Paramount Skydance officials were recently deposed by the Trump administration’s antitrust cops as the media giant pushes for quick regulatory approval of its $81 billion deal to purchase Warner Bros. Discovery, On The Money has learned.
The powwow on the merger – which has raised hackles with left-wing media types who have claimed it will spark an employment crisis across Hollywood – took place between two senior Paramount executives and the DOJ about two weeks ago, according to people with direct knowledge of the matter.
In an unusual twist, lawyers for the burgeoning conglomerate known as PSKY invited about a half-dozen state attorneys general to listen in via Zoom, the sources said.
Among them were reps for New York Attorney General Tish James and California Attorney General Rob Bonta; Bonta has recently suggested he might seek litigation to block the merger after hearing concerns from progressive Hollywood types such as actor Mark Ruffalo and progressive legal activists like Norman Eisen of the Democracy Defenders Fund.
On paper, opposition to the deal centers on the notion that the combination will lead to fewer jobs and less competition. Eisen & Co. produced a letter with more than 1,000 signatories calling on state AGs to block it through litigation.
People close to Paramount believe the real opposition is political. Paramount Skydance’s leadership led by David Ellison is demanding more centrist news and entertainment programming at the burgeoning media company that owns CBS, Paramount Pictures and, if the deal is approved, the CNN cable news network, HBO Max and the Warner Bros. film studio.
Eisen served as an ambassador in the Obama administration and was co-counsel for the House Judiciary Committee’s 2020 impeachment of president Trump. A rep for the Democracy Defenders Fund referred me to a press release where Eisen said “This proposed merger would not only harm competition and creativity, it would erode the very bedrock of our democracy.”
What opponents leave out is that Warner Bros. Discovery has been culling jobs since its 2022 inception with the combination of the ailing Warner Media with Discovery under CEO David Zaslav. Of note, the $31 a share deal was a significant premium to WBD’s price of around $8 before bidding began in the summer, a sign that Wall Street investors believed the company’s future as a standalone entity was particularly bleak.
Those were the points PSKY reps made to the DOJ and the state AGs who attended the recent six-plus-hour deposition and meeting with regulators, On The Money has learned. They also noted the deal has won support from media executives who see how cord cutting and streaming has upended their business, and how Paramount will literally save jobs if the deal goes through.
“Unless this deal gets challenged the plan is to have it closed by July,” said one person with direct knowledge of the matter. “(Paramount) is planning to close the Warner deal 48 hours after it gets regulatory approval by the DOJ. But that’s if it doesn’t get challenged by the states.”
Paramount CEO David Ellison and his father, Oracle co-founder and Trump supporter Larry Ellison, expect the DOJ antitrust to greenlight the deal. But they’re not taking any chances. They and their general counsel, former Trump 1 DOJ antitrust chief Makan Delrahim, have tapped major antitrust litigators including Jeffrey Kessler.
The latter is the co-executive chairman of Winston & Strawn and co-lead counsel on the so-called House settlement case, the landmark antitrust class action that helped create the “Name Image and Likeness” system in college sports.
The employment argument, sources close to Paramount say, is a canard because WBD was in such a weak pre-merger position with piles of debt, a wonky business model and competition from bigger players that it needed a deal. The antitrust case is also weak since there’s almost no overlap between the two companies that will lead to consumer harm.
But the progressive left is worried that the Ellisons will demand more centrist programming at WBD including its cable news network, CNN, as it has done with CBS, which they acquired before the WBD transaction.
A press rep for Bonta told On The Money: “The Paramount acquisition of Warner Brothers remains an active investigation, and we do not have any updates to share at this time.” A press rep for Tish James, whose office is also scrutinizing the deal, declined comment. James’s litigators, while invited to view the deposition, declined to show up after refusing to abide by confidentiality rules, a person with knowledge of the matter says.
A press official for Paramount Skydance had no comment, and an official at DOJ antitrust declined comment. A press rep for Ruffalo didn’t return a request for comment.
