Paramount Skydance’s settlement talks with state attorneys general have reached a critical stage as opponents of its merger with Warner Bros. Discovery rally against the deal.
The federal lawsuit filed in July by 12 states, including California and New York, remains the main obstacle to the $110 billion deal.
Paramount faces a tight deadline. The company will pay WBD shareholders an extra $7 million each day from October 1 if it fails to close the deal.
Sources familiar with the talks said negotiations with California Attorney General Rob Bonta’s office were moving in a positive direction.
The two sides were expected to continue talks on Sunday. They planned to pause by evening for the Yom Kippur holiday if they had not reached an agreement.
Bonta seeks structural remedies
Bonta has demanded “structural remedies” as part of any settlement.
However, reports suggest his office could accept measures that stop short of separate ownership.
The Wall Street Journal reported that the deal could require the two studios to operate “separately for a period” rather than combine them immediately.
Paramount Skydance CEO David Ellison has already made a similar pledge.
In a February 28 letter to Sen. Adam Schiff and Rep. Laura Friedman, Ellison wrote: “My promise to you is to build a stronger Hollywood by keeping both of these legacy studios operating separately, thereby preserving and potentially increasing jobs.”
The talks also cover Paramount’s film output. Ellison has pledged to produce at least 30 films each year.
The sides have also discussed a written commitment to remain in California. Another proposal would create a third-party “editorial adviser” for CNN and CBS.
Bonta has criticised behavioural remedies as weak and difficult for states to enforce.
“There needs to be separate ownership,” he said.
“If it’s under the same Paramount-Warner Bros. merged-entity roof, that’s not separate.”
Merger opponents plan rallies
Opponents of the deal are preparing rallies in Oakland, Los Angeles and New York.
The Block the Merger coalition rejected the reported settlement terms. It called them “an insult to everyone who has stood up against this harmful transaction.”
Actor Mark Ruffalo has also urged supporters to pressure Bonta.
“Don’t you dare @AGRobBonta, do not cave,” the actor wrote on X.
“You work for the people, the very people who will be hurt if you let this lousy deal filled with empty promises go forward.”
Ruffalo asked supporters to gather outside Bonta’s Oakland office on Sunday.
Organisers also planned rallies outside New York Attorney General Letitia James’ office on Monday and the Writers Guild of America West headquarters in Los Angeles on Tuesday.
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