Paramount is asking a federal court to require a $1.88 billion bond from a coalition of state attorneys general and the Writers Guild of America seeking to block its proposed merger with Warner Bros. Discovery. The request follows reply briefs filed “on Tuesday” and a company press release describing the lawsuits as the “only remaining barrier to closing this transaction,” according to reporting by The Center Square and Paramount’s press materials.
Who is suing — and why
California Attorney General Rob Bonta is leading a group of Democratic attorneys general from Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington, along with the Writers Guild of America, in a lawsuit citing antitrust concerns, The Center Square reported.
Bonta’s media office told The Center Square: “Our office believes Paramount’s motion has no merit, and we look forward to presenting our case in court at the September 24th hearing.” The office added that “the proposed Warner Bros./Paramount merger would combine two Hollywood titans and extinguish competition between them.” According to Bonta’s office, the merger “is illegal under long-standing federal antitrust law, would create a troubling level of concentration in three markets, and will mean less competition, higher costs for consumers, lower wages, job cuts, and fewer movies and TV shows.”
Paramount’s bond push
Paramount’s press release said the company filed reply briefs “in support of its request that the State Attorneys General and the Writers Guild of America post a bond in connection with their lawsuit.” In a statement, a Paramount spokesman said: “If plaintiffs insist that this transaction is paused during the pendency of their lawsuit, they must accept the financial consequences if their challenge ultimately fails.”
“But for these lawsuits, the transaction is now otherwise ready to close, and the resulting costs of delay are substantial and quantifiable,” the spokesman said, adding: “The Clayton Act and Rule 65 provide for a bond precisely to protect against exactly those types of losses if a court determines an injunction ultimately is unwarranted.”
Outside criticism of the suit
Ashley Baker, executive director of the Committee for Justice, told The Center Square that “forcing taxpayers to foot the bill for a $1.88 billion bond request for a politically-motivated lawsuit is irresponsible, even for a radical attorney general like Rob Bonta.” Baker also asserted that “the merger was already cleared by the Department of Justice,” and claimed that “Bonta’s political allies like Gavin Newsom, Karen Bass, and Xavier Becerra oppose what he’s doing,” adding that opposition “continues to grow by the day.”
“Just last week, Democrat elected officials from New Jersey joined the opposition to Bonta’s lawsuit and expressed concerns that their constituents could be responsible for covering the $7 million per day tab,” Baker said. She added, “Each of the attorneys general who signed onto Bonta’s lawsuit should be forced to answer why they would expose their constituents to that kind of financial risk.”
What’s next
Bonta’s office told The Center Square a hearing on Paramount’s motion is set for Sept. 24. Paramount’s spokesman said the company is confident the lawsuits are meritless and that it looks forward to closing the transaction and “delivering its benefits in California, across the United States, and around the world.”
