Paramount Skydance settles with 12 state AGs, clearing $110bn Warner Bros. merger
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Paramount Skydance reached a settlement with 12 state attorneys general, allowing its $110 billion acquisition of Warner Bros. Discovery to proceed. The agreement includes a $30 million penalty per film if the studio fails to release 30 movies annually in theaters. The deal is expected to close by Sept. 30.
Key Facts
- The settlement includes a $30 million penalty per film if Paramount Skydance releases fewer than 30 movies annually in theaters.
- The lawsuit was brought by 12 state attorneys general, led by California's Rob Bonta, and the Writers Guild.
- Paramount Skydance's merger with Warner Bros. Discovery is valued at $110 billion.
- The settlement requires independent editorial boards for CNN and CBS.
- Paramount had told investors it expected to close the deal by Sept. 30.
Settlement Terms
Paramount Skydance reached a settlement with 12 state attorneys general, allowing its $110 billion acquisition of Warner Bros. Discovery to proceed. The agreement includes a $30 million penalty per film if the studio fails to release 30 movies annually in theaters. Sources told Reuters that the settlement also requires independent editorial boards for CNN and CBS. Paramount had told investors it expected to close the deal by Sept. 30.
Antitrust Challenge
The lawsuit was brought by a group led by California Attorney General Rob Bonta, joined by the Writers Guild. The attorneys general argued the merger would create a monopoly capable of crushing competition and dictating prices to cable networks. The case was previously set to head to trial in March and would have left the deal in limbo through mid-2027. Several states refused to accept a neutral editorial controller at CNN, demanding the outright sale of the news channel.
Theatrical Release Commitment
The commitment to release 30 films per year in theaters was initially made to appease major cinema chains and gain their political support. California Attorney General Rob Bonta repeatedly stated that such commitments are historically impossible to enforce once a merger is signed. To reach the 30-film target without exploding production costs, Paramount negotiated the possibility of including films produced by third-party studios but distributed under its banner. The $30 million per missing title penalty creates an unprecedented enforcement mechanism.
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