A US federal court in California has temporarily halted the massive $110 billion merger between media giants Paramount and Warner Bros. Discovery. On July 20, Judge Araceli Martínez-Olguín issued a preliminary ruling, finding the plaintiff states' arguments regarding potential antitrust violations sufficiently persuasive.
The lawsuit against the deal was filed on July 13 by a coalition of states led by California. According to the plaintiffs, the merger would create a media powerhouse capable of dictating and raising prices for film and television content. Meanwhile, the court rejected Paramount's argument that market competition had already been strengthened by companies like Amazon and Apple.
A separate hearing is scheduled for August 3, during which the court will determine whether to block the completion of the merger for the entire duration of the trial, which could last several months.
The court's decision was welcomed by New York Attorney General Letitia James and Senate Democratic Leader Chuck Schumer. According to Schumer, the deal poses a threat to press freedom and democracy and would negatively impact both entertainment industry workers and consumers. The politician called the merger a "gift to President Donald Trump and his major donors," who, he claimed, seek to turn one of the nation's major news networks into a mouthpiece for the MAGA movement while raising streaming costs.
Paramount stated its intention to continue defending the legality of the merger. The company emphasized that the attorneys general's antitrust claims are baseless and that their definition of market boundaries does not reflect current media industry realities.
Paramount won the bid to acquire Warner Bros. Discovery in February after Netflix withdrew from the auction and WBD's board of directors accepted a $31 per share offer (valuing the company at approximately $111 billion). This came after WBD had rejected eight previous proposals from Paramount.
The deal has already been approved by the US Department of Justice, and the regulatory review process in Europe is currently underway. Upon successful closure, the newly combined entity will include the following assets:
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