Judge pushes back Paramount’s $111B takeover, stranding CEO Haluk

On Thursday, Judge Araceli Martinez‑Olguin postponed court approval of the settlement that would allow Paramount Pictures’ $111 billion takeover of Warner Bros. Discovery to move forward.

The decision came during a virtual hearing where the judge issued a “homework” assignment to the parties, telling them to address concerns by September 29. The delay comes after state attorneys general, led by California’s Rob Bonta, had hoped for a quick ruling.

The deal was first challenged on July 13 when Bonta, New York’s Letitia James and ten other blue‑state attorneys general filed an antitrust lawsuit under the Clayton Act. The lawsuit claimed that the merger would reduce competition in media distribution and advertising.

Paramount and Warner Bros Discovery agreed to a settlement that would include a consent decree and divestitures.

Senator Cory Booker of New Jersey sent a six‑page letter to the judge on Wednesday demanding an independent public‑interest review before the consent decree could be entered. Paramount filed its own paperwork that day, effectively telling Booker to “mind his own business,” .

## Background & Context

California Senior Assistant Attorney General Paula Blizzard defended the settlement during the hearing, dismissing Paramount’s alleged “threats” and “blackmail” to withdraw from California.

Blizzard also acknowledged that the settlement had sparked backlash in the past 72 hours, noting that states were still prepared to take the case to trial on March 2, 2027 if a consent decree is not approved.

Blizzard emphasized that the merger had generated widespread controversy over issues beyond antitrust, including media consolidation and corporate power.

She said, “We absolutely recognize that this merger has engendered a large amount of controversy and commentary and feelings and concerns on a whole host of issues,” adding that “A lot of these are outside antitrust” before concluding that the case remains focused on antitrust law.

Paramount’s CEO David Ellison has been a long‑time supporter of Democratic causes, yet it appears he has not contributed to Senator Booker’s upcoming campaign. The merger, which would combine Paramount’s film studio with Warner Bros Discovery’s extensive streaming catalog, would create one of the largest media conglomerates in history.

Analysts say the deal could raise questions about content control and advertising markets.

## What Happened

During the hearing, Judge Martinez‑Olguin asked whether the settlement and consent decree addressed the Clayton Act concerns that were at the core of the July 13 lawsuit. She also questioned whether the deal was an arm’s‑length transaction rather than a collusion. The judge’s remarks included, “I’ll get you a ruling in due course.”

Blizzard responded that the merger was presumptively valid, , phone calls and drafts. She highlighted that New Jersey’s AG Jennifer Davenport had already agreed to the settlement announced September 21. The judge was asked to review the settlement by September 29.

Outside counsel Josh Holiann disputed Paramount’s use of the term “blackmail” regarding timed leaks of the deal, insisting it was a business decision. He said, “It was a business decision … Paramount had to make.” Holiann also promised that the penalties in the settlement would keep the company accountable.

Judge Martinez‑Olguin also highlighted the financial pressure on Paramount, noting that a $7 million‑a‑day fee would start on October 1 if the settlement remains unapproved. The fee, tied to the daily delay of the consent decree, could accumulate quickly and force Paramount to act swiftly.

The judge’s remarks underscored how procedural delays can have significant monetary repercussions for the parties involved.

Blizzard argued that the settlement offers five years of remedies designed to remove competitive concerns and preserve competition.

She noted potential divestment of cable channels and referenced Miramax as part of the deal’s structure, stating, “This is the best solution other than blocking it completely.” She also warned that blocking the merger could lead to another deal in a year or so, adding, “So, if we block this merger, there will probably be another one … is that the best solution for the markets to preserve the competition that the Clayton Act requested.”

The hearing was delayed by about fifteen minutes after Zoom‑wide technical glitches prevented some attorneys and state officials from joining. Despite these hiccups, the judge directed that the settlement sign‑off would be postponed until Monday noon, leaving parties with an additional.

## What Happens Next

If a consent decree is not approved by September 29, the states have indicated they will move forward with a trial set for March 2, 2027. Paramount is also proceeding with a $7.5 billion debt raise, while the $7 million‑a‑day fee begins on October 1 if the settlement remains unresolved.

The judge’s comments closed with a succinct remark that echoed the . Booker.” The statement underscored the tension between state attorneys general and Paramount’s leadership, as highlighted by David Ellison’s history of political donations.

As the settlement hangs in limbo, the next weeks will determine whether Paramount’s billion‑dollar acquisition can be ratified or whether a protracted federal trial will begin.

Stakeholders across the entertainment industry are watching closely, with the outcome likely to shape media consolidation and antitrust enforcement for years to come.