Judge halts Paramount's $110 billion acquisition of Warner Bros. Discovery

A federal judge has ordered a 14-day halt to Paramount's merger with Warner Bros. Discovery, siding with a 12-state coalition arguing the deal would violate antitrust law and lead to higher prices and fewer movies and TV shows.

Judge Araceli Martinez-Olguin granted the temporary restraining order Monday, writing that the states raised serious questions going to the merits and that Paramount acknowledged it would not be harmed by a delay through the end of September. Both companies will continue operating as separate competitors while the case proceeds. The order could stretch to 28 days, with a preliminary injunction hearing set for August 3.

California Attorney General Rob Bonta called the ruling a critical first win in the effort to ensure the megamerger never closes.

The states allege the deal would combine two of the top three cable programmers and two of the top five film distributors. Paramount counters that new entrants like A24 and Amazon MGM have made the theatrical market more dynamic, and that the merger would create a stronger streaming rival to Netflix. The judge rejected that efficiency argument in a footnote.

The stakes are steep: if the deal has not closed by September 30, Paramount begins owing Warner Bros. investors millions of dollars a day.