Paramount-California standoff deepens as antitrust talks collapse over $110b deal

Tensions between Paramount Skydance — which is pursuing a major merger with Warner Bros. — and the California state government are escalating.

California Attorney General Rob Bonta abruptly canceled a Sunday evening meeting with Paramount over the antitrust lawsuit, The New York Times reported Sunday (local time).

Bonta said in a statement that Paramount had acted in bad faith by leaking and distorting the contents of the negotiations. Paramount declined to comment.

Earlier this year, Paramount signed a deal to acquire Warner Bros. Discovery for $110 billion. Having cultivated a friendly relationship with President Donald Trump, Paramount cleared the Justice Department's antitrust review and secured approval from the EU and the United Kingdom. Antitrust lawsuits filed by Democratic-led state governments have halted the merger process until either June 1 next year or five days after a federal court ruling.

Amid the dispute, Paramount has signaled it could relocate its headquarters out of California. According to The Hollywood Reporter, Tennessee's lieutenant governor sent Paramount a letter formally proposing the move — a development that could deal a significant blow to California's jobs and tax revenue.

Paramount has also gone on the offensive, demanding that California and 11 other states, along with the Writers Guild of America, deposit a combined $1.9 billion with the court.

California and Paramount had since been in negotiations aimed at resolving the antitrust dispute, before those talks broke down Sunday.