Paramount Skydance has reached an agreement with a coalition of state attorneys general to postpone the Warner Bros. Discovery merger until after an antitrust trial.
The company entered a joint stipulation in the federal case on Friday afternoon agreeing not to close the $111 billion transaction until five days after a trial is held or June 1, 2027, whichever is earlier. No trial date has been set, but the agreement likely puts the merger on hold for at least several months.
A coalition of 12 states, led by California, obtained a temporary restraining order earlier this week that blocks the merger from closing for 28 days, pending the outcome of motion for a preliminary injunction. The states allege that the deal will reduce competition in the cable and theatrical markets, and should be blocked.
“Halting this merger while our case proceeds is a critical victory in our efforts to uphold the law and protect the film and television industries,” said New York’s attorney general, Letitia James, in a statement. “I look forward to continuing our case to stop this illegal merger.”
California Attorney General Rob Bonta, meanwhile, declared the agreement a “tremendous win.”
“Our argument against this illegal merger is straightforward: When too few corporations have too much power in markets central to American life, it makes things more expensive, and it makes things worse,” he said. “Today’s agreement is great news for audiences, movie theatres, and the many people who write, build, and create the art, news, and entertainment so many of us enjoy. We are eager to continue to make our case in court and celebrate another tremendous win in our effort to ensure this unlawful merger never sees the light of day.”
Norm Eisen, co-founder of the Democracy Defenders Fund and a member of the #BlocktheMerger campaign, also hailed the agreement as a victory for grassroots opposition to the deal.
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“The Ellisons believed their relationship with President Trump would help them push through a disastrous deal that threatened democracy, creative freedom, and independent journalism. We in the #BlocktheMerger campaign helped prove them wrong,” he said. “This collective resistance is turning the tide.”
Paramount had been keen to close the deal before Sept. 30, when it will begin to incur a $7-million-a-day “ticking fee” to be paid to Warner Bros. investors. The agreement is a tacit acknowledgement that that will not happen, barring a settlement with the states.
Paramount previously sought a three-day hearing on the injunction motion in late August, hoping to win the judge’s blessing to close the deal sometime in early September.
But the states resisted that idea, saying they would need more time to take discovery and prepare for a full trial on the merits. The states were due to file their injunction motion on Thursday night, but held off as the two sides held discussions on a path forward.
In a statement, the company said the agreement is a “significant win.”
“Today’s agreement is a significant win because the result is exactly what we have sought from the outset: a direct path to a trial based on the evidence,” a Paramount spokesperson said. “This is the fastest and clearest way to prove that this transaction is good for competition, good for consumers, and good for creators, a conclusion dozens of competition authorities around the world have already reached. Plaintiffs’ market definitions bear no relationship to the realities of today’s marketplace and cannot withstand scrutiny. We look forward to proving our case at trial.”
A hearing was scheduled for Aug. 3 in federal court in Oakland, at which point the two sides were expected to argue over the injunction motion. The two sides agreed to cancel that hearing.
U.S. District Judge Araceli Martinez-Olguin approved the joint stipulation on Friday afternoon, about an hour after it was entered.
The Writers Guild of America filed its own motion for an injunction earlier this week, which was also set to be heard on Aug. 3. That motion has been withdrawn, as Paramount has effectively conceded that it will not close the deal until a determination of the merits of the antitrust claims.
The parties also agreed to submit a joint stipulation by July 31 on their respective positions on trial scheduling. The states previously proposed to hold the trial in April 2027.
From Variety US