Paramount has accused Warner Bros. Discovery (WBD) of running an unfair auction process that tilts toward Netflix, claiming WBD abandoned a fair transaction and pursued a predetermined outcome favoring the streamer.
In a strongly worded letter to WBD CEO David Zaslav, Paramount's lawyers alleged the company abdicated its duties to shareholders by engaging in a "myopic process" biased against Paramount's bid.
According to The LA Times, the letter cited reports of WBD executive Gerhard Zeiler meeting European Commission officials in Brussels, where concerns were raised about excessive media concentration if the Ellison family (owners of Paramount via its Skydance merger) acquired WBD. Paramount called this potential "active sabotage" of its offer.
The dispute erupted as the auction nears its end, with bidders required to submit updated proposals by Thursday. Netflix, which has offered a largely cash bid (details undisclosed but analysts estimate up to $70 billion for WBD's studios, HBO, and streaming assets), appears to have gained an edge. Netflix has shown no interest in WBD's basic cable networks like CNN, TNT, and HGTV.
Analysts initially saw Paramount's advantages, including Ellison's wealth and reported ties to President Trump, who endorsed the Ellisons and suggested Paramount should control both CBS News and CNN.
But concerns arose over media concentration, including a Guardian report on White House discussions about firing certain CNN anchors disliked by Trump if Paramount prevailed.
The auction follows WBD's earlier plans to split into separate streaming/studios and cable divisions, now complicated by the bidding war. WBD's board continues evaluating proposals amid rising tensions between the companies' leaders.