UPDATE: Paramount, state AGs settle lawsuit aimed at WBD merger
UPDATE: Paramount, state AGs settle lawsuit aimed at WBD merger
The settlement removes one of the biggest remaining hurdles to the merger’s closing.
Paramount Skydance appears to have scored a major victory on Monday. After settlement talks between Paramount and 12 state attorneys general who were suing to stop the company’s merger with Warner Bros. Discovery bubbled up over the weekend, an air of uncertain optimism that a deal could quickly emerge set in. A new report from Bloomberg indicates that the states have agreed to settlement terms with Paramount, clearing a major legal hurdle for its merger with WBD.
Key Details:
- Want to make a deal?: Paramount and state AGs have reached lawsuit settlement terms.
- We disagree: A group of four attorneys general held out, but eventually capitulated.
- Still outstanding: The WGA has its own lawsuit running against the merger, as well.
Per Bloomberg’s report, Paramount has agreed to establish independent editorial boards for both CBS and CNN to appease state AGs. This was a sticking point for several of the attorneys general, who were concerned that the networks would be turned into right-wing mouthpieces by the Trump-aligned Paramount.
The deal between Paramount and the states will also establish a financial penalty if the company fails to comply with its pledge to distribute 30 films per year theatrically. Paramount may also be forced to sell its stake in Miramax as part of the agreement.
The settlement of the deal will likely head off Paramount’s threatened move out of California. Paramount began looking for potential landing spots to move to if the lawsuit had gone on unabated, and California AG Rob Bonta was almost certainly feeling the pressure of those potential job losses as he sat down at the negotiation table.
There was some dissension in the states’ ranks over the idea of making a deal with Paramount. Deadline reported that four AGs were concerned that the settlement terms were too lenient on Paramount. However, Bloomberg said that the reluctant states ultimately concluded that carrying on the lawsuit without California’s help would have become too costly.
The WGA is also suing to stop the merger, and has not been a part of the WGA talks. Guild members and others in Hollywood have been critical of any potential deal, and there are plenty of wrenches that could still be thrown into this particular machine. But Paramount has now made huge progress in getting the merger completely closed before a $7 million per day ticking fee begins to toll on Oct. 1.
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