Paramount Skydance Corp. was sued in federal court by consumers seeking to block the company’s $110 billion acquisition of Warner Bros. Discovery Inc., alleging the proposed deal will harm competition in the premium video distribution market, lower the quality of national TV news, and lead to fewer theatrical films.
The proposed acquisition “increases Paramount’s ability and incentive to raise consumer prices and worsen consumer-facing terms, reduce theatrical output, and diminish independent editorial rivalry and the quality and diversity of news programming,” according to a complaint filed Thursday in the US District Court for the Northern District of California.
The suit, brought by moviegoers and TV news consumers, seeks relief under the Clayton Act, which prohibits mergers that lessen competition and gives private individuals the right to sue. The plaintiffs seek a court injunction blocking the deal as well as an order divesting Paramount Skydance of any interest in Paramount Global.
The suit also alleges Skydance’s acquisition of Paramount Global violated Section 7 because it “eliminated Skydance as an independent producer of premium film and television programming.”
Paramount announced in February that it entered a merger agreement to purchase global media and entertainment company Warner Bros. The company outmaneuvered its rival
Paramount didn’t immediately respond to a request for comment on the lawsuit.
Paramount’s portfolio of brands include Paramount Pictures, Paramount+, Pluto TV, as well as CBS News, CBS Sports, Nickelodeon, MTV, BET, Comedy Central and Showtime. Warner Bros. owns the Discovery Channel, film and TV studios HBO Max and HBO, as well as HGTV and the Food Network.
The plaintiffs allege the proposed deal will lessen competition in three alleged relevant markets: premium video programming distribution, national television news programming, and theatrical distribution. Relevant markets outline the scope of competition and include all products and services consumers could see as substitutes based on price and quality.
“If Paramount’s proposed acquisition of Warner Bros. Discovery is consummated, the combined firm would have increased ability and incentive to reduce theatrical film output and narrow release slates, substantially lessening competition by leaving moviegoers with fewer theatrical titles, less genre and budget variety, and fewer meaningful alternatives at local theaters,” the plaintiffs allege.
The consumer plaintiffs are represented by the Alioto Law Firm and Foreman & Brasso.
The case is Faust v. Paramount Skydance Corp., N.D. Cal., No. 3:26-cv-03790, complaint filed 4/30/26.
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