Paramount seeks $1.88 billion bond from states over WBD merger delay

Paramount Skydance asked a federal judge to force 12 states and the WGA to post a $1.88 billion bond covering losses from the delayed $111 billion Warner Bros. Discovery merger.

"Both the Clayton Act, the federal antitrust law upon which these suits are based, and other federal law expressly provide that plaintiffs are required to post a bond covering the potential harm from halting a transaction to litigate, so that if they lose, the injured party has a source of recovery for the damage caused," a Paramount spokesperson said.

The bond figure of $1,884,726,092.73 reflects the maximum potential ticking consideration of roughly $7 million per day starting Oct. 1 plus financing costs, the company said. That ticking fee alone would exceed $1.2 billion by the time the trial concludes in March 2027.

The motion, filed Monday with Judge Araceli Martinez-Olguin, asks the court to dissolve the order blocking the merger unless plaintiffs post the bond by Sept. 30. The antitrust suits by the states and WGA are the only remaining barriers to closing a deal that has received regulatory clearances from 68 jurisdictions.

The request marks a sharp escalation in Paramount's public pressure campaign since California Attorney General Rob Bonta and 11 other states sued in July to block the transaction on competition grounds. The states allege the merger would illegally reduce competition in theatrical and blockbuster film markets and basic cable television. The Writers Guild of America filed its own suit arguing the deal would shrink the number of buyers for writers' work.

Judge Martinez-Olguin had previously waived a bond requirement when granting a temporary restraining order, noting that "Plaintiffs have demonstrated that Plaintiff States bring suit to enforce important public interests." Paramount now argues that the prolonged litigation timeline — with a trial set for March 2027 — imposes quantifiable financial harm that plaintiffs should cover.

The bond request draws on a legal precedent that cuts both ways. In the separate Nexstar-Tegna antitrust case, U.S. District Court Judge Troy Nunley of California's Eastern District required plaintiffs to post a nominal $10,000 bond, noting that courts have "issued bonds in nominal amounts where a state is advocating for the public interest." Paramount's $1.88 billion ask stands in stark contrast to that precedent.

Ticking Fee and Financial Exposure

Paramount added a provision to its WBD bid requiring it to pay Warner Bros. Discovery shareholders a "ticking fee" of roughly $7 million per day starting Oct. 1 until the merger closes. With the trial scheduled to run through March 2027, that obligation would total more than $1.2 billion — a figure Paramount says is only part of the damage.

"By virtue of what will be at least an eight-month delay in closing, there will be no integration and no ramped-up investment in content, production and creative talent by the combined company," the spokesperson said. "Employees of both Paramount and WBD are also harmed by the uncertainties caused by the delay."

Bonta rejected the framing, accusing Paramount of attempting to "blackmail the state into letting an illegal deal through." He told MS Now's "State of Play With Peter Alexander" that settlement talks remain open but that "Paramount, Warner Bros. breaking the law and expecting us to let them get away with it, that is not on the table and never will be on the table."

Labor Unions Split Over Strategy

The prolonged timeline has fractured Hollywood's labor movement. Directors Guild of America and IATSE leaders sent a letter to Bonta and Ellison calling for a settlement or expedited trial, warning the delay is "damaging to an already struggling industry." The WGA, which filed its own suit, supports the states' position. SAG-AFTRA backs the antitrust action but wants "enforceable safeguards" through a settlement, while the Teamsters have called for conditions on the deal.

The split reflects divergent exposure: IATSE members logged nearly 36 percent fewer hours in 2025 versus 2022, and DGA employment has fallen 40 percent since 2022, making short-term production uncertainty existential for crew workers. Writers, whose labor cannot be outsourced as easily, face a longer-term threat from reducing five major studios to four.

Paramount's legal team, led by Makan Delrahim — the former chief antitrust enforcer in the first Trump administration — has also threatened to begin moving operations out of California starting Oct. 1 if the case isn't resolved. The company maintains the deal is pro-competitive and that all global regulators who reviewed it have cleared it.

If the bond motion succeeds, it could force the states to weigh the political cost of putting taxpayers on the hook for billions in potential damages — or drop the case. If it fails, Paramount faces at least eight more months of ticking fees and operational uncertainty.

This article is for informational purposes only and does not constitute investment advice.