Paramount Skydance

Paramount Skydance’s quest to take over Warner Bros. Discovery suffered a series of potential legal setbacks this week, with California and 11 other state attorneys general filing an antitrust lawsuit seeking to block the $111 billion Hollywood studio merger. On Monday, California Attorney General Rob Bonta and the other attorneys general also requested both a temporary restraining orde r to immediately freeze the merger and a preliminary injunction that could put the sale on hold for months while the case is decided. S. Department of Justice cleared the proposed deal.

S. District Court for the Northern District of California. The suit alleges that the proposed merger violates the Clayton Antitrust Act. The law holds that mergers that may substantially lessen competition or tend to create a monopoly are illegal. Speaking at a news conference with an image of the iconic Hollywood Sign as a backdrop, Bonta said that the proposed acquisition, the largest in Hollywood history, would create a monopoly. “There is no debate here. This proposed merger would snuff out competition, drive up prices, diminish content quality, and produce fewer movies and shows each year,” Bonta said.

A combined Paramount-Warner entity would own a portfolio of cherished film classics and blockbuster movies such as Harry Potter, The Godfather, and Casablanca , as well as some of the nation’s best-known television programming and content— CNN, HGTV, CBS and Major League Baseball, among them. Paramount Skydance and Warner Bros. Discovery comprise two of the five major Hollywood film distributors and major cable channel owners. ,” Bonta stated in a news release posted earlier in the day. Paramount Skydance , headed by CEO David Ellison, swiftly responded, vowing to defend the transaction vigorously.

“The lawsuit filed by the state attorneys general…reflects a fundamentally flawed application of the antitrust laws and is wrong on both the facts and the law,” the statement reads. “Delaying this transaction will only harm entertainment workers who have already suffered over recent years as technology has disrupted their livelihood and cost California tens of thousands of entertainment jobs,” the response continues. Despite Paramount’s pushback, critics of the mega-merger applauded California’s legal challenge, which has garnered national support.

Attorneys general from Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington also joined the lawsuit. The fear of a negative impact on local economies and job loss has been at the forefront of opposition to the merger. The Hollywood strikes of 2023 hit Southern California particularly hard. A. area declined by roughly 13 percent in the past year. In addition, an estimated 42,000 jobs in the motion picture industry were lost between 2022 and 2024. “A merger this size, in an industry that has already lost thousands of California jobs to consolidation, deserves a full examination on the merits,” Congresswoman Laura Friedman (CA-30) said this week .

In a May 7, 2026, letter, Friedman, a former film and TV producer, led 34 California Members of Congress in expressing support for Attorney General Bonta’s commitment to conduct a “full and robust review” of the deal. The proposed acquisition of Warner Bros. Discovery has dominated entertainment news worldwide this year. , which ended with Netflix bowing out due to cost. Since then, many have questioned how Paramount plans to manage the projected $6 billion in expense reductions it has said it will likely have to make over three years. With analysts predicting significant job losses, many writers, actors, directors, and others have voiced serious concern.

On Tuesday, the Writers Guild of America East and Wes t filed the union’s own antitrust lawsuit against the merger in San Francisco federal court. The WGA, which represents 18,000 members and has been particularly vocal in its opposition to the deal, claims that, with fewer competitors, a merged Paramount-Warner Bros. would be able to lower costs by reducing wages and positions. “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 WGAE President Tom Fontana.

“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, [impacting] the range of storytelling,” Fontana stated. Paramount had this response to the second lawsuit. ” “ [T]he combined company will have no incentive to shrink the production engine that drives its competitiveness,” Paramount has further stated. This week’s legal action comes after the United States Department of Justice’s Antitrust Division closed its investigation into the merger of Paramount Skydance and Warner Bros.

Discovery in mid June. The agency determined “that the transaction is not likely to result in harm to competition or American consumers…” Internationally, Paramount said that the deal has been cleared in at least 20 countries, including Australia, China and Saudi Arabia. At the moment, the legality of the venture is still being decided by the European Commission and the United Kingdom. With the deadline to finalize the deal with Warner Bros.