The pressure to settle the merger lawsuit is now coming from inside Bonta’s own state house.
Per a Wall Street Journal scoop, California Governor Gavin Newsom’s office has encouraged Attorney General Rob Bonta to settle the state’s antitrust lawsuit against the $110 billion Paramount-Warner Bros. merger out of court.
Newsom’s warning, per the report: block this deal, and California entertainment jobs suffer.
What The WSJ Reported
In recent weeks, Newsom has told people involved in the case that stopping the merger would hurt employment in the state.
His administration has urged Bonta, who runs the 12-state lawsuit, to find an out-of-court deal instead.
Newsom, Bonta, and Paramount all declined to comment.
Wall Street said plenty, though. Warner Bros. Discovery stock jumped about 3.2 percent Friday, its best day in nearly eight months, on the news.
Our Insiders Called It
Two weeks ago, our insiders told us exactly where this was heading.
They said Ellison’s federal film tax credit push in Washington was about making concessions to the suing states, and that Paramount was “confident States will withdraw their lawsuits.”
Now the governor of California is pushing his own attorney general toward the exit.
And remember, Paramount’s settlement offer has been sitting on Bonta’s desk since before the lawsuit was even filed, according to Paramount’s legal chief Makan Delrahim.
Why Newsom Blinked
Jobs. And leverage.
Tennessee’s deputy governor has already invited Paramount to move its corporate offices out of California, and Delrahim says multiple states have come calling, though Paramount says it has “committed to be in California,” with the final call being David Ellison’s.
No governor with bigger ambitions wants to own the headline “Paramount leaves California.”
It also comes three days after Ari Emanuel made the same jobs argument in the WSJ, calling the lawsuit “trash.”
Hollywood keeps picking sides, and the pro-deal side just added the governor.
The Problem: Bonta Isn’t Newsom
The attorney general is independently elected. Newsom can push, but he cannot order.
And Bonta has been maximalist from day one: promises don’t count, only “structural remedies” do, meaning pieces of the company staying separate or being sold. He even called Paramount’s California exit talk “blackmail.”
So the governor wants a handshake, and his attorney general wants a scalpel.
Meanwhile, the clock runs.
With the deal frozen until a trial verdict, as late as June 2027, Paramount is reportedly pushing for a fast-tracked November trial to beat its $650 million-per-quarter penalty clock.
Our insiders said the settlement was “still a process.” The process now has the governor of California sitting on Paramount’s side of the table.
