Paramount and Rob Bonta Finalize Dates For Merger Lawsuit Settlement Talks

Paramount is set to hold settlement talks with California Attorney General Rob Bonta and the Writers’ Guild of America on Oct. 14 and 15, per a new court filing on Tuesday. The discussions come as Bonta, 11 other state AGs and the labor union are suing to block the $110 billion deal, with an antitrust trial slated for March. On Friday, a judge ordered the both sides to meet and finalize a date for a settlement in late October. At the time, a spokesperson for Bonta’s office told TheWrap the discussions are “standard course” in the legal proceeding and that it does “not indicate that a settlement is in progress.” While both sides have said they’re open to reaching a settlement, Bonta has argued that the David Ellison-led media giant needs to offer structural remedies, such as divestments, rather than behavioral remedies, like its pledge to release 30 films in theaters per year. In August, Bonta canceled talks with Paramount after accusing the media giant of leaking the details of its settlement negotiations. At the time, the Wall Street Journal reported that Bonta is interested in cable network divestitures and keeping Paramount and WBD’s film and TV studios operating separately and independently. At the time, Bonta told TheWrap he’d be open to a carve out of a “significant” portion of the combined company’s 50 basic cable channels, but declined to elaborate on specifics. Paramount has agreed to delay the closing of the WBD merger until five days after the outcome of a trial, or June 1, 2027, whichever is earliest. In addition to calling for a settlement, Ellison has threatened to begin the process of moving Paramount’s operations out of California if a deal can’t be reached ahead of an Oct. 1 deadline, when it will start accruing a $7 million per day ticking fee until closing. It has also requested that the states and WGA post a $1.9 billion bond to cover the ticking fee and other financing costs during the delay. A judge will make a decision on whether to impose the bond during a hearing on Sept. 24. The Los Angeles Economic Development Corporation estimates Paramount moving out of the state could result in the loss of up to $21.2 billion in annual economic output, 57,980 full-time jobs and $1.17 billion in state and local tax revenues. Meanwhile, an analysis ordered by the LA County Board of Supervisors estimates that the merger closing could put 4,500 local TV and film jobs and over 5,800 indirect or induced jobs from related small businesses at risk over the next three years. The economic impact of losing these jobs would be $1.26 billion in wages, $2.78 billion in economic value, $4.06 billion in total business output and $547 million in tax revenue, including $78.6 million in local taxes — most of which (63%) comes from property taxes. If the deal does not close at all due to regulatory matters, Paramount is on the hook to pay WBD a $7 billion termination fee. The outside date for the merger to close is June 4, 2027. More to come…