that has ensued at CBS News since the Ellison family bought Paramount in August and installed Bari Weiss as CBS News editor in chief.

This month witnessed a dramatic shakeup at the iconic “60 Minutes,” with top executives and three well-known correspondents tossed out.

“We’ve already seen how far Paramount and the Ellison family are willing to go to diminish a once-proud network and news organization like CBS,” Craig Aaron, co-chief executive of the progressive group Free Press, said in a statement. His group fears the Ellisons would “do worse if they get their hands on Warner Bros., HBO, CNN and all the rest.”

Paramount, for its part, said it was grateful for “the Department of Justice’s thorough review of this transaction, as well as the work of the other agencies that have completed their reviews and provided clearance to date.”

“This deal is pro-competitive, resulting in a stronger company better positioned to compete against dominant technology platforms in an industry increasingly defined by intense competition for audiences, talent, technology, and investment,” Paramount said. “We remain focused on completing the transaction as soon as possible and delivering its benefits to consumers, creators, and the entertainment industry as a whole.”

Paramount wants to finalize its purchase by September.

With Friday’s victory, Paramount is staying on that timetable, but regulators in Europe and Britain have opened their own regulatory investigations and are expected to make their own determinations in the coming months.

Separately, California Atty. Gen. Rob Bonta and other state attorneys general have been scrutinizing the proposed merger, and are widely expected to file a lawsuit, perhaps as early as this month, to try to block it.

Paramount applied for Justice Department approval in December — more than two months before it edged out Netflix in the Warner sweepstakes.

In its statement, the Justice Department said it began its review last fall when it was clear Warner Bros. was in play. Regulators said they were familiar with Warner’s businesses, because the division had scrutinized four other mergers involving the company, dating back to the disastrous AOL-Time Warner merger in 2001.

Paramount’s deal would mark the third time Warner has changed hands in the last decade. AT&T bought the company in 2018 and then sold it to the smaller Discovery four years later. That deal left Warner Bros. burdened by debt, setting the stage for the Ellison takeover.

Justice Department approval could complicate efforts by Bonta and other state attorneys general to block the deal. Should Bonta or others sue, they would have to convince a judge that the nation’s top antitrust regulators failed to make a proper finding despite their lengthy review.

That may pose a high bar for the state officials, who are facing political pressure to stop the deal.

“State AGs must block this merger,” U.S. Sen. Elizabeth Warren (D-Mass.) said in a statement Friday, adding that the Justice Department’s approval was “terrible news for every American who doesn’t want Trump-aligned billionaires to control what they watch and how much they pay.”

The Justice Department said state attorney general offices had participated in its investigation, which allowed federal and state officials “to share information with each other and for the States to attend and participate in the [antitrust] Division’s depositions.”

Last month, David Ellison appeared before the regulators in a two-hour session.

Paramount’s Chief Legal Officer Makan Delrahim, who previously served as the nation’s top antitrust regulator during the first Trump administration, also was busy quarterbacking Paramount’s outreach with regulators.

June 12 (UPI) — The U.S. Department of Justice on Friday said the proposed merger between Paramount Skydance and Warner Bros. Discovery does not harm competition or consumers in the United States.

The Justice Department said that it finds the proposed merger is unlikely to harm competition among similar companies or the ability of American consumers to access video-based media, it said in a press release.

Paramount in January hiked up its offer well beyond what Netflix had offered for the entertainment conglomerate, circumventing the streaming leader from acquiring it, and triggering antitrust investigations in a number of nations both operate in.

At least ten state attorneys general said last week they would sue the federal government to stop the proposed merger, which would create a monolith company comprised of several of the most significant companies in television, film and entertainment.

“This investigation included a review of reams of documentary evidence, hours of deposition testimony of senior-level executives, interviews with third-party witnesses and staff-led meetings with the parties themselves,” the Justice Department said in the release.

“These investigative efforts all led to the same conclusion: The film and television industry is highly dynamic and the proposed transaction is not likely to harm competition or American consumers,” the department said.

The Justice Department said in the release that, among other discoveries that drove its decision, the fact that Warner Bros. has “been a repeated acquisition target in the media and entertainment industry” shows that it is appropriate to approve the merger.

The Ellison family-controlled Harbor Lights Entertainment has sold its Showcase Cinemas theater chain to a major European cinema group in a $30-million deal.

Belgium-based Kinepolis will soon operate 13 cinemas across the United States. Seven are in Massachusetts, four in New York, one in Ohio and one in Rhode Island.

David Ellison, who is now in charge of Paramount Skydance, acquired National Amusements last year from the Redstone family. He renamed the company Harbor Lights. National Amusements was the start of Redstone’s media empire, which at one point included control of CBS, Paramount and Viacom.

Paramount is in the process of acquiring Warner Bros. Discovery in a $111-billion deal. Under the proposal, Ellison has said the two studios will release 30 films per year. But he and his team would also have to make $6 billion in cuts and take on $79 billion in deal debt.

The deal is awaiting regulatory approval, but officials in several state states recently announced plans to try to block the merger. The potential lawsuit would seek to challenge the proposed merger on antitrust grounds, arguing it would decrease competition, lower wages and lead to widespread job losses.

With the sale of the theaters, Kinepolis will add 164 screens to its portfolio. The company was formed in 1997 and currently operates 63 cinemas in Europe and nearly 60 theaters in the U.S. and Canada.

The newly acquired theaters welcomed about 4 million visitors and generated more than $90 million in revenue last year.

“This acquisition allows us to expand our market position in the U.S. from Michigan to the East Coast with an asset and a team that enable us to implement Kinepolis’ operational model and corporate strategy, ultimately enhancing the experience for moviegoers in these markets,” Eddy Duquenne, Kinepolis’s chief executive, said in a statement.

The company said Showcase Cinemas would retain its name. It expects the acquisition to be complete by the end of the summer.

Times staff writer Wendy Lee contributed to this report.

June 5 (UPI) — The attorneys general of several states are preparing to file a lawsuit in the coming weeks to prevent the $111 billion merger of Paramount Skydance and Warner Bros. Discovery.

As many as 10 states are involved in a California-led antitrust investigation of the merger, which would create an entertainment monolith comprised of two of the biggest major players in television, film and streaming globally, the Los Angeles Times, Bloomberg and The Wrap reported.

Officials in the states have started working on the lawsuit and where to file it, the news organizations confirmed, and the litigation could potentially be filed before the end of June.

Although California Attorney General Rob Bonta told The Wrap in early April that “red flags are everywhere when you have a merger of this type,” his office did not confirm that the lawsuit was taking shape and could be filed soon.

“The Paramount acquisition of Warner Brothers remains an active investigation, and we do have any updates to share at this time,” Bonta’s office told the news organizations in a statement.

The states that have been involved in Bonta’s investigation and may join the lawsuit, aside from California, are Colorado, Connecticut, Massachusetts, Nevada, New York, Oregon, Pennsylvania and Tennessee.

Paramount and Netflix competed for months to win the right to buy Warner Bros. Discovery, with Warner’s shareholders voting to approve selling the company to Paramount for $31 per share.

The merger has been controversial because Paramount Chairman David Ellison has said that after the company receives regulatory approval, he plans to make $6 billion in cuts between both companies.

Although Ellison said that the Paramount and Warner Bros. film studios will maintain their current pace of 15 theatrical releases per year, the deal has drawn sharp rebukes from across Hollywood and some parts of the federal government because the downsizing will most likely include job cuts.

A year ago, David Ellison was viewed as a white knight poised to save Paramount.

Hollywood embraced billionaire Larry Ellison’s son, figuring he had the means and the mettle to revive the faded studio after decades of neglect.

But now, as the 43-year-old tech scion works to close his $111-billion deal to buy Warner Bros. Discovery — which would mark his second major studio acquisition in less than a year — a large swath of Hollywood has soured on the budding mogul and his audacious bid to build a new media colossus.

More than 5,000 artists and industry workers — including J.J. Abrams, Javier Bardem, Lin-Manuel Miranda, Kevin Bacon and Tiffany Haddish — have signed an open letter opposing the union of two century-old studios.

“Our industry is already under severe strain,” the group wrote.

Many anticipate the U.S. Justice Department will rubber-stamp the deal because President Trump is friendly with Larry Ellison, co-founder of software giant Oracle. Trump and his team want David Ellison to make sweeping changes at CNN, one of Warner Bros. Discovery’s premier properties.

David Ellison has spent the last year courting the president and his allies, including hosting a black-tie gala to honor Trump and attending state dinners and the president’s State of the Union address.

Ellison’s perceived coziness with the administration, along with controversial changes at CBS, has sullied his reputation in a town where image is everything.

Should the merger clear its regulatory hurdles, the Ellison family would control CNN and CBS News in addition to holding a significant stake in TikTok, the hugely influential social media app.

“When power is concentrated in fewer and fewer hands, the stories that get told and the livelihoods of the people who tell them become hostage to whoever that power serves,” Jane Fonda, the Oscar-winning actor who is helping lead the opposition, told The Times. “We are not going quietly.”

Paramount declined to comment. Ellison previously has pushed back on fears that Paramount’s takeover of Warner Bros. would be bad for Hollywood. Instead, Ellison envisions building a stronger company to boost the industry, including movie theaters.

If the Warner Bros. Discovery deal is finalized, Ellison would control two legendary news organizations and two iconic studios. His determined White House outreach to speed approval of the Warner Bros. deal has aroused deep suspicion among many in Hollywood, which has long been considered a liberal bastion.

“They got too close to Trump,” said Norm Eisen, executive chairman of Democracy Defenders Fund, one of the groups coordinating the opposition campaign. “People in Hollywood are concerned that the Ellisons are going to do to CNN what they did to CBS.”

One of Ellison’s first moves after taking over Paramount was to hire journalist Bari Weiss, who had no TV news experience, as CBS News editor-in-chief. Weiss, who built her reputation being a contrarian voice, along with her recently installed evening news anchor Tony Dokoupil got off to a rocky start.

During his inaugural week, Dokoupil awkwardly saluted Secretary of State Marco Rubio (a fellow Floridian). “CBS Evening News” viewership fell 9% this season. The program, which attracts 4.1 million viewers, musters less than half the audience for ABC’s “World News Tonight with David Muir.”

Ellison is aiming to get his deal done by September.

“The projected merger timeline would have Ellison in control of CNN before November,” Fonda said, noting the high stakes this fall because the midterm elections will decide control of Congress.

“If this merger goes ahead, the administration will have yet another lever to cast doubt on results it does not like,” Fonda said. “This is about corruption, not optics.”

Her group has urged California Atty. Gen. Rob Bonta to file a lawsuit to try to block the merger. Bonta has said his team is reviewing potential antitrust concerns with the deal, which he said has “red flags everywhere.”

Some in Hollywood favor Ellison’s takeover, saying it would lift two middling players to create more robust competition to Netflix, Disney and Amazon.

“This deal will set up an environment where we will have four competitive streaming services, and that’s a good thing for the creative community,” said Ari Emanuel, executive chairman of WME Group and Ellison’s agent.

Ellison is pressing ahead, working to secure government approvals in Britain, Europe and the U.S. Prominent Democrats in Congress have decried the deal and Ellison’s proposed ownership structure, which would include the royal families of Saudi Arabia, Qatar and Abu Dhabi as significant, but passive, investors.

Paramount leaders have tried to keep their heads down by focusing on their businesses. This year, the company has signed deals with Kim Kardashian, Neil Patrick Harris, Tituss Burgess and Kinetic Content, the reality TV firm behind Netflix’s “Love Is Blind.”

Hollywood opposition

But the “block the merger” campaign has picked up prominent Paramount and Warner Bros. talent, including Oscar-winning filmmaker Adam McKay (“The Big Short”); “South Park” co-creator Trey Parker; and Emmy Award-winning actors Noah Wyle (“The Pitt”) and Mark Ruffalo, a stalwart of critically acclaimed HBO productions, including “Task.”

Some filmmakers have privately discussed whether to steer clear of Paramount, according to people knowledgeable of the discussions who were not authorized to comment. Taylor Sheridan, the prolific producer behind “Yellowstone” and “Landman,” last fall opted to switch teams. He eventually will make new shows for NBCUniversal instead of Paramount.

CBS late-night host Stephen Colbert’s sign-off Thursday night has added to the hand-wringing.

Colbert learned he was getting the boot in July, two days after he called Paramount’s $16-million settlement with Trump “a big fat bribe” during a show monologue. Paramount had agreed to pay the money to end Trump’s lawsuit over edits to a “60 Minutes” interview, a payout blasted by 1st Amendment advocates who viewed the Trump suit as frivolous.

Paramount settled because it needed Federal Communications Commission approval as part of its sale to the Ellison-owned Skydance Media. Paramount’s CBS has blamed declining revenues for its decision to oust Colbert, which came just before Ellison officially took the keys to Paramount.

This week, for the first time in 18 years, CBS will fall short of claiming the largest live audience in broadcast TV. NBC snagged the ratings crown, thanks to its sports-heavy lineup, prompting NBC late-night comedian Seth Meyers to crow about his network’s victory.

“We have taken down CBS,” Meyers told advertising buyers last week in New York. “Well, the Ellisons did, but I like to think we helped.”

Ellison’s supporters view the anti-merger campaign as politically motivated.

“So much of the criticism and negative sentiment originates from [Ellison’s] apparent relationship with Trump,” said one observer who was not authorized to speak publicly about the topic.

But interviews with numerous industry insiders reveal that concerns over Paramount’s proposed purchase of Warner go well beyond anti-Trump sentiment — or worries about CNN’s future.

The merger comes during an existential crisis for the industry, and for Los Angeles, as the shift to streaming has upended established business models.

“Whether it’s Ellison, Amazon, Apple or Netflix, these are essentially tech companies that are gaining increasing control over what has been a cultural and entertainment sector,” said Dominic Asmall Willsdon, executive director of the International Documentary Assn.

Amazon founder Jeff Bezos and Apple’s outgoing Chief Executive Tim Cook also have openly embraced Trump, which some see as a pragmatic move to curry favor in Washington to advance their sprawling businesses, which include film and TV operations in Culver City.

Much of the angst over the Ellison deal is driven by economic uncertainty. L.A.’s film industry has been decimated by a flight of production to other locations.

“L.A. has already had a taste of things to come,” Eisen said. “There’s less competition so the artists get hurt, and so do the working people who have long been an integral part of Hollywood.”

A combined Warner-Paramount would instantly become the largest employer for union writers, said Michele Mulroney, president of the Writers Guild of America West. It would control HBO, CBS, CNN, Comedy Central, HGTV, Animal Planet and two of the largest film and television studios.

“This media behemoth would have enormous leverage to reduce content, raise prices, increase control of production, suppress our members’ compensation and silence the voices of our members,” Mulroney said.

Jessica J. González, the L.A.-based co-chief executive of the 1st Amendment group Free Press, said: “This isn’t just about David Ellison. It’s about what David Ellison did with his last merger and how he uses his power.”

Ellison’s wealth and privilege have also fueled resentment among the rank and file who are struggling amid America’s growing economic disparity. Said one veteran executive: “We’re living in a new gilded age.”

For many, the prospect of more job losses is most unsettling.

Ellison and his team have vowed to make $6 billion in cuts following the merger. Those cuts are expected to include sizable layoffs on top of nearly 2,000 in job cuts at Paramount since last fall.

Hollywood has a troubled track record with mergers, including two failed takeovers of Warner Bros.

AT&T misfired with its 2018 acquisition of Time Warner, and within four years, the phone company had unloaded the firm to David Zaslav’s smaller Discovery. That transaction saddled Warner with more than $50 billion in debt, and Zaslav and his team laid off thousands of workers and cut dozens of projects to dramatically reduce the company’s debt and keep the company solvent.

Walt Disney Co.’s $72-billion acquisition of much of Rupert Murdoch’s 21st Century Fox in 2019 led to thousands of layoffs as one of the industry’s original studios all but disappeared.

“We have seen from that merger the earnings and employment numbers for screenwriters significantly reduced,” Mulroney said.

Emanuel, the power agent, pointed to Ellison’s commitment to keep the Warner and Paramount studios largely intact, with each entity releasing about 15 films into theaters each year.

“He’s going to be making a minimum of 30 movies a year for theatrical release plus content for both their own and other platforms because that’s the only way to generate revenue,” Emanuel said.

Still, critics question whether Ellison will be able to keep his commitment due to the $79-billion debt load he will take on.

“I’m sure [Ellison’s] intentions are genuine,” Mulroney said. “But a promise like that’s not enforceable, and there are no consequences if you don’t meet the quota that you’ve set for yourself.”

On Wednesday, S&P Global Ratings agency said Paramount Skydance will remain on a negative credit watch due to balance sheet concerns.

S&P also cited worries about Ellison’s prospects “given the immensely complicated endeavor of combining two of the largest global media companies and the limited track record of PSKY’s management team in integrating and transforming such companies.”

Emanuel and others say Ellison’s image won’t suffer long-term damage.

The two sides, he predicts, will eventually work together.

“Here’s a guy who’s willing to put a lot of money on the line and take huge risks to make our environment more competitive,” Emanuel said. “The one thing about David is that he’s not a vindictive person. He always does what’s best for the project.”