OAKLAND, CALIF. — The U.S. District Court for the Northern District of California has given the state’s Attorney General, Rob Bonta, a boost in his quest to derail the pending merger between Paramount Skydance and Warner Bros. Discovery with the issuance of a Temporary Restraining Order.
The action, like that seen in a Sacramento federal district court, is similar to that handed to Nexstar Media Group preventing it from fully assimilating its acquired assets from TEGNA.
The key difference in the case involving the parent of CBS News & Stations is that, unlike Nexstar and TEGNA, the Paramount/WBD deal has not yet closed.
With Bonta joined by the state AGs of Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington, Judge Araceli Martinez-Olguin — as expected — issued the TRO. It freezes the $110 billion acquisition, at least for the next two weeks.
With the court hearing oral arguments on Friday (7/17), Martinez-Olguin acted swiftly with her ruling.
“Having read the papers filed by the parties and carefully considered their arguments therein and those made at the hearing, as well as the relevant legal authority, and
good cause appearing, the Court grants the motion for TRO,” she wrote.
Of concern to the state Attorneys General is what the combined entity would be comprised of — two of the “big five” film studios (Paramount Pictures and Warner Bros. Pictures), more than 50 basic cable channels spanning every major programming genre, leading premium cable television channels (HBO and Showtime), the most-watched broadcast network (CBS), three subscription streaming services (Paramount+, HBO Max, and Discovery+), and three of the most prolific television production studios (Paramount Television Studios, CBS Studios, and Warner Bros. Television Studios), as the court described the assets.
For Martinez-Olguin, the plaintiffs present “compelling evidence that the combined firm resulting from the transaction will possess substantial market share in the wide-release theatrical distribution market.”
The state AGs also make a “strong showing” that the merger will lessen competition.
This all led Martinez-Olguin to conclude that the AGs “raise serious questions on the merits of their Clayton Act claim and because the balance of equities and public interest tip sharply in favor of” the attorneys general.
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