A group of 12 state attorneys general filed a lawsuit Monday challenging Paramount Skydance’s proposed acquisition of Warner Bros. Discovery.
The lawsuit, which came after weeks of speculation on if and when it would be filed, seeks to block the merger on antitrust concerns. CNBC’s David Faber reported earlier in the day that the lawsuit was expected to come on Monday.
The merger deal would combine two storied film studios — Paramount and Warner Bros. — as well as streaming platforms Paramount+ and HBO Max. Paramount CEO David Ellison has previously said the streaming services would become one following the transaction.
It would also mean the formation of the largest portfolio of TV networks in the U.S., bringing together Paramount’s broadcast network CBS and pay TV channels like MTV and BET with WBD’s CNN, TNT and others.
Led by California Attorney General Rob Bonta, the lawsuit, which was filed in the U.S. District Court for the Northern District of California, is also brought forth by attorneys general of Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington.
“The unlawful merger of these two entertainment behemoths would lead to higher prices, lower quality, and less content for film and television, harming movie theaters, basic cable distributors, and ultimately, audiences on every sofa and movie theater seat in the U.S.,” Bonta said in a release.
In a lengthy statement released on Monday, a Paramount spokesperson called the lawsuit a “misrepresentation of competition in the entertainment industry today,” adding that it plans to “vigorously defend the transaction and demonstrate that this challenge is inconsistent with sound competition policy and the competitive realities of the media marketplace.”
“Delaying this transaction will only harm entertainment workers who have already suffered over recent years as technology has disrupted their livelihood and cost California tens of thousands of entertainment jobs,” Paramount’s statement continued.
The lawsuit filed Monday raised concerns about the size of the combined company, adding that the merged entity would control nearly one-third of films and nearly a third of basic cable TV programming.
The attorneys general asked Warner Bros. and Paramount not to close the merger until after the judicial process concludes and threatened to file a temporary restraining order if they didn’t comply.
On Monday, Bonta held a news conference in front of the Hollywood sign in Los Angeles reiterating the points made in the lawsuit.
“This merger would snuff out competition, drive up prices, diminish content quality, and produce fewer movies and shows each year,” Bonta said during the event. “We have antitrust laws and merger controls for a reason, because competition is the lifeblood of a healthy and vibrant economy.”
Paramount countered in Monday’s statement, saying that the merger would “create a stronger, well-capitalized, creative-first…
Read More: Paramount, WBD hit with lawsuit from 12 states to block merger
