A federal judge has approved an antitrust settlement between Paramount and 12 state attorneys general, clearing the last hurdle for the merger between Paramount and Warner Bros. Discovery.
The settlement resolves a suit filed by the 12 state attorneys general under Section 7 of the Clayton Act, which had argued that the combination of Paramount and Warner Bros. Discovery would create excessive concentration in the markets for theatrical films and television channels.
What's at Stake?
The combined company must meet certain conditions to avoid divestiture and penalties. According to the agreement, the combined company must release at least 30 films per year in the first two years and at least 32 per year in years three through five. Each film required to have a theatrical window of at least 45 days.
The combined company must also increase domestic production spending by at least $300 million annually above 2025 levels. Failure to comply could require the divestiture of BET, VH1, Comedy Central, Smithsonian, Destination America, and Science.
Ensuring Editorial Independence?
The combined company must establish a five-member editorial independence board composed of journalists, with authority to resolve disputes involving CBS News and CNN over alleged violations of editorial principles, reporting bias, and fairness standards.
What About the Writers?
A separate settlement was also reached with the Writers Guild of America, which had filed its own suit to block the deal. Paramount agreed to make a one-time $17.5 million contribution to the Writers' Guild-Industry Health Fund and pay up to $6 million in the WGA's legal costs.
A federal judge approved the agreement on Wednesday, clearing the last hurdle for the merger between Paramount and Warner Bros. Discovery. The merger is expected to close on Oct. 6.
