A dozen state attorneys general have filed an antitrust lawsuit to block the proposed merger between Paramount and Warner Bros. Discovery (WBD), valued at $111 billion. The lawsuit was filed in the US District Court for the Northern District of California, a month after the Department of Justice approved the merger in June.
The attorneys general from Arizona, California, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington allege that the merger violates the Clayton Act by diminishing competition in the distribution of wide-release theatrical films and the licensing of basic cable channels to distributors. The suit specifically notes that Paramount’s acquisition of WBD would likely harm competition across various sectors.
California Attorney General Rob Bonta stated, “The unlawful merger of these two entertainment behemoths would lead to higher prices, lower quality and less content for film and television.” Bonta highlighted concerns that consolidation would adversely affect audiences and diminish opportunities for diverse storytelling.
The combined entity of Paramount and WBD could control a 27 percent share of the wide-release theatrical distribution market, according to Bonta’s office. The merger is projected to give the new company control over three-tenths of the anticipated top-grossing theatrical films. In the basic cable market, the firms would also have a 27 percent market share, with WBD currently the second-largest player and Paramount in third place.
A spokesperson for Paramount criticized the lawsuit, labeling it as a flawed interpretation of antitrust laws. The spokesperson said, “We will vigorously defend the transaction and demonstrate that this challenge is inconsistent with sound competition policy.” They argued that the merger would create a more robust media company, enhancing competitive positioning against firms like Netflix.
Paramount CEO David Ellison stated that the merged company would commit to releasing at least 30 films per year and would improve competition in the streaming sector. As of March, WBD reported over 140 million streaming subscribers globally, while Paramount+ had 79.6 million. By the end of 2025, Disney+ and Hulu had a combined 183 million subscribers, with Netflix surpassing 325 million paid members.
The state attorneys general are expected to seek an injunction to prevent the deal from finalizing. Paramount and WBD still require regulatory approval in other jurisdictions. The European Union indicated that Paramount has made concessions to secure approval, with a decision deadline set for July 22. Additionally, the UK’s Competition and Markets Authority has opened an investigation into the merger.
