California Attorney General Rob Bonta has been on a roll. Arguing that the Paramount-Warner Bros. merger will harm theaters and cable providers, he brought an antitrust suit in July and managed to stall the deal until next spring.
But his winning streak couldn’t last forever. Last week, Cinemark joined AMC and Regal in backing the merger. That defection prompted the exhibitors trade group Cinema United — once a staunch Bonta ally — to go wobbly and push for a settlement.
“The states’ case is weaker now than it was a week ago,” says William Kovacic, professor of antitrust law at George Washington University Law School, who has been following the case closely. “It is most helpful to have the victims testify. That’s typically a vital part of the narrative of illegality. … If you have significant customers who say, ‘We like it,’ that hurts the plaintiffs’ case.”
Paramount has tried various ploys to put political pressure on Bonta — op-eds, letters from allies, threats to leave California, politicians’ statements — which Bonta has largely brushed off. He canceled an Aug. 24 meeting with Paramount after details leaked and accused the company of “playing games.” But the cinema chains’ support for the merger is different, because it goes to the viability of Bonta’s case at trial.
