Paramount Slams Warner Bros. Merger Massive Lawsuit: “You’re Shielding Netflix From Competition”

Paramount Skydance is pushing back against the lawsuit filed by 12 state attorneys general that aims to stop its planned takeover of Warner Bros. Discovery. The company says the legal challenge misunderstands the current entertainment market and could actually help major streaming companies like Netflix avoid stronger competition.

The response came on Monday after the coalition of state attorneys general filed a lawsuit seeking to block the $111 billion merger. According to Paramount, the case is based on an outdated view of the entertainment industry and does not reflect how competition works today.

In a statement, Paramount said the lawsuit “distorts settled antitrust law and is based on a misrepresentation of competition in the entertainment industry today.” The company added that it plans to “vigorously defend the transaction.”

Paramount argued that combining with Warner Bros. Discovery would create a stronger company that could compete more effectively against large streaming services and technology companies. The company believes the merger would help strengthen Hollywood at a time when traditional entertainment businesses are facing major changes.

The company also criticized the impact the legal challenge could have on workers in the entertainment industry. Paramount said delaying the merger would hurt employees and creators who have already faced challenges due to changes in technology and the shift toward streaming.

“The practical effect of this lawsuit is to shield those dominant streaming platforms like Netflix and technology companies from much-needed competition while preventing the significant benefits this transaction will deliver for consumers, creators, workers and the broader Hollywood economy,” Paramount said in its statement.

The company continued by saying it believes the merger would create more opportunities and help the combined company compete worldwide. “We will continue to fight against any attempt to derail a deal that strengthens competition, expands opportunity, and positions the combined company to compete in an increasingly competitive global media landscape,” Paramount said.

The merger has already received approval from regulators in several countries. Paramount says the deal has been cleared in 24 different jurisdictions, including approval from the U.S. Department of Justice in June. The DOJ did not require Paramount to sell off any assets or make additional changes before moving forward.

However, the deal is not finished yet. Regulatory reviews are still ongoing in some areas, including the United Kingdom, where officials have indicated they may take further action.

The lawsuit from the state attorneys general represents one of the biggest challenges the merger has faced. Opponents of the deal argue that combining Paramount and Warner Bros. Discovery would reduce competition and give one company too much influence over movies, television, and media.

Paramount sees the situation differently. The company argues that the merger would actually increase competition by creating a stronger rival to streaming giants and technology companies that already dominate much of the entertainment market.

Paramount Skydance is currently expecting the Warner Bros. Discovery deal to close in the third quarter of 2026. As part of its agreement, the company has committed to paying Warner Bros. Discovery shareholders an additional 25 cents per share for every quarter after September 30 if the deal is delayed. That payment could cost Paramount around $650 million in cash each quarter.

With both sides preparing for a major legal battle, the future of one of Hollywood’s biggest potential mergers remains uncertain. The outcome could have a major impact on how power is divided across the entertainment industry for years to come.

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