Judge Halts $111 Billion Paramount and Warner Bros. Discovery Merger

U.S. District Judge Araceli Martinez-Olguin issued a temporary restraining order on July 20, 2026, halting the merger between Paramount and Warner Bros. Discovery for at least 14 days. The ruling follows an antitrust lawsuit filed on July 13 by a coalition of 12 states, led by California, which alleges the deal violates the Clayton Antitrust Act by reducing competition in theatrical film distribution and basic cable markets.

The merger, valued at approximately $111 billion including debt, is challenged by state attorneys general who argue the transaction would create a media behemoth, leading to higher consumer prices and fewer content choices. Judge Martinez-Olguin stated that the public's interest in antitrust enforcement outweighed the temporary delay, noting that proceeding would make it difficult to unscramble the egg if the deal is eventually blocked.

Paramount contends the merger is pro-competitive and necessary to compete with streaming giants like Netflix. However, the judge rejected the argument that streaming efficiencies would offset the harms to other markets. The companies aimed to close the deal by September 30 to avoid a ticking fee penalty of approximately $7 million per day, or 25 cents per share per quarter, owed to Warner Bros. investors.

A hearing for a potential preliminary injunction is scheduled for August 3 in Oakland, California, which could freeze the merger for several months.