Oregon joins multistate lawsuit seeking to block Warner Bros.-Paramount merger

Oregon Attorney General Dan Rayfield and attorneys general from 11 other states filed a lawsuit Monday seeking to block Paramount Skydance Corp.’s proposed $110 billion acquisition of Warner Bros. Discovery, arguing the merger would reduce competition and ultimately raise costs for consumers.

The lawsuit, filed in the U.S. District Court for the Northern District of California, alleges the merger violates the Clayton Act by substantially lessening competition in the film and television industries.

California, Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York and Washington are the other states involved in the lawsuit.

The coalition said it is prepared to seek a temporary restraining order if the companies do not pause the deal as the case moves forward.

“If this massive corporate merger is allowed to go through, Oregonians will pay the price – through higher bills, fewer jobs, less choice at the box office, and fewer editorial voices,” Rayfield said in a press release on Monday. “Despite the federal regulators rubber-stamping this bad deal, we’re stepping up to protect families, small businesses, and Oregon’s film industry.”

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According to the lawsuit, the combined company would control nearly one-third of U.S. theatrical film distribution and basic cable programming. The states argue the merger would eliminate competition between two of Hollywood’s five major film distributors and two of the nation’s five largest basic cable companies.

The complaint alleges the merger would reduce competition in theatrical film distribution, blockbuster movie releases and licensing basic cable television channels.

The filing follows Oregon’s investigation into the proposed merger. In early July, Rayfield asked a Multnomah County judge to compel Paramount to produce records the state said it had sought since June, including documents related to the company’s lobbying of the White House and U.S. Department of Justice.

“Paramount has already shown that they think they’re above the law by refusing to comply with Oregon’s investigation,” Rayfield said. “This litigation is the next step to protect Oregonians before irreparable harm is done.”

The U.S. Justice Department isn’t challenging the deal — and instead released an unusually lengthy statement in support, maintaining a Paramount-Warner combo would “increase competition across the media and entertainment ecosystem, with benefits for American consumers and workers,” according to a report from the Associated Press.

In a statement sent out on Monday, Paramount said the lawsuit “distorts settled antitrust law” and maintained its merger would create a “stronger competitor against dominant streaming and technology platforms who have harmed the market for theatrical exhibition and jobs in the entertainment industry.” Paramount went on to say it will “vigorously defend” the transaction.