Paramount Settles With 12 State AGs and Writers Guild, Targets Early October Close on $110 Billion Warner Bros. Deal

Since the 12-state antitrust coalition led by California Attorney General Rob Bonta settled its lawsuit against Paramount Skydance on Monday, September 21, the company's $110 billion takeover of Warner Bros. Discovery has moved almost entirely out of the courtroom and into the boardroom. A federal judge is still withholding final sign-off, having ordered Paramount to answer Senator Cory Booker's questions by Monday, September 28.

The settlement, first detailed by The Wall Street Journal and confirmed by Variety and Bloomberg according to Breitbart's reporting, requires Paramount to invest $1.5 billion in California production, sell several cable channels, and accept an independent editorial oversight board for both CNN and CBS News. Paramount also agreed to pay a $30 million penalty for every film that falls short of CEO David Ellison's pledge to release 30 movies a year. No major divestitures of core assets were required, according to CNN Business.

The Writers Guild of America, which had separately sued over consolidation concerns, also settled, according to Law Commentary. That removes the second lawsuit that had threatened to keep the deal in limbo past a March 2027 trial date.

The stakes for timing were real. Had the case gone to trial, Paramount would have owed Warner Bros. Discovery shareholders a $7 million-per-day "ticking fee" for every day past October 1 the deal remained unclosed, according to Breitbart and Daily Wire. Settling in late September avoided what could have added up to roughly a billion dollars had litigation dragged to March.

Warner Bros. Discovery CEO David Zaslav told staff in a memo that the merger is expected to take effect "by early October," according to CNN Business. Ellison told employees the deal could close within about two weeks. Neither company has announced a firm closing date.

What Paramount gave up to get here

New York Attorney General Letitia James held out for additional concessions after other states appeared ready to settle, according to Daily Wire, which cited reporting that actor Mark Ruffalo and a group calling itself the "Block the Merger Coalition" pushed James publicly not to "cave." The added leverage produced the independent editorial boards for CNN and CBS that James's office wanted, according to Bloomberg's reporting as cited by Breitbart.

Combining CBS, CNN, HBO, Discovery, Paramount Pictures, Warner Bros. and NFL broadcast rights under one company gives Ellison and his father, Oracle billionaire Larry Ellison, enormous reach over both news and entertainment. The Writers Guild argued consolidation could weaken pay and working conditions industry-wide. Whether the editorial boards and $1.5 billion investment meaningfully offset that concentration of market power remains an open question.

CNN newsroom, in limbo

Inside CNN, reaction is mixed. "I think people are like, 'Let's just get this done,'" one CNN staffer told Fox News Digital. A second staffer pushed back on any narrative that opposition has softened: "Nothing has changed about anyone's views at CNN."

Unresolved is who runs the network. Reports have suggested Ellison's pick for CBS News editor-in-chief, Bari Weiss, could take on a broader oversight role, while current CNN CEO Mark Thompson's future is unclear, according to Fox News Digital.

Paramount+ bulks up before the marriage

While the legal fight wound down, Paramount's streaming team kept building. Internal documents viewed by Business Insider show plans for a free ad-supported tier, "micro dramas," interactive ad formats, a TikTok-style comments feed, and AI tools to auto-clip video. Several free-tier projects are slated for the fourth quarter of 2026 and the first quarter of 2027, though broader launch dates remain unset, according to a person familiar with the strategy.

The push addresses real weakness. Nearly 6% of Paramount+ subscribers canceled in August, the second-highest churn rate among major streamers, according to subscription data firm Antenna. More than a third of subscribers only lightly used the service, per Antenna's June report. "It's a war for time spent, and you're chasing the juggernaut," Lightshed Partners analyst Rich Greenfield said, referring to Netflix and YouTube.

Not everyone is convinced the merger delivers what Ellison promises. Wharton professor Paul Nary wrote on X that "most large media megamergers fail to live up to their promises," calling the integration work "the harder work" still ahead, according to CNN Business.

Separately, Warner Bros. Discovery CEO David Zaslav sold roughly $200 million in company stock in recent months, including $21.7 million on August 13, according to regulatory filings cited by Law Commentary, sales made while the deal was still tied up in litigation.

The immediate open question is what Paramount tells the court by Monday, September 28, in response to Senator Booker's letter. Until that answer is filed and reviewed, the October closing timeline Ellison and Zaslav have floated to staff remains a target, not a certainty.