A U.S. federal judge has temporarily halted Paramount Skydance‘s proposed acquisition of Warner Bros. Discovery, ordering the companies not to close the deal until at least August 3, after a coalition of 12 U.S. states, led by California, challenged the transaction on antitrust grounds.
Media reports suggest that the temporary restraining order, issued by Judge Araceli Martínez-Olguín in California, comes amid concerns that the proposed $110 billion merger could substantially reduce competition in the media and entertainment industry. The states argue the combined company would wield excessive influence across film distribution and cable programming, potentially leading to higher prices, fewer choices for consumers and adverse effects on workers.
Also read: Paramount’s $110 Bn Warner Merger Deal Challenged By 12 US States
As per reports, the court has scheduled a hearing for August 3 to determine whether the merger should remain on hold while the broader antitrust lawsuit proceeds, a process that could take months. The temporary pause represents the biggest legal hurdle the deal has faced since it was announced.
Paramount Skydance has rejected the allegations, arguing that the transaction is necessary to compete with global streaming giants such as Netflix, Amazon and Apple, and that the lawsuit overlooks the realities of today’s media landscape. The company also noted that the merger has already secured approvals from several regulators outside the U.S., while reviews continue in jurisdictions including the U.K. and the European Union.
The delay could also have significant financial implications. Under the merger agreement, if the transaction is not completed by September 30, Paramount would be required to pay Warner Bros. Discovery shareholders a “ticking fee” of approximately $7 million per day until the deal closes.
