A federal court in California temporarily blocked the merger of two major Hollywood studios — Paramount Skydance and Warner Bros. Discovery. The lawsuit was filed by a coalition of 12 states, citing a serious threat to market competition, reports infohub.kz.
Federal Judge Araceli Martinez-Olguin granted the request from California Attorney General Rob Bonta and representatives of 11 other states to freeze the deal. The court order blocks any steps toward the merger for at least 14 days. A hearing on whether to extend the ban for the entire duration of the trial is scheduled for August 3.
The plaintiffs argue that combining two of the five leading film distributors in the US violates antitrust law. According to the attorneys general, the deal would lead to higher prices, lower content quality, and harm theaters and cable operators. The combined market share could reach 27 percent.
Representatives of Paramount said they are grateful to the court for a swift decision that maintains the status quo during the proceedings. The company emphasized that they believe the deal is legal and beneficial for viewers and the industry as a whole. The court is expected to make a final decision in the coming weeks.