US District Judge Araceli Martínez-Olguín has approved Paramount’s settlement with 12 states led by California. That clears the way for Paramount’s $110 billion purchase of Warner Bros. Discovery, which is expected to close as soon as Tuesday, October 6, Reuters reports.
Paramount and the states reached the settlement on September 21. The judge called it a “reasonable factual and legal resolution.”
The settlement resolves a lawsuit California and 11 other states filed to stop one of the biggest deals in media history. Prosecutors argued the purchase would create a “monopolist” and a “media giant” able to raise movie and TV prices for viewers.
Under the terms, Paramount must release at least 30 films a year in US theaters for five years. It had already promised theater chains the same number in August. Paramount will also spend an extra $300 million a year on production in the US. If it falls short, it could be forced to sell the Miramax film studio.
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Other commitments cover television. Paramount will negotiate with cable operators separately for each company’s channels. It will also set up a board of journalists to oversee its own CBS News and CNN, which belonged to Warner Bros.
California is pleased with the outcome. A spokesperson for the state’s Department of Justice said the settlement “resolves our antitrust concerns, protects competition and consumer choice, and centers the needs, concerns, and future of California workers.”
Some state attorneys general are disappointed, though. According to Bloomberg’s sources, prosecutors in Massachusetts, New York, Connecticut and Minnesota objected most strongly. Connecticut Attorney General William Tong said his office had pushed for a full divestiture of CNN and CBS News but didn’t get it. He did acknowledge that creating the independence board was important.
Separately, the companies settled an antitrust suit from the Writers Guild of America (WGA). They will pay $17.5 million into the guild’s health fund and won’t cut jobs for WGA members at CBS News for five years.
The leadership is changing, too. Paramount said Mattel CEO Ynon Kreiz will become co-CEO once the deal closes. He’ll share the role with David Ellison, who currently serves as Paramount’s chairman and CEO.
Before the settlement, Paramount had been unable to close the purchase for months. A federal court put the deal on hold in July at the states’ request.
Paramount later agreed to wait. It promised not to close until the court ruled on the case or until the merger agreement expired in June 2027.
The court had set the trial for March 2027. With the settlement in place, Paramount no longer has to wait for it.
Paramount struck the $110 billion deal after beating Netflix in the fight for Warner Bros. Discovery. Warner Bros. Discovery accepted Paramount’s offer in February.
Before that, Warner Bros. Discovery had agreed to sell its Warner Bros. film studio, HBO and the HBO Max streaming service to Netflix for $82.7 billion. Netflix didn’t raise its offer and walked away.
Once the deal closes, Paramount Pictures, CBS, Paramount+, HBO, CNN and other major media assets will sit under one owner. They include two streaming services, HBO Max and Paramount+, which Paramount plans to merge into a single platform.
