Paramount Settles Antitrust Suit, Clearing Last Legal Hurdle for $111 Billion Warner Bros. Discovery Deal

California Attorney General Rob Bonta settled his antitrust lawsuit against Paramount Skydance on Monday, September 21, removing the last serious legal obstacle to the company's $110.9 billion acquisition of Warner Bros. Discovery, according to Business Insider.

The suit, joined by several other states, had sought to block or reshape the merger between Paramount, controlled by Larry Ellison and his son David, and Warner Bros. Discovery, the parent of HBO, CNN, and two major film studios.

What Bonta Got, and Didn't

Bonta had repeatedly said he wanted "structural" changes to the deal, meaning the Ellisons would have to sell off part of the combined business to win his approval, Business Insider reported. That didn't happen.

Instead, Bonta secured what he called an "enforceable commitment" that the merged studios will produce at least 30 movies a year. That's a pledge David Ellison had already made publicly since April, according to Business Insider and Jingle Tree.

Bonta acknowledged as much at a press conference Monday. "I didn't believe these two companies should merge," he said. "I still don't." Bonta spent much of the press conference discussing other antitrust cases his office is pursuing, according to Business Insider's account of the event.

Media consolidation critics, including antitrust advocates who back Bonta's broader position, argue that combining CBS, CNN, HBO, Paramount Pictures, and Warner Bros. under one family's control concentrates an unusual amount of news and entertainment output in a single set of hands. That concern doesn't require proving wrongdoing to be legitimate. It's a structural question about how much market power one company should hold. The settlement, however, resolved the legal case without addressing that structural question at all. No source in this record shows Bonta got any divestiture, spinoff, or ownership cap.

How We Got Here

The path to this outcome has looked fairly predictable for roughly a year. Larry Ellison, ranked No. 7 on Bloomberg's billionaire index with an estimated net worth around $200 billion (down from roughly $400 billion last fall when Oracle stock was riding an AI rally), was always going to be able to outbid or outlast most challengers. He is personally guaranteeing financing for the Warner Bros. Discovery purchase, meaning the Ellisons don't answer to outside shareholders the way a public company's board would.

That mattered when Netflix briefly entered the picture. Last December, Netflix negotiated a deal to buy part of Warner Bros. Discovery instead of letting Paramount buy the whole company, Business Insider reported. Netflix walked away a few months later. Business Insider says that could reflect regulatory concerns Netflix saw ahead, or it could reflect that Paramount had signaled it would keep raising its offer regardless of cost. Netflix's own shareholders, unlike Ellison, had reason to avoid a prolonged bidding war.

The Justice Department signed off on the Paramount-Warner Bros. Discovery deal in June. Business Insider reported that approval reportedly came before staff attorneys who had raised concerns about the deal were given a chance to weigh in, though no formal finding of improper process has been made public and no investigation into how the DOJ reached that decision has been announced. David Ellison said last year that Paramount has "a good relationship with the administration," a relationship Business Insider and Jingle Tree both note in explaining why observers expected federal approval well before the deal was formally announced. Neither outlet cites evidence of any specific directive from the White House to DOJ staff on this matter, and this article does not assert one occurred.

The Punchline, Literally

The deal's cultural footprint showed up Sunday night on HBO's "Last Week Tonight." Host John Oliver, whose show is produced by HBO and therefore will soon fall under Ellison ownership, mocked David Ellison's reliance on his billionaire father while discussing UnitedHealthcare's coverage denials. Oliver called Larry Ellison his "soon-to-be business daddy's" "literal business daddy," according to Variety. Oliver recently renewed his contract through 2027, ahead of the Ellisons' expected takeover.

What's Left

With Bonta's suit resolved and no other serious regulatory challenge outstanding, Business Insider reports the Ellisons can move to finalize the $111 billion acquisition in the near future. What remains unresolved is whether any other state attorneys general who joined the original suit plan to pursue separate action, and whether the 30-movies-a-year commitment will carry any real enforcement mechanism beyond the settlement's language. Bonta's office has not detailed what penalty, if any, Paramount would face for falling short of that number.