Paramount has struck a settlement with 12 states to resolve an antitrust case, clearing a major hurdle for its takeover of Warner Bros. Discovery, which is set to become the biggest merger in Hollywood history. The details of the agreement, reached after a marathon weekend of negotiations, have now been made public.
Under the terms, Paramount has committed to keeping its operations in California and has pledged not to sell the Paramount Studios or Warner Bros. lots in the state for at least five years. That commitment follows a threat from Paramount Skydance chief David Ellison, who had warned he might pull the company out of California if the WBD deal wasn't closed by Oct. 1.
The settlement also requires Paramount to increase its U.S. film production spending by an additional $300 million annually, bringing the total to at least $1.5 billion, while committing to release a minimum of 30 movies for theatrical distribution each year — a promise Ellison has made repeatedly.
On the news side, Paramount has agreed to establish a third-party "news editorial independence board" to oversee the operations of CNN and CBS News, a step designed to protect their editorial independence under the company's ownership.
The obligations are set to run through the fifth calendar year following the closing of the merger. If the deal closes before the end of this year as expected, that would place the settlement's expiration at Dec. 31, 2031.
David Ellison said in a statement: "We are grateful to Attorney General Bonta and his fellow AGs, as well as the WGA, for engaging in good faith to find a path forward to a resolution that serves all parties, and to Governor Newsom for his support throughout this process. Our shared aim was an outcome that best serves consumers, workers and — most importantly — the creative community so vital to the art of visual storytelling. We're confident this agreement does exactly that, memorializing a series of commitments that include 30+ films annually and expanded U.S. film production to help revitalize our industry here at home."
The combined Paramount-Warner Bros. entity will face penalties, including the potential divestiture of assets, if it fails to meet the settlement's requirements. The proposed settlement still requires approval from the judge overseeing the case before it can take effect.
*Photo: Jinghui Zhang, Claudia A. Benavente, Justina McEvoy, Jacqueline Flores-Otero, Li Ding, Xiang Chen, Anatoly Ulyanov, Gang Wu, Matthew Wilson, Jianmin Wang, Rachel Brennan, Michael Rusch, Amity L. Manning, Jing Ma, John Easton, Sheila Shurtleff, Charles Mullighan, Stanley Pounds, Suraj Mukatira, Pankaj Gupta, Geoff Neale, David Zhao, Charles Lu, Robert S. Fulton, Lucinda L. Fulton, Xin Hong, David J. Dooling, Kerri Ochoa, Clayton Naeve, Nicholas J. Dyson, Elaine R. Mardis, Armita Bahrami, David Ellison, Richard K. Wilson, James R. Downing, Michael A. Dyer, Stevenfruitsmaak,
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