Paramount nears merger settlement, but some key state AGs are not on board yet

Paramount’s Merger Talks Face Resistance From Several State Attorneys General

Earthguardiansonline.com – Paramount is working toward a possible settlement with the state attorneys general who sued to stop its proposed acquisition of Warner Bros. Discovery, but the negotiations have exposed disagreements inside the coalition challenging the transaction.

California Attorney General Rob Bonta, who has led the 12-state group since it filed the antitrust case two months ago, has pushed in recent days for a deal with Paramount. Yet several states remain unconvinced that the terms under discussion would sufficiently protect workers, competition and the independence of major news organizations.

New York Attorney General Letitia James has sought stronger safeguards for employees affected by the combination of the two media companies. Connecticut Attorney General William Tong and at least two additional states also have reservations and have not joined a potential agreement. The states holding out are pressing Paramount for further remedies before giving their approval.

A High-Stakes Deadline for the Media Deal

The dispute carries significant consequences for a transaction that would reshape the entertainment industry. A combined Paramount and Warner Bros. Discovery would bring together movie studios, television networks, streaming assets and the news operations of CBS News and CNN.

If the parties cannot reach a settlement, the antitrust lawsuit is scheduled for trial in California next March. That timetable could create a lengthy delay for the acquisition and may put the broader transaction at risk.

People familiar with the confidential discussions say Tong has focused on protecting the editorial independence of CNN and CBS News. His concerns reflect a larger debate over whether commitments made during merger negotiations can adequately address the effects of consolidating influential media businesses under one corporate structure.

Potential concessions discussed in connection with a settlement include independent oversight of CNN content, commitments involving theatrical film releases and a temporary separation of the two studios’ operations. Bonta has also said that any resolution should include structural remedies, potentially including divestitures of cable channels rather than relying solely on voluntary promises.

“We, respectfully, didn’t think the United States DOJ did an adequate review and we thought we needed to step into that breach,” Bonta said Thursday at The Atlantic Festival.

Paramount’s proposed purchase was reviewed by the Justice Department, which allowed the deal to move forward without requiring concessions in June. The state lawsuit followed, reflecting the attorneys general’s view that further scrutiny was needed.

Workers and Local Production Remain Central Issues

The negotiations are unfolding as several of the attorneys general involved face reelection campaigns in November. That political context adds pressure to a case with direct implications for thousands of media workers.

James represents New Yorkers employed by Paramount and Warner, and her office has contacted at least six unions affected by the proposed merger during settlement discussions. The concern is not limited to corporate ownership; it also involves jobs, labor representation and the future location of film and television production.

Bonta has faced pressure from allies and local officials over the possibility that Paramount could reduce its presence in California. Los Angeles Mayor Karen Bass, who is also in a competitive reelection race, publicly emphasized the importance of retaining film and television production in the city.

“I’m going to fight like hell” to keep film and TV production in the city, Bass said last week.

California’s role in the negotiations is especially consequential because of its importance to the entertainment economy. A merger of this scale could influence decisions about where productions are made, which facilities remain active and how many companies compete for creative talent and distribution.

Opponents Demand More Than Voluntary Promises

News of possible settlement terms has alarmed groups that want the transaction blocked rather than resolved through conditions. The Block the Merger Coalition, which includes Hollywood unions and advocacy organizations, has scheduled demonstrations outside Bonta’s Los Angeles office, James’ New York office and the Writers Guild of America West headquarters in Los Angeles.

The coalition argues that promises from Paramount would not offer meaningful protection unless they can be enforced clearly and last beyond the immediate period after the deal closes. Its objections have intensified scrutiny of Bonta’s willingness to negotiate.

“An agreement based only on unenforceable concessions is a win only for David Ellison,” the coalition said. “It is an L for everyone else.”

Paramount CEO David Ellison and his father, Oracle Executive Chairman Larry Ellison, have also drawn attention from merger critics. Larry Ellison has long been allied with President Trump, while David Ellison has developed ties with the Trump White House as Paramount pursues a larger role in global media.

The unresolved question is whether the states can agree on protections strong enough to resolve their challenge. For Bonta and other attorneys general, the negotiations will test whether a settlement can preserve competition and newsroom independence while addressing the economic stakes for workers and production communities. If the coalition remains divided, the fight over one of Hollywood’s largest proposed combinations may instead move toward a courtroom battle next spring.