Settlement talks between California Attorney General Rob Bonta’s coalition and Paramount over its $111 billion merger with Warner Bros Discovery collapsed before they began, with Bonta cancelling the scheduled Monday meeting in the midnight hour after accusing the David Ellison-led company of leaking — and misrepresenting — the substance of a private preliminary discussion held August 21st.
“Not only did Paramount leak the alleged substance of settlement discussions, but they misrepresented these discussions, demonstrating a lack of good faith,” Bonta said in a statement provided in the early hours of Monday morning. “As soon as Paramount stops playing games and engages sincerely, my office is happy to meet again.”
The existence of behind-the-scenes talks had itself become public in an unusual way — through California Governor Gavin Newsom, who confirmed on August 21st that conversations were ongoing. “I know there are many meetings that are going on, and there’s a lot of conversation,” Newsom said. The preliminary August 21st gathering had been intended to set the agenda for the Monday meeting. Expectations for that meeting had been described by sources as “intentionally low.” Paramount did not respond to requests for comment.
What the AGs Were Asking — and Why Ellison Said No
The twelve state attorneys general who filed an antitrust lawsuit against Paramount and Warner Bros Discovery on July 13th had arrived at the table with a set of demands that studio insiders described as non-starters. The coalition wanted Ellison to sell a significant portion of WBD’s cable channel portfolio. It also sought to keep Paramount and Warner Bros operating as two separate studios. And it wanted Ellison — a close ally of President Trump, with backing from his father Larry Ellison — effectively cordoned off from operational control of the combined company.
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“David’s not going to go along with any of that, and Bonta knows it,” one studio executive told source. The wide gap between what the AGs were willing to accept and what Ellison was prepared to offer underscores why the lawsuit itself remains on a path to trial, set for March 2nd, 2027 before federal Judge Araceli Martinez-Olguin.
The dispute has taken on a political dimension well beyond antitrust law. Ellison’s threat to relocate Paramount Skydance operations to Georgia, Texas, or Tennessee if the merger doesn’t see progress by October 1st drew a furious response from Bonta, who publicly branded the move “blackmail.” Ellison’s decision to write op-eds arguing the case is fundamentally about CNN’s editorial independence rather than competition law has further inflamed the already bitter dynamic.
What Is at Stake in Los Angeles
The human and economic consequences of the merger’s uncertainty are substantial. A report submitted to the Los Angeles County Board of Supervisors on August 19th estimated approximately 4,500 television and film jobs could be lost as a direct result of the merged company’s more than $80 billion debt burden. The LA County Department of Economic Opportunity also projects thousands of additional indirect job losses, with the region standing to lose $547 million in tax revenue and billions in wages.
The lawsuit has drawn political pressure from multiple directions. Newsom, LA Mayor Karen Bass, the Directors Guild of America, IATSE, and Democratic gubernatorial candidate Xavier Becerra have all publicly urged both sides to reach a settlement. The Writers Guild is also aligned with the AG coalition in the lawsuit. No further settlement meetings have been scheduled.
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