On July 13, California state Attorney General Rob Bonta announced that he would lead a 12-state coalition in mounting a supposedly bold legal challenge to the proposed Paramount–Warner Bros. Discovery mega-merger. The deal had cleared every previous legal hurdle, but the states had to try and stop the Ellison family from gaining control over the plurality of American media production because, in Bonta's words, that consolidation would represent a "death knell for the film and TV industry—and for our democracy." Two months later, the parties have settled the suit, with the states meekly submitting and getting nothing serious to show for it. What a waste of time.
After a nine-month campaign, the Ellisons have won the right to dictate the future of American entertainment and media. It all began in December 2025, when Netflix agreed to pay WBD $72 billion in cash and stock for the latter's streaming and film-studio businesses. When WBD rejected Paramount's competing all-cash offer for everything it had, adding the TV arm to the assets in the Netflix deal, Paramount mounted a hostile takeover bid. The Ellisons' ominous pitch to WBD shareholders was: You better take our deal or our friend the President will reject your merger.
It worked. When the WBD board offered Netflix a chance to match Paramount's offer, the streaming giant instantly said no, and David Ellison had his prize. All he needed to do was jump over a few regulatory hurdles, most of which have been lowered or removed for people like him under the second Trump Administration. The Department of Justice approved the deal in June.
The states, together, still had the chance to stop or at least alter the shape of the merger. After all, a 30-state coalition had just stayed in, and won, an antitrust lawsuit against LiveNation after the Trump DOJ tried to settle that case away for nothing. In initial filings in this case, Paramount asked for a November trial date, while the states tried to push it out to April 2027; Paramount would be on the hook for a daily $7 million ticking fee to WBD shareholders for every day the deal wasn't complete before Sept. 30. This made settlement talks most likely to conclude shortly before that date, as the states had the leverage of time pressure. However, the states used that supposed leverage to hoist themselves off of the battlefield and into the toilet. Bloomberg reported the settlement on Monday morning.
The terms are frankly insulting. Paramount-WBD will have to distribute at least 30 movies per year to theaters (that's roughly the combined total the two companies will release this year) and spend an additional $1.5 billion on film production per year for five years. The merging companies also agreed to the formation of an independent editorial board for CBS and CNN. That's vague; Bloomberg reports that "the board will be composed only of journalists, with no executives or shareholders allowed to join" and "will be required to have political balance," but the thing that matters is how much power the board has. Which is: zero. This is like when an NBA owner sells a team on condition that they get to retain some measure of power within the organization, only for the new owner to knife them the second they can. Nobody pays billions for something they don't want to control.
Locking in more movies is nice, yet the increased spending bit will probably be offset by the sweeping layoffs Paramount is sure to conduct at WBD. The states got nothing of substance, no carveouts for specific WBD assets, no structural changes to the shape of the deal. Why did this happen?
Again, Bloomberg's reporting is instructive. Bonta may have been the face of the deal, but his own state's rotten leadership was against him. Gavin Newsom, who is determined to become president in 2028 on the platform of To Defeat A Republican, One Must First Become A Republican, pushed for a settlement, as did L.A. mayor Karen Bass and Newsom's presumptive, remarkably vacuous successor Xavier Becerra.
After California authored an initial settlement, state AGs from Massachusetts, New York, Connecticut, and Minnesota held out in an attempt to force the settlement to at least have something of value in it. They were forced to abandon the effort after they "concluded the expense of the legal battle was not justifiable without California at the helm," though they did secure the fake oversight board, so I guess good job to them. Maybe they can give Dylan Byers another way to praise Bari Weiss.
