Paramount Skydance and Warner Bros. Discovery are trying to complete a merger that would unite Paramount and Warner Bros., two storied film studios, while also assembling a broad lineup of U.S. pay TV networks and streaming platforms HBO Max and Paramount+. The proposed deal is valued at $110 billion.
A group of 12 state attorneys general, headed by California's Rob Bonta, filed in July to challenge the merger. They argue the deal violates the Clayton Antitrust Act, a more-than-100-year-old law that bars anticompetitive mergers and acquisitions.
Paramount says those states should have to put up their own money if they want to hold the deal in court. On Monday, the company asked a judge to require them to post a $1.88 billion bond to cover the costs of the delayed closing.
A trial involving Paramount and the state attorneys general is set for March. Paramount has agreed to put off the closing until no later than June 2027 while the case heads to trial.
Paramount is requesting the $1.88 billion bond because it says ticking fees and related expenses will keep piling up as the closing is delayed. A Paramount spokesperson cited the Clayton Antitrust Act and other federal law as requiring the plaintiffs - here, the states - "to post a bond covering the potential harm from halting a transaction to litigate."
"Here, every month of delay carries substantial and quantifiable financial consequences," Paramount said in its statement.
California's attorney general is not convinced. A representative for Bonta's office responded, "Paramount went into this process with eyes wide open. They are lying in a bed of their own making."
Paramount has already received antitrust clearance from the U.S. Department of Justice's Antitrust Division and all other global regulators needed to complete the deal.
This is a corporate fight, but the stakes reach regular investors. If you own shares in either company, the ticking fee directly changes what the deal could be worth if it closes.
It also changes the odds for a merger that would reshape the streaming and studio business. The outcome decides who ends up owning some of the most recognizable studios and streaming services in the country.
The bigger lesson is about how long deal drama can last. Even after regulators sign off, a merger can sit in court for months or years, and the price of waiting adds up. For the average investor, that is a reminder that a merger is not done until the courts are done. Until a judge rules, the fate of this deal and the cash attached to it stays up in the air.