US judge pauses $111bn Paramount-Warner Bros merger in antitrust ruling

A US federal judge has issued a 14-day temporary restraining order, effectively pausing the proposed $111 billion merger between Paramount and Warner Bros. The order, issued by US District Judge Araceli Martínez-Olguín, follows a legal challenge from a coalition of 12 state attorneys general, including California’s Rob Bonta. The pause allows the court time to review the lawsuit, which argues the deal violates federal antitrust laws and would reduce competition.

The 12-state coalition contends that the consolidation of major media properties would lead to higher prices for consumers. The deal involves the merging of significant assets, including HBO Max, CBS, CNN, Showtime, TNT, TBS, Paramount+, DC Studios, Comedy Central, Discovery, New Line Cinema, Warner Bros. Pictures, and Paramount Pictures. This represents one of the largest media consolidation deals in recent history.

California Attorney General Rob Bonta described the pause as a "critical first win" in the case, stating it ensures the megamerger does not proceed. Paramount argued in court that the restraining order was unnecessary, although the company has not yet issued a public comment on the ruling. The order lasts for 14 days but could be extended if both parties agree.

The merger was originally expected to close as early as 22 July, but the legal intervention has delayed that timeline. A hearing regarding a preliminary injunction is scheduled for 3 August to determine the future of the deal. If the court grants the injunction, the merger could be permanently blocked. If the court rules against the injunction, the deal may be fast-tracked to completion.

The transaction carries significant financial stakes for the acquirer. If the merger does not close by 30 September, Paramount will be liable for daily payments to Warner Bros. investors, amounting to millions of dollars per day. The final outcome remains uncertain pending the 3 August hearing and subsequent court rulings.