Judge orders pause on Paramount-Warner merger after challenge from 12 states

A federal judge on Monday ordered Paramount and Warner Bros Discovery to halt their $81bn merger for at least two weeks, allowing states that are challenging the deal more time to see their case through in court.

Twelve states, led by California, sued to block Paramount’s pending buyout of Warner last week – alleging that such a combination would “extinguish competition” in Hollywood and lead to fewer choices for consumers, particularly moviegoers and cable customers across the US.

The states’ top prosecutors called on Warner and Paramount to not close the transaction until after a court had time to “fully evaluate” their claims. And when the companies refused, they filed for a temporary restraining order – which is what district judge Araceli Martínez-Olguín granted on Monday. That opens the door to a potential preliminary injunction that the states are also seeking to effectively block the deal.

“This is a critical first win in our case to ensure this megamerger never sees the light of day,” Rob Bonta, the California attorney general, said in a statement following Monday’s order. “History tells the tale of what happens when a few people have great power over markets that are central to Americans’ lives: fewer opportunities for more people, worse products and services for all people.”

A Warner-Paramount tie-up would bring together two of the five last legacy studios in Hollywood – as well as host of TV networks, titles filling streaming libraries and news operations. That would include Warner’s HBO Max, fan favorites such as Harry Potter and even CNN coming under the same roof of Paramount-owned CBS, movies including Top Gun and the Paramount+ streaming service.

Paramount did not immediately comment on Monday’s order. But the company, which was bought out by Skydance just last year, has vowed to “vigorously defend” its Warner acquisition. Paramount previously called the states’ complaint “wrong on both the facts and the law”, maintaining that a merger would instead strengthen competition against bigger entertainment rivals. And it touted regulatory greenlights the deal has received elsewhere, including from the Trump administration last month.

The temporary restraining order granted on Monday halts the deal from progressing for at least 14 days, although the pause could be extended for up to 28 days. The court has set 3 August as a date for a hearing on the states’ preliminary injunction motion, although that schedule could also be pushed back.