Key facts
- California Attorney General Rob Bonta will soon decide whether to sue to block Paramount's $110 billion acquisition of Warner Bros. Discovery.
- Bonta's office is reviewing the deal for potential antitrust violations.
- Concerns have been raised by movie theater owners, actors, and others about decreased competition.
- Bonta indicated a preference for structural remedies over behavioral remedies if antitrust violations are found.
- Other states are discussing a joint challenge to the deal with California.
California Attorney General Rob Bonta is nearing a decision on whether to challenge Paramount's proposed $110 billion acquisition of Warner Bros. Discovery. His office has been scrutinizing the deal for potential antitrust violations, with various industry stakeholders expressing concerns about reduced competition, leading to potential lower wages, higher prices, and fewer consumer choices. Bonta stated that his office has heard numerous concerns from industry workers, which have raised 'red flags.' He indicated that while behavioral remedies might be part of a solution, they should ideally be supported by structural remedies if they prove inadequate. The U.S. Department of Justice is also expected to reach a decision soon, and antitrust authorities in Europe are set to rule by early July, creating time pressure for Bonta's office. Paramount, however, maintains that it has economic incentives to expand production post-merger and that CEO David Ellison has committed to releasing 30 movies annually in theaters, viewing theatrical releases as crucial for marketing its streaming services. California's Department of Justice boasts the largest antitrust division in the U.S., with plans to expand its staff and budget. Other states are reportedly in discussions with California about a potential joint challenge to the merger.