Judge Questions Settlement Allowing Paramount and Warner Bros. Merger

U.S. District Judge Araceli Martínez-Olguín held a virtual hearing on Thursday to question a proposed settlement between Paramount and 12 state attorneys general regarding its merger with Warner Bros. Discovery and Skydance Media. The judge stated the court is not a "rubber stamp" and sought assurance that the agreement was an arm's length process rather than collusion.

The settlement, led by California Attorney General Rob Bonta, allows the merger to proceed provided the new entity invests $1.5 billion in U.S. film production over five years and maintains theatrical release quotas. Failure to meet these requirements could force the divestiture of Miramax Studios. To protect editorial independence at CNN and CBS News, the companies agreed to an editorial board structure enforceable under a consent decree.

Connecticut Attorney General William Tong, who previously led a coalition demanding the divestiture of news assets, signed the settlement after stating he was "outnumbered." Tong warned that the resulting market concentration would lead to higher streaming and cable prices for consumers. Senator Cory Booker has since urged the court to subject the decree to an independent public-interest review.

The deal faces backlash from the "Block the Merger" coalition, including actors Jane Fonda and Mark Ruffalo, who labeled the settlement a win for billionaires. While the Screen Actors Guild expressed support, the Writers Guild of America noted it must now pursue a costly antitrust lawsuit alone without government backing. Paramount CEO David Ellison expects the deal to close in two weeks, though the company faces a $7 million daily ticking fee starting October 1 if delays persist.