Key facts
- Free speech and media groups told a judge the Paramount/WBD merger settlement offers the public "virtually nothing."
- The groups argue the settlement does not adequately address antitrust concerns and will lessen competition.
- The settlement includes conditions like Paramount pledging to release 30 movies a year.
- California Attorney General Rob Bonta previously criticized similar proposed merger conditions as not enforceable.
- The settlement does not require any divestiture of assets.
- Judge Araceli Martínez-Olguín questioned if the settlement was a result of collusion rather than an arm's length process.
Free speech and media advocacy groups have urged a US judge to reject a settlement that would allow Paramount Global to finalize its $111 billion merger with Warner Bros. Discovery. The groups argue that the proposed conditions offered by Paramount are insufficient and provide the public with "virtually nothing" in terms of addressing antitrust concerns.
California, along with eleven other states, initially sued to block the merger in July, with US District Judge Araceli Martínez-Olguín ruling that the combination would likely reduce competition and violate antitrust laws. However, California Attorney General Rob Bonta recently announced a settlement with Paramount, which Martínez-Olguín must now approve.
The coalition, including the Committee for the First Amendment, Free Press, and Freedom of the Press Foundation, stated in a filing that the settlement "leaves that loss of independent decision-making largely intact." They criticized the proposed behavioral remedies, such as Paramount's pledge to release 30 movies annually, noting that Bonta himself had previously called such conditions "typically not enforceable" and "not particularly good at solving the problem."
The groups also pointed out that the settlement requires no divestiture of assets and that the film distribution guarantees might result in fewer films being released post-merger than the companies have independently forecasted for 2027. Furthermore, they criticized the definition of "independent film" within the settlement and noted that small business owners and independent contractors in the documentary and independent film industries "get nothing."
At a hearing, Judge Martínez-Olguín expressed skepticism, stating she wants to ensure the agreement was not the result of collusion. She also requested replies to a letter from Senator Cory Booker, who questioned how the settlement's provisions remedy the harms alleged in the original complaint and argued it fails to address the core anticompetitive claims and potential job losses.
The settlement also includes a provision requiring an "Editorial Independence Board" for CBS News and CNN, chosen by Paramount and reporting to its board. The advocacy groups raised concerns about potential government intrusion into editorial decisions, particularly in light of reports about "sweeping changes" offered at CNN in exchange for regulatory approval.
Regarding cable channel licensing, the settlement mandates separate negotiations for basic cable channels, which Bonta's office claims will preserve competition and keep prices down. However, the advocacy groups argue this carve-out for premium channels and streaming services still allows the combined entity to leverage its power and extract higher prices.