Business
Commentary: Serious backlash to a Netflix/Warner Bros deal may come from European regulators
If you’re looking for where the most crucial governmental backlash to a merger deal involving Warner Bros. Discovery, you might want to turn your attention east — to Europe, where regulators are girding to take an early look at any such deal.
Both of the leading bidders — Netflix, which has the blessing of the WBD board, and Paramount, which launched a hostile takeover bid — could face obstacles from the European Union. EU officials have spoken only vaguely about their role in judging whatever deal emerges, since the outcome of the tussle remains in doubt.
The European Commission “could enter to assess” the outcome in the future, Teresa Ribera, the EU’s top antitrust official, said last week at a conference in Brussels, but she didn’t go beyond that. Pressure is mounting within Europe for close scrutiny of any deal.
A deal with Netflix as the buyer likely will never close, due to antitrust and regulatory challenges in the United States and in most jurisdictions abroad.
— Paramount makes its appeal to the Warner board
As early as May, UNIC, the trade organization of European cinemas, expressed opposition to a Netflix deal. The exhibitors’ concern is Netflix’s disdain for theatrical distribution of its content compared to streaming.
“Netflix has time and again made it clear that it doesn’t believe in cinemas and their business model,” UNIC stated. “Netflix has released only a handful of titles in cinemas, usually to chase awards, and only for a very short period, denying cinema operators a fair window of exclusivity.”
Neither WBD nor Netflix has commented on the prospect of EU oversight of their deal. Paramount, however, has made it a key point in its appeals to the WBD board and shareholders.
In both overtures, Paramount made much of the size and potential anti-competitive nature of Netflix’s acquisition of WBD. In a Dec. 1 letter sent via WBD’s lawyers, Paramount asserted that the Netflix deal “likely will never close due to antitrust and regulatory challenges in the United States and in most jurisdictions abroad. … Regulators around the world will rightfully scrutinize the loss of competition to the dominant Netflix streamer.”
Netflix’s dominance of the streaming market is even greater in Europe than in the U.S., Paramount said, citing a Standard & Poor’s estimate that Netflix holds a 51% share of European streaming revenue. That figure swamps the second-place service, Disney, with only a 10% share. Paramount made essentially the same points in its Dec. 10 letter to WBD shareholders, launching its hostile takeover attempt at Warner.
European business regulators have been rather more determined in scrutinizing big merger deals — and about the behavior of major corporate “platforms” such as Google and X.com — than U.S. agencies, especially under Republican administrations. One reason may be the role of federal judges in overseeing antitrust enforcement by the Federal Trade Commission.
“Despite the European Commission (EC) successfully doling out fines numbering in the billions of euros for giants like Apple and Google for distorting competition, the FTC has struggled significantly in court, losing virtually all its merger challenges in 2023,” a survey from Columbia Law School observed last year.
The survey pointed to differing legal standards motivating antitrust oversight: “American courts have placed undue weight on preventing consumer harm rather than safeguarding competition; by contrast, the EU has remained centered on establishing clear standards for competitive fairness.”
In September, for example, the European Commission fined Google nearly $3.5 billion for favoring its own online advertising display services over competing providers. (Google has said it will appeal.) The action was the fourth multi-billion-dollar fine imposed on Google by the EC since 2017; Google won one appeal and lost another; an appeal of the third is pending.
As an ostensibly independent administrative entity, the EC at least theoretically comes under less political pressure from the 27 individual members of the European Union than the FTC and Department of Justice face from U.S. political leaders.
President Trump has made no secret of his doubts about the Netflix-WBD deal. As I reported last week, Trump has said that Netflix’s deal “could be a problem,” citing the companies’ combined share of the streaming market. Trump said he “would be involved” in his administration’s decision whether to approve any deal.
That feels like a Trumpian thumb on the scale favoring Paramount. The Ellison family is personally and politically aligned with Trump, and among those contributing financing to the bid is the sovereign wealth fund of Saudi Arabia, a country that has recently received lavish praise from Trump. Another backer is Affinity Partners, a private equity fund led by Jared Kushner, Trump’s son-in-law.
The most important question about European oversight of the quest for WBD is what the regulators might do about it. The European Commission tends to be reluctant to block deals outright. The last time the EC blocked a deal was in 2023, when it prohibited a merger between the online travel agencies Booking.com and eTraveli. The EC ruling is under appeal.
At least two proposed mega-mergers were withdrawn in 2024 while they were under the EC’s penetrating “Phase II” scrutiny: the acquisition of robot vacuum cleaner maker iRobot by Amazon, and the merger of two Spanish airlines, IAG and Air Europa.
Typically, the EC addresses potentially anticompetitive mergers by requiring the divestment of overlapping businesses. In the case of Netflix and WBD, the likely divestment target would be HBO Max, which competes directly with Netflix in entertainment streaming. Paramount’s streaming service, Paramount+, also competes with HBO Max but not on the same scale as Netflix.
Antitrust rules aren’t the only possible pitfall for Netflix and Paramount. Others are the EU’s Digital Services Act and Digital Markets Act, which went into effect in 2022. The latter applies mostly to social media platforms—the six companies initially deemed to fall within its jurisdiction were Alphabet (the parent of Google), Amazon, Apple, ByteDance (the parent of TikTok), Meta and Microsoft. Those “gatekeepers” can’t favor their own services over those of competitors and have to open their own ecosystems to competitors for the good of users.
The Digital Services Act imposes rules of transparency and content moderation on large digital services. No platforms owned by Netflix, Paramount or WBD are on the roster of 19 originally named by the EU as falling under the law’s jurisdiction, but its regulations could constrain efforts by a merged company to move into social media.
The EU also has begun to show greater concern about foreign investments in strategic assets. Traditionally, these assets are those connected with national security. But defining them is left up to member countries. As my colleague Meg James reported, the sovereign funds of Saudi Arabia, Abu Dhabi and Qatar have agreed to back the Ellisons’ WBD bid with $24 billion — twice the sum the Ellison family has said it would contribute.
The Gulf states’ role has already raised political issues in the U.S., since the cable news channel CNN would be part of the sale to Paramount (though not to Netflix). Paramount says those investors, along with a firm associated with Kushner, have agreed to “forgo any governance rights — including board representation.”
That pledge aims to keep the deal out of the jurisdiction of the U.S. government’s Committee on Foreign Investment in the United States, or CFIUS, which must clear foreign investments in U.S. companies. But whether it would satisfy any European countries that choose to see Warner Bros. Discovery as a strategically important entity is unknown.
Then there’s Trump’s apparent favoring of the Paramount bid. Trump is majestically unpopular among European political leaders, who resent his pro-Russian bias in efforts to end Russia’s invasion of Ukraine. Trump has castigated European leaders as “weak” stewards of their “decaying” countries.
The administration’s recently published National Security Strategy white paper advocated “cultivating resistance to Europe’s current trajectory” and extolled “the growing influence of patriotic European parties,” which many European leaders interpreted as support for antidemocratic movements.
The document “effectively declares war on European politics, Europe’s political leaders, and the European Union,” in the judgment of the bipartisan Center for Strategic and International Studies.
How all these forces will play out as the bidding war for WBD moves toward its conclusion is imponderable just now. What’s likely is that the rumbling won’t stop at the U.S. border.
Business
Waymo reports teen riders for bad behavior and delivers them to the police
Robotaxis could be turning into robocops.
A self-driving Waymo reported two teens to San Mateo, Calif., police on Monday after they were found drinking alcohol and shooting toy guns in the back of the vehicle.
According to a social media post from the San Mateo Police Department, officers detained two 15-year-olds after the Waymo they were riding in contacted the department and stopped in a parking lot until law enforcement arrived.
“Parents do you know where your teens are?” the San Mateo Police Department wrote on Facebook following the incident. “Waymo does!”
Officers removed both teens from the vehicle and determined they were using toy guns to shoot Orbeez out the windows. Orbeez are small, water-absorbing beads sold at toy stores.
“Toy guns, water guns, and BB guns all pose real dangers, especially to an untrained eye,” the Police Department said. “The simple handling of them can cause fear in [passersby].” “
A video posted on Facebook shows at least five officers and a police dog responding to the scene and approaching the Waymo with their weapons raised.
Waymo did not immediately respond to a request for comment.
Waymo vehicles have internal cameras and microphones that may be used in an emergency or to “promote safety and security,” according to Waymo’s online support page.
The cameras are also used to ensure the vehicles are clean and to help find lost items, according to the support page.
The company said it does not use facial recognition or other biometric identification technologies to identify individuals.
“In more urgent circumstances, support may access live video during a trip,” the Waymo page said.
The San Mateo Police Department’s Facebook post has garnered nearly 60 comments, with one user accusing Waymo of “snitching.”
“At least they got a designated driver?!” one user commented.
Business
Commentary: How right-wing anti-transgender attacks led to a Supreme Court ruling upholding sex discrimination
At the Supreme Court, the unfounded fear of boys masquerading as girls in youth sports rolled the clock back on gender equality.
On the surface, the Supreme Court’s June 30 opinion upholding state laws barring transgender girls from women’s and girl’s sports teams looks like a victory for women’s rights.
The 6-3 opinion by Justice Brett M. Kavanaugh certainly presents itself that way. “Females and males have inherent physical differences relevant to athletic performance,” Kavanaugh wrote. “Therefore, in contact sports, forcing female athletes to compete against males can create significant safety risks.” He also asserted that “forcing female athletes to compete against males can undermine competitive fairness.”
The ruling applied to prohibitions enacted in Idaho and West Virginia against “biological” males’ participation on women’s teams in public schools. Federal judges in both states overturned the bans. The Supreme Court majority restored them. The ruling essentially upholds similar bans enacted in 25 other states.
There was no record of any transgender person participating in school sports in the State, let alone any ‘problem’ with transgender students … creating unfair competition or unsafe conditions.
— Justice Sonia Sotomayor, demolishing the Supreme Court’s argument in favor of banning transgender girls from girl’s sports
Kavanaugh, like Donald Trump and others in the anti-transgender camp, maintained that one’s gender is an immutable fact of life, established even before birth.
Anything else, Trump stated in an executive order he issued on inauguration day 2025, could only be the product of “gender ideology extremism.” The U.S., his order stated, recognizes “two sexes, male and female. These sexes are not changeable and are grounded in fundamental and incontrovertible reality.” That’s a “biological truth,” he declared.
In his own version of this overconfident and factually insupportable conclusion, Kavanaugh wrote: “As all agree, females and males have inherent physical differences relevant to athletic performance.”
Science recognizes that some people are “born with sex traits that don’t fit into typical male or female patterns,” to cite a discussion on the Cleveland Clinic web page on the topic “intersex.” The condition “may involve chromosomes, hormones, reproductive organs or genitals.”
From a psychological standpoint, medical science recognizes “gender dysphoria” as a real condition often requiring counseling and medical intervention such as the use of puberty blockers and hormones to stave off the development of secondary sex characteristics until the condition can be resolved.
No one disputes that there are physical differences between the sexes. Few would dispute that on average or even at the median, males may be bigger and more powerful than females, or that in certain contact sports the difference may be telling and on occasion dangerous.
But that’s not the same as asserting that the physical differences between males and females invariably mean that men will invariably prevail over women in all competitions or that their participation will endanger women.
The International Olympic Committee — in a policy statement Kavanaugh cited incompletely — says that in “most running and swimming events,” males have a 10% to 12% advantage over women. That’s a range that would accommodate the full spectrum of outcomes — transgender females win, cisfemales win, they tie. (The “cis” prefix denotes those living consistent with their birth gender.)
West Virginia and Idaho addressed this ambiguity by banning transgender women from all girls’ teams. So under their rules transgender girls can’t play football or soccer with cisgirls. But what’s the argument in favor of banning them from the 100-yard dash, or cross-country track, or diving, or archery?
But something else is going on here. The Supreme Court’s ruling was almost preordained, given the years-long campaign by conservatives to demonize transgender individuals as if they’re members of an alien species.
It will be recalled that during his presidential campaign, Trump spun a despicable fantasy in which children were kidnapped in school and secretly subjected to sex-change operations.
Trump’s executive order wiped out policies aimed at protecting transgender adults from discrimination. He moved to outlaw gender-affirming medical therapies for anyone under 19 by cutting off federal funding for healthcare institutions that provide such care.
He banned transgender individuals from serving in the military and ordered federal prison officials to move transgender inmates into the general populations consistent with their birth genders, which exposes them to physical assault. (Federal Judge Royce Lamberth of Washington, D.C., has blocked the government from transferring three transgender women into the male prison population or terminating their hormone treatments.)
I wrote during Trump’s first term, when his anti-transgender policies were still gestating, that the goal was to show that “one can target any community, as long as it doesn’t have a strong political voice or political power. These are the actions of bullies and cowards, pretending to be strong.”
Last year, the Supreme Court struck its first blow against transgender rights by upholding a Tennessee law banning transgender care, including puberty blockers and hormone therapy, for minors. Similar laws have been enacted in 25 other states. The majority in that ruling by Chief Justice John G. Roberts Jr. was identical to the one in the June 30 ruling — Roberts, Kavanaugh, and Justices Clarence Thomas, Samuel A. Alito Jr., Neil M. Gorsuch and Amy Coney Barrett.
Who are the targets of this ideological campaign? They number only about 1.6 million U.S. adults, or one-half of 1% of the U.S. population. About 300,000 adolescents ages 13 to 17, or 1.4%, identify as transgender, according to a study by UCLA School of Law.
In West Virginia, as Justice Sonia Sotomayor observed in her dissenting opinion, “there was no record of any transgender person participating in school sports in the State, let along any ‘problem’ with transgender students … creating unfair competition or unsafe conditions.”
In endorsing the flat bans directed at transgender women in Idaho and West Virginia, Kavanaugh argued that any attempt to implement case-by-case judgments of students’ requests to join sports teams inconsistent with their biological gender would create “an enormous practical and administrability problem.”
Is that so? That wasn’t the case in Maine, where the annual K-12 population is more than 170,000. There, a committee was charged with determining whether a student’s participation in a sport consistent with their gender identity but inconsistent with their biological sex would “result in an unfair athletic advantage” or present a risk of injury to others. The committee held 56 hearings from 2013 through 2021, or an average of seven per year. During the entire time span, only four involved transgender girls. (The outcome of those hearings couldn’t be learned.)
It was Maine’s policy, one might recall, that provoked a confrontation between Trump and Maine Gov. Janet Mills at the White House last year, when Trump threatened to withhold federal funding from the state unless it barred transgender students from competing on women’s sports teams. “We’ll see you in court,” Mills snapped.
Whether the Idaho and West Virginia laws genuinely protect girls from unfair competition is questionable. (The Idaho law is styled the “Fairness in Women’s Sports Act.”) In practice, the laws may subject women in public schools to “invasive sex verification procedures,” as educational expert George Theoharis of Syracuse University wrote after the court ruling.
They’re also based on a retrograde view of women as fragile creatures needing men’s protection, Theoharis wrote — “the same logic that has historically been used to justify excluding women from making their own healthcare decisions and girls from rigorous math and science; that physically demanding work is simply beyond them.” (There don’t appear to be any state laws barring transgender women from competing in men’s sports.)
Becky Pepper-Jackson, the plaintiff in the West Virginia case, in which she is identified only as B.P.J., is the only transgender girl who sought to join girl’s teams — track and cross-country — in the state. That was in 2021, just after West Virginia passed its law and she was about to enter sixth grade. She didn’t appear to pose any competitive risk to others on the track and cross-country teams she applied to join — her lawyers told the Supreme Court that on those no-cut teams, she “came in near the back.”
Anyway, she had not gone through male puberty, which theoretically might have endowed her with a competitive advantage, because she had been taking puberty blockers and female hormones.
Thanks to the court’s ruling, Sotomayor observed in a dissent joined by Justices Elena Kagan and Ketanji Brown Jackson, West Virginia can deny Becky access to school sports “because it thinks they have an inherent athletic advantage, even if the facts show that they do not.”
B.P.J., Sotomayor wrote, “cannot practice on girls’ teams, even if she would not take anyone’s spot in an eventual competition, even if everyone who tries out for the team makes it, and even if having the chance to participate could aid immensely in treating B. P. J.’s gender dysphoria.”
So whose interest was really protected by the Supreme Court?
Business
Orange County real estate investor pleads not guilty in $100 million bank fraud case
An Orange County real estate investor accused of criminally defrauding an Arizona bank of nearly $100 million pleaded not guilty Monday and remains in custody.
Mahender Makhijani, 44, of Corona del Mar — who also was ordered by an arbitrator to pay $1.34 billion in a separate civil fraud case — was arraigned in Santa Ana federal court on two charges.
He is accused of bank fraud and making a false statement to a bank in a June 8 case involving a $100 million real estate loan made by Phoenix-based Western Alliance Bank. He was taken into custody on June 10.
Makhijani is accused of providing bogus collateral for the October 2024 loan now in default. In a civil lawsuit, Western Alliance said the outstanding balance as nearly $99 million.
Prosecutors say he falsified title insurance policies that showed the bank would have a first lien on the underlying collateral if the loan went bad, when in fact it did not.
A trial was set for August 11 before U.S. District Judge David O. Carter in Santa Ana.
Michael Schachter, his criminal defense attorney, did not respond to messages seeking comment.
In the civil case, an arbitrator in May ordered Makhijani to pay Laguna Beach real estate mogul Mohammad Honarkar $1.34 billion after ruling he had fraudulently induced him into a 2021 joint venture — and then wrested control and lost to creditors more than two dozen properties Honarkar had owned.
Makhijani has not been criminally charged in that case, but prosecutors alleged in an affidavit in support of the bank fraud charges that he used “force and threats” in his dealings with Honarkar and others — including taking over the landmark Hotel Laguna in 2023 that Honarkar was renovating.
Prosecutors sought to hold Makhijani without bail after his arrest.
The affidavit noted he is a legal Indian immigrant with a home and bank accounts in that country, has access to private jets and threatened to “run away” if caught in a difficult situation.
The request was denied and he was granted $500,000 bail.
However, Makhijani remains in custody after a hearing sought by prosecutors last month before Magistrate Judge Autumn Spaeth.
The judge declined to accept a $450,000 cashier’s check submitted by a Makhijani associate for the bail, finding insufficient proof the source of the funds was legitimate, according to court records.
Makhijani is not prominent outside Orange County real estate circles, but he established a thriving distressed-assets business over the last decade that attracted prominent Southern California real estate investors.
Prosecutors said it paid for a lifestyle that included two multimillion-dollar homes in Corona del Mar, a luxury apartment in Newport Beach and various luxury vehicles.
As of last month, prosecutors had not fully traced his assets, which they believe are not held in his name and some of which may be in India.
The businessman employed an array of shell companies and strawmen to sign documents on his behalf, and to stand in for him as operators of his companies, according to the affidavit.
Makhijani told an associate he took extra precautions because wanted to insulate himself from litigation and that “they were sharks in the distressed world who took advantage of people,” the affidavit stated.
-
Indiana7 minutes agoBaby abducted in Marshall County found safe in northwest Indiana
-
Iowa9 minutes agoIowa City Man who ran over people in homeless encampment sentenced to nearly two decades in prison
-
Kansas14 minutes ago
Kansas Lottery Mega Millions, Pick 3 winning numbers for July 7, 2026
-
Kentucky21 minutes agoUS 51 Cairo bridge to remain closed for period of time
-
Louisiana24 minutes agoHeart of Louisiana: Lafitte Wetlands
-
Maine30 minutes agoMaine’s 10 most expensive home sales from June
-
Maryland37 minutes agoMaryland Lottery Mega Millions, Pick 3 results for July 7, 2026
-
Michigan39 minutes agoMichigan Supreme Court rules rape admission invalid due to LSD use