paramount skydance Representatives are reportedly meeting with the California Attorney General’s Office on Monday to discuss a path toward settling an antitrust lawsuit seeking to block Paramount’s acquisition. warner bros discoveryThe New York Times reported on Saturday.
Pressure to settle the lawsuit has increased in recent weeks, with California Governor Gavin Newsom, Los Angeles Mayor Karen Bass, the Directors Guild of America and others seeking a settlement. However, the Times reported, citing people briefed on the upcoming talks, that there is no guarantee that this series of talks will lead to meaningful negotiations toward a settlement.
On Thursday, California Attorney General Rob Bonta told CNBC’s David Faber that the deal would require “strong structural remedies” to reach a settlement in the antitrust case.
“[Paramount]wanted to talk about everything other than what’s in this lawsuit. They want to talk about the streaming market, which we don’t allege in the complaint. They want to talk about CNN, but that’s not the focus of our complaint. They want to talk about foreign regulators. We want to talk about the three markets where we believe there are antitrust violations listed in the complaint,” Bonta said on CNBC.
A group of 12 state attorneys general filed a lawsuit in July challenging the proposed $110 billion acquisition that would combine Paramount and Warner Bros., two of the oldest movie studios, with streaming platforms Paramount+ and HBO Max. Partnership could create the largest portfolio of television networks in the U.S.
“The illegal merger of these two entertainment giants will lead to higher prices, lower quality, and less content for movies and television, harming movie theaters, basic cable distribution companies, and ultimately the audience on every couch and movie theater seat in America,” Bonta said in a release announcing the lawsuit.
Paramount previously agreed to delay the deal until June 2027 due to legal challenges, with a trial scheduled for March. However, if the deal is delayed beyond September 30, Paramount will pay Warner Bros. Discovery shareholders a quarterly “ticking fee” that could amount to about $650 million in cash, according to a previous CNBC report. If the deal falls apart completely, Paramount would be obligated to pay WBD a $7 billion penalty.
In June, the U.S. Department of Justice’s Antitrust Division approved the proposed merger. European antitrust regulators also approved the deal in July.
But U.S. state officials, the Writers Guild of America and prominent Hollywood actors and actresses argue that the merger would not only reduce competition but also lead to job losses in the entertainment industry.
Read the full New York Times article here.
—CNBC’s Lillian Rizzo contributed to this report.
