Paramount, California settlement talks accelerate, potentially moving Warner Bros. merger closer
After a bitter standoff, Paramount Skydance and California Atty. Gen. Rob Bonta have made progress in settlement talks that could push Hollywood’s massive merger over the finish line, people familiar with the matter said Friday.
The two sides have quietly been negotiating a truce to end the antitrust lawsuit brought by Bonta and 11 other Democratic state attorneys general — a legal volley that has threatened to derail Paramount’s $111-billion takeover of Warner Bros. Discovery.
It’s not clear how close to a resolution the two sides are, but talks in recent days have been constructive, one of the knowledgeable sources said.
Paramount Chief Executive David Ellison is highly motivated to end the court battle with Bonta before Oct. 1, when his company will be obligated to make a higher payout — an extra $7 million a day — to Warner Bros. Discovery shareholders on top of the $81 billion the company has already agreed to pay.
For weeks, Ellison and his team have been ratcheting up political heat on Bonta to abandon his lawsuit, including threatening to pull Paramount out of Hollywood — a scenario that has rattled state and local lawmakers who desperately want to bring film jobs back to Los Angeles, not lose thousands more.
Paramount declined to comment.
A spokesperson for Bonta’s office said in a statement: “Potential settlement talks are confidential. We cannot confirm or deny whether settlement talks are occurring or their alleged substance.”
Both sides have incentives to settle. Ellison, who has leaned on his family’s connections to President Trump and Washington Republicans, would like to avoid taking on more debt for the already highly leveraged deal. And he is eager to close the transaction and take the reins at Warner Bros. before the midterm elections.
Bonta has been on a winning streak with favorable rulings against the Trump administration and social media giant Meta, and he doesn’t want to overplay his hand or risk having his coalition of state attorneys fall apart.
Earlier this week, the two sides agreed to sit down for court-mandated settlement talks in mid-October. The two sides were set to meet in late August but Bonta pulled the plug on those sessions, accusing Paramount of leaking misinformation and “playing games.”
The Wall Street Journal first reported the two sides were in advanced talks.
This is a developing story.