Court Okays PSKY Settlement With State AGs

A federal judge on Wednesday approved Paramount Skydance’s settlement with 12 state attorneys general, clearing the last major legal barrier to its roughly $110 billion acquisition of Warner Bros. Discovery and putting David Ellison on track to close the deal as soon as next week.⁠

U.S. District Judge Araceli Martínez-Olguín signed off on the consent decree, writing that the agreement is a “fair, reasonable, and good faith” way to address the competition harms alleged in the states’ lawsuit and does not violate the law or public policy. Paramount has tentatively aimed to complete the purchase around Oct. 6, when its Class B shares are expected to begin trading on the New York Stock Exchange after a planned move from Nasdaq on Oct. 5. Ellison had said after the Sept. 21 settlement that the merger could close in about two weeks.⁠

The California-led coalition—Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington—sued in July to block the combination of two major studios, Paramount+ and HBO Max, and news brands including CBS and CNN. Federal regulators and overseas authorities had already cleared the transaction. The states and the Writers Guild of America settled last week, lifting a court pause that had kept the deal from closing. The timing also helps Paramount avoid a “ticking fee” of about $7 million a day that would have been owed to Warner shareholders if the deal slipped past Sept. 30.⁠

Judge Martínez-Olguín

Under the five-year, court-enforceable settlement, the combined company must release at least 30 theatrical films a year for the first two years and 32 a year for the next three, including wide releases and a share of higher-budget titles, plus a minimum number of independent films. It pledged to spend at least $1.5 billion more on U.S. production over five years than the companies spent in 2025—about $300 million extra per year—and agreed not to sell or close its major Los Angeles studio lots. A $47.5 million workforce fund is meant to help employees affected by the merger. Failure to meet film-release terms can trigger penalties, including possible divestiture of Miramax.⁠

The decree also requires separate negotiations for Paramount and Warner basic-cable channels, an independent monitor, and editorial-independence boards of journalists for CNN and CBS News. California Attorney General Rob Bonta called the result a strong antitrust outcome for workers and consumers but said it was “not a vote of support” for the merger itself. Ellison said the company now had “complete clearance” and framed the commitments as a way to put more films into theaters and production work in the United States.⁠

The takeover, after a year-long fight that included a bidding war that displaced an earlier Warner agreement with Netflix, would create one of the largest media companies in the world—and leave the combined firm with an estimated $80 billion in debt. Closing now shifts the story from whether Ellison can buy Warner Bros. Discovery to how he runs it.⁠