A dozen US states are taking legal action to block Paramount’s £80billion takeover of Warner Bros, arguing that the blockbuster deal would reduce competition in film and television.
The lawsuit, which was filed by Democratic states including California and New York, poses a serious threat to Paramount’s plans to bring together two of Hollywood’s five largest film studios to take on Netflix and Disney.
Even if the deal still goes through, any delay could be costly for Paramount, as it has agreed to pay a fee of around £550million per quarter to Warner Bros shareholders if the transaction is not completed by the end of September.
California Attorney General Rob Bonta said: ‘With this lawsuit, California and our sister states are fighting for free and fair markets, not rigged markets.
‘The unlawful merger of these two entertainment behemoths would lead to higher prices, lower quality and less content for film and television, harming movie theatres, basic cable distributors, and, ultimately, audiences on every sofa and movie theatre seat in the US. America has no kings in government or our economy.’
