As further media consolidation is poised to reshape Hollywood and local TV stations across the U.S., state attorneys general may represent the last line of defense.
Historically, state AGs have worked in tandem with federal regulators like the Department of Justice and Federal Trade Commission on antitrust enforcement. But under the Trump administration, M&A regulation has taken a radical turn.
“The federal government is retreating from its traditional role, abdicating its responsibility to enforce antitrust law and seemingly picking winners and losers,” California Attorney General Rob Bonta told TheWrap.
That’s forcing the state AGs to play a more central role in deciding whether some of the biggest deals in the U.S. will reduce competition and hurt consumers. Among them are the recently approved $6.2 billion merger of Nexstar and Tegna, which creates a massive local TV giant that reaches 80% of U.S. households, and Paramount’s pending $110 billion acquisition of Warner Bros. Discovery, which could eliminate or downsize one of the major U.S. studios and consolidate two historic news organizations — CBS News and CNN — under a single owner.
In the case of Nexstar-Tegna, DirecTV and state attorneys general led by California and New York sued to block the deal, warning it would “irreparably drive up consumer costs, reduce local competition, shutter local newsrooms and increase both frequency and duration of blackouts of key local teams and network programming.” Despite receiving federal approval by the DOJ and FCC and closing minutes later, a judge has put Nexstar-Tegna on hold with a temporary restraining order and will hear arguments on Tuesday — a victory that experts say could embolden the state AGs to more aggressively go after Paramount-WBD.
While Bonta has warned he’d be “vigorous” in California’s review of Paramount-WBD, he told TheWrap that state AGs are still weighing whether they’ll sue to block it as the regulatory review process continues to play out with U.S. and international agencies. He declined to disclose an exact timeline on when that may be decided, but emphasized they’re prepared to “act timely” if they choose to do so.
“We see the red flags with these two proposed mergers,” Bonta said. “We will ensure that the needed and necessary antitrust enforcement job required for these types of proposed mergers gets done, even if the federal government is abdicating their responsibility and refusing to do their job.”
Though the federal government’s “refusal to participate in good faith and do the job that needs to be done is unfortunate,” Bonta argued that state AGs have “concurrent jurisdiction” and can “do everything and anything the federal government can do.”
“If they won’t do it and we decide to do it, we have all the authority and power, weight of the law and standing to sue that they would have,” he said. “The cases will stand and fall based on the strength of the case, facts and law, not who’s bringing it. If the federal government is allowing mergers to occur that break the law, that doesn’t make our challenge to those cases any weaker, it just means that the federal government failed to do their job.”
In other words, game on.
Nexstar-Tegna is a critical moment
There’s been a mixed track record of success for state AGs. In 2024, they successfully blocked the Kroger-Albertsons merger, in which they were aligned with the FTC but secured a permanent injunction under a separate, independent challenge. But in 2020, they failed to block the closing of the Sprint-T-Mobile merger, which was approved by the DOJ with conditions, suggesting that federal approval still carries persuasive weight with courts.
Regulatory and government investigations attorney Braden Perry acknowledged that state AGs face structural disadvantages, such as “smaller litigation budgets, narrower statutory authority and state antitrust frameworks that weren’t designed to address national media consolidation.”
But he argues their enforcement posture in 2026 is “far more aggressive and sophisticated” than during Sprint-T-Mobile and that courts appear to be more receptive to the argument that “federal inaction or inadequate action doesn’t foreclose independent state review.” He added that an outright block isn’t the only measure of success for AGs, who can still extract meaningful concessions like divestitures, pricing commitments, or content access guarantees that reshape the final terms of a transaction.
“Whether or not any individual challenge succeeds, the cumulative effect is that dealmakers now have to factor state-level risk into their calculus from day one,” Perry said. “That’s a meaningful change in how these transactions get structured and negotiated.”
Experts said that the temporary restraining order against Nexstar-Tegna is a “significant moment” for state AG antitrust enforcement in the media space after Judge Troy Nunley found that DirecTV and state AGs established a likelihood of success on the merits of their lawsuit.
“If a court is willing to pause a closed transaction over state-level antitrust concerns when the federal government took a pass, it establishes that state AGs have viable enforcement tools in this space,” Perry added. “The broader signal is that dealmakers can no longer treat federal clearance as the finish line.”
In a Tuesday court filing, Nexstar said that a preliminary injunction will cause “immediate irreparable harm” to the combined company and viewers in communities across the United States — including local television stations that will “not get the benefits of enhanced journalism, technological upgrades, and other immediate investments Nexstar had planned to make.”
They added that DirecTV and the state AGs show “no proof of immediate irreparable harm,” argue the requested relief is “overbroad and unworkable” and that the case is “nothing more than an attempt by DirecTV to maximize its leverage” in upcoming negotiations.” Additionally, Nexstar said that the temporary restraining order can’t be fully complied with due to actions that were already taken and legal obligations that can’t be reversed.
But New Street Research analyst and former FCC chief of staff Blair Levin is skeptical that the company would prevail in the district court and that overturning the ruling would take several years at minimum.
“We think [Nexstar’s] best shot at overturning the District Court will be at the Supreme Court, but we are skeptical that the Supreme Court would take the case and further, that Court may not take the case until the 2028-2029 term,” Levin said. “That means a decision may not be reached until [the second quarter of 2029] and a new President and new FCC may take steps that undercut the [Nexstar] legal arguments.”
He expects that Nexstar will instead look to settle the case by divesting stations in local markets that concern the state attorneys general, but noted that the latter’s incentive to reach a settlement is “significantly reduced.”
Though Levin isn’t ruling out an intervention by the DOJ, he argued its credibility on the matter has “likely been undercut by their prior silence as well as President Trump’s directive to get the deal done.” He also doesn’t expect that any effort by the FCC to raise the national and local ownership caps would impact the process or outcome.
Meanwhile, Citigroup analyst Jason Bazinet believes the temporary restraining order could lead to a preliminary injunction and estimates the deal’s synergies could be lowered from $300 million to roughly $240 million due to station divestitures. But he doesn’t believe the “magnitude of potential synergy reduction is large enough to scuttle the transaction” and that it will ultimately close in 2027 or 2028.
What does the Nexstar-Tegna case mean for Paramount-WBD?
While the dynamics between the Nexstar-Tegna and Paramount-WBD mergers are different, experts argued that the former’s legal battle will have an impact on the latter deal.
Levin said the Nexstar-Tegna case could embolden state AGs by demonstrating that they can score significant antitrust victories even if the DOJ sees no harm. Perry added that the Nexstar-Tegna pause “likely accelerates Bonta’s timeline from investigation to action and strengthens his hand in any negotiation over concessions.”
“This is a proof of concept. Bonta and other state AGs now have a concrete example of a federal court stepping in post-close to halt integration of a media merger that cleared federal review,” he said. “Before [the temporary restraining order], there was a reasonable argument that state AG challenges to these deals were politically motivated but unlikely to produce real judicial outcomes. That argument is significantly weaker now.”
Though he previously met with Paramount CEO David Ellison during the bidding war with Netflix and is aware of and reviewing his recent public statements as part of California’s own investigation, Bonta warned that “red flags are everywhere” when dealing with this type of merger.
“You have to be concerned about the potential increase in prices for consumers of streaming and TV and films that studios make, the potential decreases to wages or the cuts of jobs, the reduced competition, the reduced quality, the reduced choice,” he said. “All those are potential impacts that we see when there’s corporate consolidation of this nature and we’re looking at that closely.”
Bonta expressed confidence state AGs would be successful in outright blocking the “presumptively illegal” Nexstar-Tegna deal, but downplayed the influence the case would have on a potential Paramount-WBD challenge.
“We have to make a decision on whether we act or not on Paramount-Warner Bros. before there’s any conclusion to the Nexstar-Tegna case,” Bonta said. “So they’re independent cases and we look at each one based on their facts. If we do decide to act, the one thing I can tell you about the timeline is we will not fail to act timely, but I have no idea when that will be.”
If Bonta and the other state AGs act, companies will have to pay attention.
“The important thing for dealmakers to know is that there are no free passes. You don’t get to break antitrust law,” he said. “ We will look, either with the federal government’s help and involvement or without, and we’ll be fair, we’ll be thorough and do the job that is required under the law.”
