Paramount-Warner Bros. Discovery Merger Hits a New Delay as Judge Refuses to Rubber-Stamp the Antitrust Settlement
Paramount Skydance’s $110 billion takeover of Warner Bros. Discovery isn’t cleared for landing after all. Just days after Paramount announced it had settled the antitrust lawsuits standing in the deal’s way, a federal judge refused to rubber-stamp that settlement at a September 24 hearing, siding with opponents who argued the agreement doesn’t do enough to protect competition. The merger that CEO David Ellison said could close “within two weeks” is now stuck waiting on a ruling with no set date.
The Judge Wants Answers
US District Judge Araceli Martínez-Olguín held a hearing on the consent decree Paramount negotiated with a coalition of state attorneys general, and left it without an approval. She pushed back on clauses that would let Paramount sidestep parts of the deal if they “impaired” its ability to operate, and questioned whether the settlement’s oversight terms hold up under antitrust law at all. Her message to the companies was blunt: “The court is not a rubber stamp of your agreement.”
Who’s Fighting the Settlement
The judge granted the Block the Merger coalition, led in part by the media advocacy group Free Press, permission to file a brief opposing the deal. Free Press co-CEO Jessica González didn’t hold back, saying “this weak deal contains nothing but unenforceable, empty Paramount promises.” LULAC separately argued the settlement only guarantees minimum quotas for films and documentaries by or about Black and Latino communities, rather than real investment growth, while Senator Cory Booker asked the court to bring in an independent economic expert before signing off on anything.
Paramount Skydance CEO David Ellison told staff he expected the merger to close within roughly two weeks, a timeline this ruling now puts in doubt.
The Money on the Line
There’s a hard financial clock attached to all of this. Under the merger agreement, Paramount has until September 30 to close the deal before Warner Bros. Discovery shareholders start collecting a ticking fee worth roughly $7 million a day, on top of the billions Paramount would owe if the whole merger collapsed. Analysts at Morgan Stanley estimate the combined company would carry around $77.2 billion in net debt by the end of the year, on top of the $7.5 billion in new loans and $44.4 billion in additional secured debt Paramount has already lined up to fund the acquisition.
What Happens Next
Opponents had until September 25 to file their formal objections, and all sides now have until Monday, September 28, to respond to the concerns Booker raised. Martínez-Olguín says she’ll rule “in due course,” but hasn’t committed to a date, which leaves Paramount’s October 1 financial deadline uncomfortably close. As we covered when Paramount first announced the settlement, the agreement includes a five-year film production slate and a new editorial oversight board for CNN, terms that looked like the final hurdle before this hearing reopened the whole question. Whether a combined Paramount-Warner Bros. Discovery can still challenge Netflix on the timeline Ellison wants now depends on a judge who clearly isn’t in a hurry to sign off.
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Picture Source: Paramount
