A top Justice Department official is minimizing the concessions state attorneys general received in the settlement of their antitrust lawsuit to block the Paramount–Warner Bros. Discovery merger.
Stanley Woodward, associate attorney general, said in a statement on Tuesday, “After a thorough review of the Paramount/WarnerBros deal, DOJ concluded that market dynamics create the necessary incentives to protect competition.
“The only antitrust related provisions in the States’ settlement require that Paramount honor its already-stated commitments to maintain and grow its movie and TV businesses.”
The DOJ signed off on the $111 billion merger in June, with no concessions from Paramount of requirements of divestitures. Merger opponents criticized the DOJ’s review as insufficient amid Paramount’s wooing of the Trump administration and the next month, a dozen state attorneys general sued to halt the transaction.
But a settlement was announced on Monday that includes a set of behavioral conditions last for five years, including a commitment by Paramount to release 30 films for the first and second years, and 32 films for the third, fourth and fifth years. The consent decree also includes a theatrical release window of at least 45 days. Paramount CEO David Ellison had previously stated that he would commit to such windows and to the 30-movies-per-year releases.
Woodward said in his statement, “Consumers benefit when transactions close quickly after federal enforcers have concluded a substantive review. Under President Trump’s leadership, DOJ will continue to prioritize affordability for all Americans across our economy.”
At a press conference on Monday, California Attorney General Rob Bonta, who led the 12 states in the litigation, repeatedly said that the settlement would be an “enforceable commitment,” including that it would “significantly increase domestic production in the United States, and necessarily production right here in L.A., in Hollywood.” Among other things, he said, Paramount also would spend $300 million more each year in domestic film production, while agreeing to conduct Paramount and Warner Bros. cable channel negotiations independently. The settlement also includes an independent monitor to oversee compliance, Bonta’s team noted.
Bonta had previously indicated that only a structural remedy — like a commitment to divest assets — would suffice when it came to a settlement. The consent decree does contain requirements to sell off Miramax and selected cable channels if there are breaches of the settlement terms.
Just last week, before the settlement was reached, the DOJ sided with Paramount in its motion to require that the state AGs put up a $1.88 billion bond as the litigation dragged on. The trial had been scheduled for March, but Paramount faced having to pay a $7 million per day ticking fee to Warner Bros. Discovery for each day that the merger didn’t close after Sept. 30.
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