Paramount’s Acquisition Of Warner Bros. Discovery Update – Court Hearing Set for State Attorneys Lawsuit Against Paramount, Writers Guild of America Also Files Lawsuit Trying To Block Acquisition Deal

As noted before, Warner Bros Discovery announced this past April that their shareholders had voted in approval of Paramount Skydance’s acquisition deal for the company. The United States Department of Justice officially approved Paramount’s acquisition deal for WBD this past June. Several state attorneys filed a joint lawsuit on Monday against Paramount to try to prevent the acquisition deal. WBD is the current media broadcast partner of AEW.

PWInsider’s Mike Johnson reported that a federal judge has scheduled a court hearing for Friday, July 17 on an emergency request from a group of state attorneys seeking to block Paramount’s acquisition and merger deal with WBD.

Johnson reported that the state attorneys are asking the court to issue a temporary restraining order that would pause the transaction deal while their antitrust lawsuit moves forward.

Johnson also reported that Paramount has been ordered by the court to file its opposition to the temporary restraining order by this Thursday.

Besides the state attorneys, the Writer’s Guild of America also has filed a lawsuit on Tuesday against Paramount to block their acquisition and merger deal with WBD.

In their filing, the WGA claims that this merger deal violated federal antitrust laws and would cause specific harm to writers if allowed to go through.

Official press release:

WGA Files Lawsuit to Block Paramount-Warner Bros. Discovery Merger

Los Angeles and New York – Today, the Writers Guild of America West and Writers Guild of America East (jointly WGA), filed suit to block the proposed merger of Paramount Skydance and Warner Bros. Discovery on the grounds that it violates federal antitrust law and would cause specific harm to writers.

“With fewer competitors, the merged Paramount-Warner Bros. entity would have both the incentive and the ability to lower costs by suppressing writers’ wages and reducing output. Writers will be paid less and have fewer employment opportunities,” the WGA complaint states.

The complaint details how the merger would reduce opportunities, lower pay and worsen working conditions for writers. The elimination of a key competitor and the creation of a new dominant firm would result in reduction in the quantity and variety of theatrical films and television series as the merged company would have a greater ability to reduce output. Furthermore, the complaint asserts that the merger would increase the ability for the few remaining companies to tacitly coordinate to further suppress competition for writers’ work.

“If Paramount succeeds in buying Warner Bros., the merged firm will be the largest buyer of original film and television programming in the United States,” said WGAW President Michele Mulroney. “This would eliminate competition in an already consolidated industry, threatening the livelihoods of entertainment workers and the creative diversity of TV and film. We applaud the dozen state Attorneys General who have stepped up to enforce our antitrust laws and are proud to file suit alongside them.”

Since Paramount’s proposed acquisition of Warner Bros. Discovery was announced, the WGA has raised awareness about this threat to State Attorney General offices and federal legislators, submitted comments to regulatory agencies and Congress, and participated in press events as part of a coalition of democracy and arts organizations.

The WGA complaint focuses on the anticompetitive effects of the merger in three markets for writing services: anticipated top grossing films, episodic television and streaming series, and overall deals.  

“The Writers Guild of America will not stand idly by as Paramount attempts to violate our country’s antitrust laws and deepen the contraction entertainment workers already feel,” said WGAE President Tom Fontana. “This proposed combined entity would be the largest employer of writers, with tremendous power to suppress our wages, eliminate opportunities for emerging writers, cut jobs across the industry, and produce less programming, effecting the range of storytelling. This merger is not inevitable and we are fighting to stop it.”

The WGA is represented in this lawsuit by Shinder Cantor Lerner LLP, Cuneo Gilbert Flannery & LaDuca, LLP, and Platkin LLP. The lawsuit was filed in the United States District Court for the Northern District of California.

Read the WGA full complaint.

See the fact sheet for more on the lawsuit.

The WGA has also publicly opposed the recent mergers of Disney-Fox, Amazon-MGM, AT&T-Time Warner, and Comcast-Time Warner Cable, among others.