BOSTON – Massachusetts Attorney General Andrea Joy Campbell announced on Monday, July 13, that her office agreed to join a coalition of 11 other states in suing to block a proposed media merger.
The lawsuit argues that the $110 billion acquisition of Warner Bros. Discovery, Inc. by Paramount Skydance Corporation would “unlawfully reduce competition in the film and television industry and ultimately harm consumers.”
The coalition of states asked Warner Bros. and Paramount not to close the transaction while the litigation proceeds. Should the companies decline, the coalition will see a restraining order to prevent the merger from closing until a court can review.
The coalition sued in federal court in the Northern District of California. The lawsuit alleges the merger violates Section 7 of the Clayton Act, which prohibits mergers that may substantially limit competition or tend to create a monopoly, according to Campbell’s office.
The coalition of states argues that should the merger take effect, competition would be substantially limited in three areas:
- Wide Release Theatrical Film Distribution – If combined, Warner Bros. and Paramount would control 27 percent of the market. The merger would leave just four companies with 86 percent of the market (Disney, Universal, and Sony are the others)
- Anticipated Top-Grossing Theatrical Film Distribution – The new entity would control 30 percent of the market and the same four companies would control 93 percent.
- Licensing Basic Cable Television Channels – Warner Bros. and Paramount currently combine to control 27 percent of revenue.
The other states in the coalition filing this lawsuit are California, Arizona, Colorado, Connecticut, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington
