Paramount Skydance says California AG's TV remarks contradict bond arguments

On Sept. 8, Paramount Skydance asserted that California Attorney General Rob Bonta's televised remarks undercut his legal arguments against the company's request for a $1.88 billion bond in the Warner Bros. Discovery merger case.

The company is seeking to shield itself from the cost of delaying its push to become a major rival to Netflix and Disney, as California and other parties seek to block the deal as unlawful.

Paramount contends the bond is necessary so it can recoup losses if it prevails in lawsuits brought by a California-led coalition of states and the Writers Guild of America. By the time the case is scheduled to conclude in April, Paramount says it will have paid $1.3 billion in fees to Warner Bros. shareholders.

One of Bonta's objections to the bond is that Paramount voluntarily agreed to pause the deal's closing, rather than waiting for a judge to impose an injunction that would halt the transaction.

However, Paramount pointed out that Bonta described the pause as equivalent to an injunction during television interviews, arguing that antitrust law requires the states to post a bond.

Bonta's office did not immediately respond to a request for comment.

U.S. District Judge Araceli Martinez-Olguin in Oakland has scheduled a hearing on Paramount's bond request for Sept. 24.

In July, California and 11 other states filed suit to block the deal, claiming it would create a media behemoth with the power to raise prices across film and television. The Writers Guild of America also sued, arguing it would worsen working conditions and compensation for writers.

Paramount has maintained the deal would strengthen the film and TV industry and lead to more, rather than less, content.

Although Paramount and Bonta have both expressed willingness to negotiate, Bonta has said the states are ready to go to trial if a potential settlement does not satisfy their concerns.