Paramount Skydance had been pushing to close its $110 billion acquisition of Warner Bros. Discovery by the end of September. It picked the wrong month to be optimistic.
A coalition of 12 state attorneys general sued to block the deal on July 13, a federal judge issued a temporary restraining order days later, and now the closing date has been pushed as far back as June 2027.
Paramount filed an 11-page court stipulation on July 24 agreeing to hold off on closing the transaction until five days after the judge rules on the antitrust case, or June 1, 2027, whichever comes first, CNBC reported. The deal is still alive. It is just moving on a very different timeline than anyone expected three weeks ago.
Who’s fighting the Paramount-Warner Bros. merger?
The legal challenge came from 12 states led by California Attorney General Rob Bonta. The coalition includes Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington.
They filed suit July 13, arguing the merger would reduce competition in three areas: wide-release theatrical film distribution, top-grossing movie distribution, and the market for distributing basic cable channels to cable and satellite providers.
U.S. District Judge Araceli Martínez-Olguín of the Northern District of California issued the temporary restraining order that same week. The Writers Guild of America also filed a separate lawsuit the following day, alleging the deal violates federal antitrust law and would hurt pay and opportunities for writers, Axios reported.
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Paramount said in its filing that it still believes the merger should be allowed, and called the states’ case “wrong on both the facts and the law” and “one of the weakest merger challenges” it has seen. The company rejected claims it would reduce competition.
Bonta responded by calling the stipulation “great news for audiences, movie theaters, and the many people who write, build, and create the art, news, and entertainment so many of us enjoy.”
Why the state challenge of Paramount’s WBD acquisition landed so hard
The deal had cleared two major regulatory hurdles before the states moved. The Department of Justice antitrust division declined to challenge it in June. European regulators approved it around the same time. Both federal and international reviewers gave the green light, Variety reported.
State attorneys general have been increasingly willing to fill the gap when federal antitrust enforcement pulls back.
Bonta pointed to that shift explicitly, saying the federal government had “abdicated” its responsibility to challenge big corporate mergers. The states argued that Section 7 of the Clayton Antitrust Act of 1914 bars mergers likely to substantially lessen competition, and they say this one does.
The deal would combine Paramount Pictures and Warner Bros. Pictures, Paramount+ and HBO Max, CBS News and CNN, and dozens of cable channels under Paramount Skydance chief David Ellison.
New York Attorney General Letitia James called the temporary pause “a critical victory in our efforts to uphold the law and protect the film and television industries.”
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What the new timeline means for Paramount and WBD investors
Paramount previously said it wanted to close by the end of September. The new stipulation eliminates that target entirely. No trial date has been set, but Paramount has indicated it wants a trial as early as November. California has said the states may seek a 2027 proceeding to allow more preparation time, NBC News reported.
For investors in both companies, the merger is no longer a near-term event. It is now a legal process with a months-long runway. Paramount’s stock may trade with deal-related uncertainty rather than a clean acquisition premium. WBD shareholders get assurance the deal hasn’t collapsed, but they have to wait much longer to see whether it actually closes.
Why the outcome of this antitrust case matters beyond these two companies
State attorneys general in Democratic-led states are taking a more aggressive stance on large media mergers after federal enforcement has pulled back under the current administration. Other studios or media companies watching this case will have a clearer read on how much state-level resistance to expect before they announce their own deals.
The case also tests how far state authority extends on federal antitrust questions. The deal cleared the DOJ and European regulators. A state coalition blocking it anyway would mark a significant expansion of state power in merger oversight, which has implications well beyond Hollywood.
Bonta said the states intend to continue seeking a permanent order blocking the merger, even after the pause agreement was signed.
Paramount has said it will fight the case on the merits. The company filed its stipulation voluntarily, not under a court order requiring it to do so.
That gives Paramount the legal positioning to argue it is cooperating with the process while still contesting the core claims. The two sides must submit proposed trial schedules by July 31.
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