Tensions flared on the eve of a critical week ahead for Paramount Skydance’s proposed $111-billion acquisition of Warner Bros. Discovery, amid new urgency for talks aimed at settling antitrust litigation brought by California Atty. Rob Bonta and 11 other states.
Over the weekend, opposition intensified to a proposed settlement as details trickled out, including a proposal to establish a bipartisan editorial board to monitor cable news channel CNN, one of Warner’s premier properties that Paramount Chief Executive David Ellison would control along with CBS News. It wasn’t clear Sunday whether a proposed settlement would require Warner to sell off assets — something Bonta repeatedly has insisted upon. Critics of the deal urged Bonta and other state attorneys general to resist pressure to reach a settlement that would allow Ellison’s deal to move forward.
Jamie Raskin (D-Md.) wrote on social media late Saturday. California must not cave and take a deal that leaves both under the same owner,” Rep. Ro Khanna (D-Fremont) wrote.
Bonta and Ellison have made progress in the talks in recent days, according to four people familiar with the matter not authorized to speak publicly. However, New York’s Letitia James and at least two other attorneys general who joined Bonta’s lawsuit in July privately have expressed reservations about the proposed compromises, believing they don’t go far enough to mitigate concerns about the power Paramount-Warner Bros. would wield over the film and TV industries should the merger go through, according to the people familiar with the matter. James isn’t on board with Bonta’s proposed settlement, two of the people said.
A potential split within Bonta’s coalition could be a setback because Bonta needs the other state attorneys general who joined his legal effort to sign off on any deal. A spokesperson for Bonta did not respond Sunday to a request for comment. Paramount maintains its deal to bring HBO, CNN, CBS, TBS, Comedy Central and two legendary film and television studios together would create a stronger company that could withstand the fierce competition from tech giants such as Apple, Google (which owns YouTube) and Amazon.
The two studios, on their own, would not be strong enough on their own to remain viable in the streaming age, the company has said. On Thursday, Paramount lawyers plan to demand that U.S. District Judge Araceli Martínez-Olguín in Oakland require the states and the Writers Guild of America to post a $1.88-billion bond that would cover some of Paramount’s delay-related deal costs should the company eventually prevail.
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