Key Points
- A federal judge extended a temporary restraining order blocking the merger between Paramount and Warner Bros Discovery while considering a preliminary injunction.
- State attorneys general and the Writers Guild of America argue the $111 billion deal will concentrate too much power within a single media entity.
- The deal has cleared the DOJ and received conditional E.U. approval, but still faces scrutiny among some states and the United Kingdom.
A federal judge in California has extended a temporary restraining order that effectively halts Paramount’s merger with Warner Bros Discovery (WBD) while the court weighs the possibility of issuing a preliminary injunction and what conditions should come with that order.
The extension was announced on Thursday by U.S. District Judge Araceli Martínez-Olguín in Oakland, who noted the original temporary restraining order was scheduled to expire on August 3.
The order was extended because the court still needs time to sift through various arguments regarding a possible preliminary injunction and to settle other matters, Martínez-Olguín wrote. Ordinarily, a temporary restraining order cannot last longer than two weeks, but Paramount and WBD agreed to “abide by the terms” of the order “for some weeks into the future,” Martínez-Olguín affirmed.
Paramount wants a hearing to present evidence and discuss its arguments in favor of rejecting the preliminary injunction, and attorneys for the entertainment giant believe the hearing could last as long as three days, according to court records reviewed by The Desk.
Martínez-Olguín said Paramount needs to meet with several state attorneys general and the Writers Guild of America, the plaintiffs who brought the court action earlier this month, to determine the best steps forward. Those discussions are expected to be detailed in a written report that is due for filing on Friday.
A previously-arranged hearing scheduled for August 3 is still on the court’s docket, but it could be delayed based on the outcome of the meet-and-confer discussions between Paramount and the other parties in the case.
The case brought by California and a number of other states argue Paramount’s $111 billion acquisition of WBD violates federal antitrust law because it concentrates too much power with a single media entity who will have outsized influence over film and television production, cable TV networks, streaming platforms and content distribution.
Paramount and WBD are headquartered in California, and Paramount owns six local TV stations in the state — two each in Los Angeles, Sacramento and San Francisco. Three of those six stations offer programming from its CBS broadcast network. Both companies also operate major film studios and have other business ventures, including bureaus in Los Angeles for their news networks.
Paramount contends the size of its company following an acquisition of WBD will still dwarf that of other entertainment operations, including those backed by major tech companies like Netflix, Google and Amazon. All three companies have streaming products that compete with Paramount and WBD in the United States and other countries.
The U.S. Department of Justice’s antitrust division already cleared Paramount’s acquisition of WBD, and the companies secured conditional approvals from European Union regulators earlier this week. Regulators in the United Kingdom, which broke from the E.U. a decade ago, are still weighing the possibility of challenging the merger.
