Paramount’s Warner Bros. Deal Hits a Fresh Speed Bump as a Judge Lets Merger Foes Weigh In

The fight over Hollywood’s biggest merger in years has been a long, twisting saga, and just when it looked ready to wrap up, it found another turn. The proposed combination of Paramount Skydance and Warner Bros. Discovery has faced lawsuits, restraining orders, a costly countdown and a last-minute settlement. Now a ruling from the judge overseeing the case is set to slow down the finish line.

The deal is valued at about $110 billion and would bring together two storied film studios, CBS, CNN, and the streaming services Paramount+ and HBO Max. A coalition of 12 state attorneys general led by California’s Rob Bonta sued to block it on July 13. Judge Araceli Martinez-Olguin granted a temporary restraining order in July, and Paramount then agreed to pause the transaction until a trial or June 1, 2027, whichever came first.

The pressure on the company grew from there. Under the merger terms, Paramount was required to pay WBD shareholders an additional $7 million a day starting October 1 on top of the $81 billion it agreed to pay, and CNBC estimated the ticking fee at roughly $650 million per quarter. Paramount also asked the judge to force the states and the Writers Guild of America to post a $1.88 billion bond, a request that was later mooted.

On Monday, Paramount reached a settlement with the 12 attorneys general, and the WGA settled its own suit shortly after. The proposed consent decree requires Paramount to keep the Paramount Studios and Warner Bros. lots in California for at least five years, invest an additional $300 million a year in US film production, and release at least 30 movies per year in theaters. It also creates an independent board to oversee editorial independence at CNN and CBS News.

Bonta said the settlement isn’t a vote of support for the merger, and sources told Variety it doesn’t require any major divestitures. Critics of the deal accused him of caving, and some of the other attorneys general were disappointed by the outcome.

The consent decree still needs the judge’s approval, and CEO David Ellison told staff he expected the deal to close in about two weeks. Then came Thursday’s twist. Hours before an 11 a.m. PT hearing widely viewed as a likely rubber stamp, the judge granted a motion from the Block the Merger coalition to set a schedule for amicus briefs on the proposed consent decree.

The judge’s order says amicus briefs must be filed by 12:01 a.m. PST on September 25, and that the deadline will not be extended. Deadline reported that the ruling makes it almost certain the deal won’t be formally approved on Thursday, and it could mean an expensive delay in the closing.

Paramount and WBD had opposed the move. They argued that letting non-parties delay the closing, without filing their own antitrust action, meeting the Clayton Act’s standard for an injunction or posting a bond, would be improper. The judge nonetheless allowed the briefs, and she had already said she had outstanding questions about the factual and legal underpinnings of the decree.

That doesn’t mean the deal is dead. Bonta’s office said it isn’t uncommon for a court not to approve a settlement immediately, and the deal has already received regulatory approvals in more than 65 nations. The FCC has also approved a foreign ownership structure for the combined company.

The stakes reach well beyond the boardroom. The merger has drawn opposition from the Writers Guild, which said it continues to believe the deal will damage writers and the industry, and from open letters signed by actors, directors, producers and crew. Supporters, including Paramount, argue the combination will create more content and help the company compete with giants like Netflix and Amazon.

If the deal closes, Ellison’s empire would include two major movie studios, two global streamers and two major news networks, according to Axios. That is why every court filing is being treated as a sign of how quickly the transformation could happen.

For now, the calendar is the main unknown. The amicus deadline arrives overnight, and it will take more time for the judge to weigh those arguments.

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