Paramount Skydance ripped into Netflix in a letter sent to the U.S. Department of Justice, accusing the streamer of launching a “scorched-earth campaign” against them.
In the note sent to Jared A. Hughes and A. Maya Khan on Friday, Makan Delrahim, Paramount’s chief legal officer, slammed its once rival for Warner Bros. Discovery for attempting to “poison regulators and other stakeholders against” the now $110 billion deal. Specifically, the note claimed Netflix’s “panic-level response” showed how seriously the streamer took David Ellison’s company as “a scaled competitor.”
Paramount’s letter was in response to a March report filed by the International Brotherhood of Teamsters, in which the union argued to the DOJ that Ellison’s company posed “a direct threat to film and television workers nationwide.”
While the Teamsters encouraged the DOJ to block the WarnerMount deal unless “substantial and enforceable safeguards are put in place to increase domestic production and protect jobs,” Paramount once again defended that the merger was set to create more work for Hollywood.
“Organized labor will directly benefit from the new competitive energy and increased content investment that the combined firm will bring to the entertainment industry,” the letter argued. “The Transaction’s positive impacts on organized labor flow naturally from the business logic that drives the underlying deal. Paramount wants to combine with WBD to create a stronger, more efficient competitor that will operate at scale and take on Netflix and the other streaming giants.”
Delrahim added: “The Transaction presumably will spur other production opportunities, as well. As Paramount pushes forward with its ‘content-first’ growth strategy, firms like Netflix, Amazon MGM, Disney, Universal, Sony, Lionsgate, A24, Apple, and many others will need to respond in kind, presumably by enhancing their own content creation strategies.”
Representatives for Netflix and the Teamsters did not immediately respond to TheWrap’s request for comment.
This is just one of several hurdles Paramount is facing as it looks to close its merger with Warner Bros. As we reported on Friday, a group of state attorneys general are reportedly preparing to move forward with a lawsuit to block the $110 billion deal as soon as this month.
California Attorney General Rob Bonta, who is investigating the deal, previously told TheWrap that “red flags are everywhere when you have a merger of this type” and that the states are prepared to “act timely,” but declined to provide a specific timeline at the time. Though, a spokesperson for Bonta told TheWrap on Friday that they continue to actively investigate the Paramount-WBD merger – but declined to comment further.
