Paramount’s $111 billion merger with Warner Bros. Discovery is poised to close after a federal judge approved a settlement resolving the antitrust lawsuit brought by 12 Democratic state attorneys general.
U.S. District Judge Araceli Martínez-Olguín signed off on the consent decree Wednesday, removing the final remaining barrier to the debt-fueled transaction. Paramount has tentatively scheduled the merger to close Tuesday, Oct. 6, according to regulatory filings.
The ruling puts Paramount chief David Ellison on the verge of completing the most expensive takeover in Hollywood history following a fierce, year-long battle. Regulators in 68 jurisdictions worldwide, including the Justice Department, had already cleared the deal.
In her order, Martínez-Olguín concluded that the proposed consent decree represented “a reasonable factual and legal resolution of the dispute” and “reflects a procedurally sound resolution.”
“The parties reached their agreement following highly contested, however brief, litigation, and they reached their agreement following what they report to have been several rounds of in-depth negotiations,” the judge wrote.
Settlement Sets Production and Release Requirements
The settlement does not include the structural remedies, such as divestitures, that California Attorney General Rob Bonta had previously sought. Bonta led the coalition of states that sued to stop the merger.
Instead, the consent decree imposes a series of operational commitments on the combined company. Paramount-WBD will be barred from selling the Paramount Studios or Warner Bros. lots for at least five years and must invest at least an additional $300 million annually in U.S. film production.
The merged company also must release at least 30 films theatrically during its first two years, followed by at least 32 movies across years three through five. Wide-release films will be required to receive a 45-day theatrical window. Ellison has repeatedly promised to meet the initial 30-film commitment.
A “news editorial independence board” will monitor the combined business and establish guiding editorial and journalism principles for CNN and CBS News.
The judge said the agreement also contains significant enforcement mechanisms, including potential divestitures of studios and/or cable channels if the company does not comply.
Martínez-Olguín found that the decree’s requirements governing film distribution and basic-cable negotiations offered “a fair, reasonable, and good faith approach” to addressing the alleged competitive harms without violating the law or public policy.
Opponents Had Pushed for More
The approval followed formal objections from merger critics. The groups behind the #BlockTheMerger coalition submitted an amicus brief urging the court to reject the settlement. The League of United Latin American Citizens also objected, arguing that one combined company could potentially invest less in productions about Black and Latino communities than two competing studios would.
Sen. Cory Booker of New Jersey separately asked the court to subject the proposed decree to an independent public-interest review. Paramount and the state attorneys general opposed that request in filings Monday, maintaining that their agreement had been vigorously negotiated, had “teeth” and addressed the states’ central concern about a potential reduction in theatrical releases.
During questioning last week, Paula Blizzard, senior assistant attorney general for the antitrust section of the California Attorney General’s Office, addressed how the settlement responds to concerns involving wide-release movies, tentpole films and basic cable.
Blizzard said the states were wary of permanently blocking the transaction because Warner Bros. Discovery would likely seek another merger-and-acquisition partner if it could not combine with Paramount. She described the decree as an instance in which remedies could address perceived harm without requiring the merger to be blocked or the companies to divest assets.
Martínez-Olguín acknowledged that opponents had expressed dismay over several provisions. She also cited Booker’s reference to Connecticut Attorney General William Tong’s statement that his state had sought the full divestiture of CNN and CBS News and was “deeply disappointed” the agreement did not go further.
Still, the judge determined that those demands did not establish legal grounds for rejecting the negotiated resolution. She characterized the decree as a compromise that may disappoint both sides and members of the public but avoids the risk, time and expense of taking the case through trial.
A New Entertainment Giant Takes Shape
If the merger closes as planned, the company will combine two major movie studios, the HBO Max and Paramount+ streaming platforms and television businesses including CBS, CNN, MTV, TBS, Comedy Central and Food Network.
Its entertainment properties will span Harry Potter, “Game of Thrones” and other HBO titles, the DC Universe, “Yellowstone,” “Mission: Impossible,” “Top Gun” and Nickelodeon’s children’s business. The name of the combined company has not yet been revealed.
Its senior leadership is already beginning to take shape. Ellison has recruited Ynon Kreiz, who is stepping down as Mattel CEO, for a senior management position at Paramount-WBD.
Casey Bloys, who leads WBD’s HBO, is poised to oversee the combined streaming operation. That development follows Cindy Holland’s announcement Tuesday that she was leaving her role overseeing Paramount+ and other direct-to-consumer operations.
Warner Bros. Discovery CEO David Zaslav is expected to depart once the merger closes. He stands to receive more than $550 million in stock and cash, including $34.2 million in cash severance payments. WBD chief revenue and strategy officer Bruce Campbell and CFO Gunnar Wiedenfels are also anticipated to exit.
What Happens Next?
With the court’s approval secured, Paramount is working toward its tentative Oct. 6 closing date. Completion would formally bring the studios, streaming services, television networks and franchise portfolios under one company while activating the production, theatrical-release and editorial-oversight commitments established in the settlement.