Paramount-WBD lawsuit settlement would need structural remedies, Bonta says
California AG Rob Bonta said states are open to talks over the Paramount-WBD deal, but only with remedies addressing alleged market concentration.
By Sofia Marchetti · World Affairs Correspondent
2 min read
A Paramount-WBD lawsuit settlement would require “robust structural remedies,” California Attorney General Rob Bonta said in a CNBC interview, while leaving open the prospect of negotiations with Paramount Skydance. His comments indicate the states will seek changes aimed at their competition allegations rather than an agreement that leaves the proposed Warner Bros. Discovery acquisition unchanged.
Bonta leads a coalition of 12 state attorneys general that sued in July to block Paramount Skydance’s proposed purchase of Warner Bros. Discovery. According to CNBC, the case is scheduled for trial in March.
What would a Paramount-WBD lawsuit settlement need to address?
Bonta did not identify specific remedies that the states would demand. He said, however, that any discussions must center on the three markets named in the coalition’s complaint, where the states contend the transaction would violate antitrust law.
He said Paramount had sought to discuss streaming, CNN and foreign regulators, subjects Bonta said are outside the complaint’s focus. The states’ case instead concerns the proposed company’s position in film and basic-cable television, CNBC reported.
The lawsuit alleges that combining Paramount and Warner Bros. Discovery would give the new company control of nearly one-third of films and nearly a third of basic-cable TV programming. Bonta said that would amount to what he described as presumptively illegal concentration in the markets the states identified.
The coalition includes California, Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington, according to CNBC.
States say talks remain possible
Bonta said the states are willing to hold good-faith talks with Paramount and would rather resolve the dispute outside court. For now, he said, the coalition is pursuing its lawsuit and wants negotiations to address the allegations it filed.
He also rejected the argument that declining pay-TV subscriptions should weaken the challenge, saying the direction of the market does not alter the states’ legal theory.
Paramount has previously called the lawsuit a misrepresentation of competition in the current entertainment business and said it would vigorously defend the transaction, CNBC reported. The companies’ proposed combination would bring together the Paramount and Warner Bros. film studios, television networks including CBS, CNN, Discovery, MTV and BET, and the Paramount+ and HBO Max streaming services.
No settlement package has been announced. The evidence available does not specify whether the structural remedies Bonta referenced would involve sales of assets, changes to the deal or other measures.
This story draws on original reporting from CNBC.