A federal judge blocked a proposed $110 billion merger between Paramount Skydance and Warner Brothers Discovery following an antitrust lawsuit filed by New York Attorney General Letitia James and eleven other states. Judge Araceli Mart\u00ednez-Olgu\u00edn issued a 14-day temporary restraining order, citing concerns over reduced competition in film, television, and streaming markets. The next court hearing is scheduled for August 3.<\/p>\n
ALBANY, N.Y. (NEXSTAR) \u2014 A federal judge issued an order on Monday stopping media conglomerates Paramount Skydance and Warner Brothers Discovery from completing a $110 billion merger. New York Attorney General Letitia James joined 11 other state attorneys general last week to file the antitrust lawsuit.<\/p>\n
\t \u201cWhen one company controls a massive share of our film and television industries, workers, artists, businesses, and consumers suffer,\u201d Attorney General James said in a statement on Monday.<\/p>\n She and the other plaintiff states filed the lawsuit under Section 7 of the Clayton Act, a federal law that\u2019s supposed to ban mergers that decrease competition. And U.S. District Judge Araceli Mart\u00ednez-Olgu\u00edn ruled from the Northern District of California that they\u2019d raised valid legal questions.<\/p>\n \t In her order, the judge affirmed that \u201clessening of competition constitutes an irreparable injury,\u201d and ruled in favor of \u201cthe public\u2019s vital interest in antitrust enforcement.\u201d Mart\u00ednez-Olgu\u00edn granted an emergency temporary restraining order that prevents the merger for 14 days while the lawsuit progresses. The next court hearing is scheduled for August 3.<\/p>\n The state attorneys asked the court to block the merger permanently. An injunction would halt the merger for the duration of the court case, while the temporary restraining order gives the judge time to consider a longer pause or permanent ban.<\/p>\n \t Under an acquisition agreement from February, Paramount offered to buy all outstanding Warner Bros. shares for $31 each. Both companies have corporate headquarters in New York, and the AG\u2019s office claims the deal directly affects local consumers and workers.<\/p>\n As argued by the AG\u2019s office in the lawsuit, the merger would reduce competition and diversity in news\u2014with CNN and CBS News under the same umbrella\u2014could raise the price of monthly TV bills and movie tickets, and reduce film production jobs statewide.<\/p>\n \t As tallied in the lawsuit, the Frankenstein entity would control two of Hollywood\u2019s five major film studios, three major streaming services (including Paramount+ and HBO Max), and over 50 basic cable channels (including HGTV, the Food Network, TNT, Nickelodeon, and MTV), alongside NFL games, Major League Baseball, and March Madness. Antitrust lawyers figured that the combined entity would control over 27% of widely-released theatrical film distributions, over 30% of the top-grossing film market, and over 27% of basic cable affiliate fees nationwide.<\/p>\n In New York, Paramount already owns and operates local CBS TV news stations. The lawsuit argued that this outsized market power will let the company score higher fees from vendors like cable distributors or concessions from theater owners\u2014like a larger portion of box office revenue, higher ticket prices, or fewer discounts. According to the lawsuit, the combined entity would pass those costs onto consumers and be more likely to threaten TV blackouts.<\/p>\n
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