California AG Rob Bonta Defends Paramount Merger Settlement Amid Widespread Criticism

California Attorney General Rob Bonta defended the antitrust settlement permitting the merger of Paramount and Warner Bros. during a lengthy press conference on Monday, asserting that the agreement features independent oversight and is poised to generate increased employment opportunities within Hollywood.

However, the settlement lacks the specific “robust structural remedies” that Bonta had initially targeted since filing the lawsuit in July. Although he endeavor to present the agreement as a “strong” outcome, he candidly admitted that it was not his preferred resolution.

“I do not believe these two entities should merge,” Bonta stated, clarifying that the focus of the settlement was on resolving the antitrust concerns rather than blocking the merger outright.

In recent weeks, Bonta faced mounting pressure from various quarters, including Governor Gavin Newsom, former Attorney General Xavier Becerra, cinema trade groups, and labor leaders, who all voiced support for a settlement. Meanwhile, Paramount escalated the pressure by threatening to relocate operations to Tennessee and pursuing a court order to compel the 12-state coalition to pay $1.88 billion for delays in the merger process.

During the press conference, Bonta attempted to minimize the external pressures, stating, “That is not my focus.” He argued that the Attorney General’s strong legal victories in court had forced Paramount to make significant concessions.

“We achieved the antitrust resolution we aimed for,” Bonta asserted, highlighting “very strong remedies and commitments” designed to address the specific concerns raised by the state.

When asked if the states could have succeeded in a trial scheduled for the following spring, Bonta noted that court proceedings inherently “always carry risk.” He also acknowledged that prolonging the litigation would foster “uncertainty” in Hollywood, a concern previously raised by Paramount and several labor unions.

“This deal provides essential certainty regarding the future of production in Los Angeles,” Bonta explained, pointing out Paramount’s commitment to boosting domestic production and preserving its L.A. lots for at least five years. He added that this certainty is highly anticipated by the industry.

Bonta further argued that this outcome stands in stark contrast to Hollywood’s previous major merger, the Disney-Fox deal, which faced no antitrust challenges and ultimately resulted in reduced film production.

“This agreement is the antithesis of the Disney-Fox merger,” Bonta remarked. “While the Disney-Fox merger led to a massive decline in film production, this settlement not only guards against such downsides but also secures a substantial upside for the industry.”

Bonta stood alone at the podium, without his trial team or representatives from the other eleven states involved in the lawsuit. Additionally, he was not accompanied by the Writers Guild of America (WGA), which had filed its own antitrust lawsuit and resolved it over the weekend.

In a separate statement, the WGA indicated that the settlement terms “fall far short of adequately protecting writers,” though they expressed that they could not sustain the financial burden of continuing their lawsuit without state support.

Connecticut Attorney General William Tong also voiced disappointment that the deal does not include the divestiture of CBS and CNN, which he argued was essential to preserving “ethical and independent journalism.”

“We fought vigorously for this remedy,” Tong stated. “I am deeply disappointed that we could not achieve more.”

Bonta noted that all twelve states signed on to the settlement. He also clarified that the WGA was not involved in the states’ negotiations.

“They brought their own case,” Bonta explained, noting that the WGA decided whether and under what terms they wished to resolve their lawsuit.

Bonta stated that there was no single pivotal moment or provision that unlocked the deal, and he struggled to provide a clear timeline of how the agreement was finalized.

“These days have blurred due to intense and robust conversations,” he remarked.

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