California Gov. Gavin Newsom defended himself on Wednesday morning, insisting he did not pressure state Attorney General Rob Bonta into settling with Paramount over its $110 billion Warner Bros. Discovery merger.
“I didn’t pressure anybody,” he told Axios. “I made the point, I’ve made it very publicly and consistently, and it’s been reported maybe two or three hundred different ways that we — me, many folks, including the mayor, soon-to-be governor-elect Becerra and others — preferred, in the words of Rob Bonta himself, that he focus on getting this done at the boardroom, not the courtroom.”
“The minute that Rob said that on CNBC, we amplified that, said this was a better approach,” Newsom added. “So that was the framework, and he worked hard to deliver for California and I think he did.”
On Monday, Bonta and his fellow 11 state AGs settled their lawsuit against Paramount ahead of a 2027 trial and its accompanying ticking fees, clearing the way for the merger to close within the next two weeks. In turn, CEO David Ellison assured California officials that studio headquarters will not be leaving the state.
All parties will now reconvene on Thursday to hammer out details of the settlement, U.S. District Judge Araceli Martínez-Olguín ruled on Tuesday. She has not yet accepted their agreed terms, but she did scrap the company’s $1.88 billion bond request hearing.
Said agreement includes a minimum investment of at least $300 million annually in domestic TV and film production, or $1.5 billion over five years. Paramount has agreed to produce 30 films per year in the first two years of the deal, which will be upped to 32 per year in each of the following three years, with at least four films per year independent and at least 20% blockbuster (if Congress passes a federal film tax credit, Paramount agreed that 20% of all film production must be in the U.S. for the first two years of the merger and 30% of the next three).
Additionally, the combined company must also establish an editorial board to monitor CNN and CBS News’ independence, continue negotiating their cable packages separately for five years to preserve competition, maintain both studio lots and implement a $47.5 million employee merger impact fund, amongst other compromises.
Some people following the case have accused Bonta of caving to billionaire Ellison without many restrictions, after the state AG spent weeks saying he was not looking for a remedy but rather an end to the merger.
“Let me be clear: This settlement is not a vote of support for this merger. But we believe this settlement, which resolves our antitrust concerns in every market alleged in our case, protects competition and consumer choice, and puts workers’ needs, concerns, and futures first, is the best course of action,” Bonta said in a Monday statement. “There’s no Hollywood without the people who work on and off screen to make the magic happen, and today’s settlement protects workers, jobs and Hollywood.”
