I’m the creator and author of The Wakeup, Ankler Media’s daily briefing for media and entertainment executives, covering film, television, streaming and sports media.
It’s been less than two weeks since the Justice Department closed its eight-month probe of Paramount Skydance’s $111 billion takeover of Warner Bros. Discovery and pronounced it harmless — not likely, in the department’s words, to hurt competition or American consumers. Then came the awkward part. The career lawyers who’d spent those eight months on the file were leaning toward recommending a lawsuit, according to the Wall Street Journal, but were overruled. Some of them reportedly believe the clearance statement was written less to settle the antitrust question than to make it harder for someone else to reopen it.
That someone else is a coalition of state attorneys general, led by California’s Rob Bonta and joined by New York’s Letitia James and others, that is preparing to sue to block the deal — possibly within weeks. The companies are targeting a September close, and the foreign clearances are falling into place. The EU and U.K. reviews are still pending into the summer (but good news! China approved the deal with no conditions, so I think we can sew this up pretty quickly now).
So the states are, functionally, the last meaningful obstacle in the domestic market.
That obstacle could be formidable. Bonta already pried an injunction out of a federal judge to halt the Nexstar-Tegna station merger after the DOJ and FCC waved the deal through in March. A coalition of states beat Ticketmaster at trial after the DOJ settled. The lesson of the past two years is that a federal blessing is the beginning of the fight, not the end of it — and the question a state complaint will turn on is the exact one the DOJ just waved off: Is this bad for consumers?
Still, though the DOJ may have closed the file, a state lawsuit could open the drawers. Start with the cable bills, follow the HBO and Paramount+ money, look at the theater terms — and don’t ignore the newsrooms and the political powder keg of putting CNN and CBS News under one roof.
Below, I go sector by sector through the combined company, the way an AG’s office would in building a case.
News: the Political Case
This is the realm most likely to animate a state lawsuit.
Don’t stop here
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