Paramount Reaches Deal With 12 States, Removing Major Hurdle to Warner Bros. Acquisition

By Angel No Lie | KPD Online | September 22, 2026

LOS ANGELES — September 22, 2026 — Paramount Skydance has reached a settlement with California and 11 other U.S. states, resolving a major legal challenge to its proposed acquisition of Warner Bros. Discovery and clearing a key obstacle to the roughly $110 billion transaction.

The agreement ends an antitrust lawsuit filed in July by a coalition of state attorneys general. The states had argued that combining Paramount and Warner Bros. Discovery could reduce competition across movie production, television, streaming and cable markets.

Conditions attached to the settlement

Under the agreement, the combined company will face several court-enforceable commitments over a period of up to five years.

Among the most significant provisions is a requirement to maintain a minimum level of theatrical movie production. The company must release at least 30 films annually during the first two years, rising to 32 films a year for the following three years. Financial penalties can apply if the commitments are not met.

Paramount has also committed to spending an additional $300 million annually on domestic film production, representing at least $1.5 billion in additional investment over five years. The settlement also establishes a $47.5 million fund for workers affected by the transaction.

The agreement includes provisions concerning cable negotiations and establishes measures intended to protect editorial independence at CBS News and CNN, two major news organizations that would come under the same corporate ownership following the transaction.

A major change for Hollywood

If completed, the acquisition would combine Paramount and Warner Bros. Discovery’s extensive entertainment operations, including the Paramount and Warner Bros. film studios, CBS and CNN, and streaming services Paramount+ and HBO Max.

The Justice Department had previously cleared the transaction, while the lawsuit by the 12 states became a significant remaining obstacle. The settlement is subject to court approval.

California Attorney General Rob Bonta, whose office led the states’ legal challenge, said the settlement should not be interpreted as an endorsement of the merger. The states had originally sought to prevent the transaction, arguing that it could affect competition and consumers.

Paramount CEO David Ellison has described the merger as beneficial to consumers and the entertainment industry. The company is now moving toward completion of the acquisition, although the settlement’s court approval remains an important procedural step.

The proposed transaction would mark one of the largest consolidations in the modern U.S. entertainment industry, bringing two major Hollywood studios and their television, streaming and news operations under a single corporate structure.