A federal judge in Oakland has blocked one of the biggest media mergers in Hollywood history, issuing a temporary restraining order against Paramount Skydance's $110–111 billion acquisition of Warner Bros. Discovery.
The two-week pause comes after California Attorney General Rob Bonta and a coalition of 11 other states sued to stop the deal, claiming it would harm competition, raise prices, and reduce choices for movie theaters and streaming customers.
The coalition of states includes Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington. The judge sided with the states, citing "compelling evidence" on market share.
A hearing on a longer injunction is set for August 3 in Oakland, which could put Paramount at risk of missing its September closing deadline and triggering penalties.
The coalition of states claims the merger would create an entertainment giant with excessive market power, leading to higher prices, fewer choices for consumers, and reduced competition in film distribution and cable television.
Paramount has rejected those claims, arguing that the lawsuit relies on an outdated view of the modern media landscape and ignores intense competition from streaming giants such as Netflix and Disney.
The legal challenge represents the most significant obstacle yet to Paramount's effort to combine with Warner Bros. Discovery, unifying major brands including CBS, Paramount Pictures, Warner Bros., HBO, CNN, Paramount+, HBO Max, and numerous cable networks under a single corporate umbrella.
Paramount's CEO, David Ellison, was already considering relocating the company's headquarters outside of California due to the lawsuit, with advisers urging him to reallocate tens of billions in planned spending outside the Golden State.
The deal, which would have created an entertainment giant, had already cleared multiple international regulators and the U.S. Department of Justice under the Trump administration.
