12 states sue to block Paramount’s $110B Warner Bros deal

A conjugation of 12 authorities attorneys wide is filing a lawsuit to artifact the merger of Paramount Skydance and Warner Bros. Discovery (WBD), alleging that the woody would harm movie theaters, basal cablegram distributors, and audiences.

The coalition, led by California Attorney General Rob Bonta, argues that the acquisition violates the Clayton Act, which prohibits mergers that whitethorn substantially lessen contention oregon thin to make a monopoly. The attorneys wide allege that if the 2 companies are allowed to merge, it would lessen contention successful 3 areas: wide merchandise theatrical movie distribution, “top-grossing” theatrical distribution, and basal cablegram licensing.

The woody would harvester 2 notable movie studios arsenic good arsenic streaming platforms Paramount+ and HBO Max. It would besides make 1 of the largest portfolios of tv networks, bringing unneurotic Paramount’s CBS and MTV with WBD’s CNN and HBO.

The projected acquisition has already received scrutiny from filmmakers, actors and manufacture professionals who person argued that the woody would trim contention and further consolidate the U.S. media industry. Paramount has argued against this, saying the combined movie studios ​would merchandise 30 ​movies a year.

The states reason that, if approved, the woody would springiness Paramount important power implicit cardinal areas of the amusement industry, including 27% of the U.S. movie organisation market, 30% of blockbuster movie distribution, and 27% of the basal cablegram transmission market.

“Consolidation present not lone leads to higher prices — it besides leads to less opportunities for important stories to travel to life, and less ways for audiences to brushwood stories, ideas, and perspectives beyond their ain experiences,” Bonta said successful a statement. “In this country, nary 1 is supra the law. With this lawsuit, California and our sister states are warring for escaped and just markets, not rigged markets. America has nary kings successful authorities oregon our economy.”

Paramount CEO David Ellison had said successful May that the transaction was connected way to adjacent the woody by September. The woody received support from WBD shareholders successful April, and has been cleared by the U.S. Department of Justice, which said the transaction is not apt to effect successful harm to contention oregon consumers.

The 11 states joining California are Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington.

Paramount and WBD did not instantly respond to TechCrunch’s requests for comment.