A federal judge in California has ordered Paramount Skydance Corp. and Warner Bros. Discovery to halt their merger for at least two weeks. Judge Araceli Martínez-Olguín granted a temporary restraining order on Monday, pausing the deal for 14 days after stating the merger likely violates antitrust laws.
The ruling follows a lawsuit filed last week by a coalition of 12 states, led by California Attorney General Rob Bonta. The states argue that the acquisition, valued between $81 billion and $111 billion, would violate the Clayton Act and extinguish competition in Hollywood. The coalition alleges the combination would harm movie theaters, basic cable distributors, and audiences, leading to fewer choices for consumers.
The legal challenge serves as a direct challenge to the Trump administration's Justice Department, which approved the merger last month. California Attorney General Rob Bonta hailed the restraining order as a critical first win to ensure the megamerger never occurs.
The pause disrupts Paramount's plan to be in control of its rival by the end of the week. Additionally, the company faces significant financial risks, as Paramount could be liable for $650 million in quarterly fees if merger delays extend beyond September per the agreement terms.