Los Angeles Mayor Karen Bass is urging David Ellison and California Attorney General Rob Bonta to “find common ground” and settle a lawsuit seeking to block the pending $110 billion Paramount-Warner Bros. Discovery merger.
“While there are varying perspectives on the proposed transaction, today we are united around one clear message: It is time for all parties to come to the table,” Bass said during a news conference on Thursday. “The continued uncertainty is not good for workers, not good for productions and not good for the future of this industry. Too many productions in L.A. are now at a standstill, which means Angelenos are out of a job and they’re not getting paid.”
“As mayor, I cannot stand by while the job security of thousands of hardworking union members is being put at risk. That is why we are calling on Paramount, Attorney General Rob Bonta, and all relevant parties to come together, engage directly and in good faith, and work urgently to find common ground and keep our vital industry in Los Angeles at a time when film and television production is already facing significant challenges,” Bass continued. “We cannot afford prolonged uncertainty that delays investment, puts production on hold, and creates greater instability for thousands of workers and family.”
Bass emphasized that any resolution must put workers and the “long-term health of our entertainment industry” at the center and include “meaningful and enforceable commitments” to keep Paramount and Warner Bros. Discovery in L.A. as well as maintaining jobs, productions, and investments in the region and California.
She added that Los Angeles is the “entertainment capital,” with “unparalleled talent, unlimited creativity, a skilled workforce and the highest amount of production space in the world” and that she is speaking up to “protect this legacy.”
“This is not about taking sides. This is about fighting for Los Angeles, standing up for our union workers, keeping Paramount here, and protecting the future of this industry,” she concluded. “L.A. has been home to the entertainment industry for generations, and we intend to do everything we can to keep it here.”
Bass’ call for a settlement comes after TheWrap was first to report a new study by L.A County’s Department of Economic Opportunity and CVL Economics, which found that the merger could result the loss of nearly 4,500 TV and film jobs over the next three years.
It could also risk 2,661 indirect jobs at small businesses that support production — such as prop houses, printers, transportation companies and other vendors — and 3,204 induced jobs that exist because film and TV workers spend money in the local economy — including restaurants, retailers and service providers.
Overall, the economic impact of losing these jobs would be $1.26 billion in wages, $2.78 billion in economic value, $4.06 billion in total business output and $547 million in tax revenue, including $78.6 million in local taxes — most of which (63%) comes from property taxes, per the study.
In a statement to TheWrap, Paramount said that Los Angeles County’s report underscores that the entertainment industry is “in decline, production is down and jobs are being lost — and lost for good if we don’t act.”
“Our plan to invest $30 billion annually in production and release at least 30 films a year is how we regain that ground: more production that supports more jobs over time, and ultimately, a stronger, more durable entertainment industry for generations to come,” the company added.
The $110 billion deal is currently headed to an antitrust trial in March. Paramount has agreed to delay the closing until five days after the outcome of a trial, or June 1, 2027, whichever is earliest. Starting Oct. 1, Ellison is on the hook for a 25 cent per share ticking fee, which translates to a payout of $7 million per day, or $650 million per quarter until closing. The final deadline for the deal to close is June 4, 2027.
While Ellison himself has called for a settlement, he has also threatened to begin the process to move Paramount’s operations out of the Golden State starting Oct. 1 if Bonta does not come to the negotiating table. Bonta has called the threat of a move “blackmail” and maintains that he is open to a settlement, but that Paramount needs to offer structural remedies, such as divestments, rather than behavioral remedies.
Experts have warned TheWrap that Paramount moving out of the state would be “devastating” for the L.A. entertainment community at a time when it has already faced cutbacks from the strikes and the end of the peak-TV era post-pandemic. They added that it would take years to execute and is “extremely dangerous” for Paramount from both an optics and financial standpoint.
Per CVL Economics and DEO’s study, 17% of Paramount’s total workforce and 13% of WBD’s total workforce are located in L.A. County. When looking by unit, 35% of Paramount and 27% of WBD’s studios unit workforces are based in L.A., while direct-to-consumer/streaming make up 15% and 17% and TV/media and global linear networks make up 10% and 2%, respectively.
In addition to Bass, Xavier Becerra, the Democratic nominee in California’s gubernatorial race, has called for a settlement. The Wall Street Journal reported that California Gov. Gavin Newsom has also privately urged Bonta to reach a settlement.
The Directors’ Guild of America and IATSE have also presented a settlement proposal that would include conditions such as keeping operation of Paramount and WBD’s film and TV studios and their production, distribution, marketing and exhibition groups separate; keeping HBO available on third-party platforms; and commitments around content licensing, theatrical releases, U.S.-based productions and remaining based in Los Angeles.
Others who have come out in support of the merger include the CEOs of AMC Theaters, Regal and Cinemark, as well as Lionsgate CEO Jon Feltheimer. Trade organization Cinema United has also called for settlement after previously opposing the merger.
In addition to Bonta and 11 other state attorneys general, the Paramount-WBD merger faces lawsuits from the Writers’ Guild of America and a Paramount shareholder. A group of consumers also filed a lawsuit seeking to block the merger, but it was dismissed.
In a statement, the WGA said it was “disappointed” that Bass has “chosen to join Paramount’s pressure campaign on public enforcers, to push through a merger that is being rightfully challenged as illegal and will lead to job losses in the entertainment industry.”
“Industry workers deserve a mayor who believes in upholding the law and protecting the working people of Los Angeles, not serving the interests of powerful corporations,” the union continued. “Paramount has created a false choice for entertainment industry workers: The company argues that enforcing antitrust law hurts us by creating uncertainty, which is of their own making as the company attempts to dominate the industry. We reject the claim that beleaguered industry workers must choose the possibility of a job today, in exchange for the certainty of job losses tomorrow.”
A spokesperson for Bonta’s office did not immediately return TheWrap’s request for comment.
