The lawsuit names Paramount Skydance Corporation—a newly formed entity combining David Ellison's Skydance and Paramount Global—as the acquirer and Warner Bros. Discovery, owner of HBO, CNN, and Warner Bros. Studios, as the target. The states allege the combined company would control nearly one-third of U.S. theatrical motion pictures and basic cable programming. The suit seeks a temporary restraining order to block the transaction while litigation proceeds. The merger is scheduled to close by September 30, 2026, with Paramount Skydance obligated to pay Warner Bros. Discovery a $650 million "ticking fee" each quarter if closing is delayed beyond that date.
The lawsuit directly contradicts the U.S. Department of Justice's approval of the deal on June 12, 2026, when federal regulators concluded the merger was unlikely to harm competition. Attorneys should monitor whether the states can obtain preliminary injunctive relief before the September deadline, as a successful restraining order could trigger substantial financial penalties and force renegotiation. The case signals a widening gap between federal and state enforcement priorities on media consolidation and may establish precedent for state-led challenges to deals already cleared by federal regulators.