The mega merger between Paramount and Warner Bros still has some hurdles to overcome | Paramount Pictures

Champagne was reportedly flowing at Paramount Skydance headquarters late last week after the media conglomerate beat out Netflix to acquire all of Warner Bros Discovery for $110 billion.

In a call with analysts and investors Monday morning, Paramount Skydance CEO David Ellison said the company was “very confident” that the merger would quickly pass regulatory muster both in the U.S. and abroad.

“We have dealt with regulatory agencies around the world and this combination has not come close to hitting any of the metrics that could cause a problem,” Ellison said.

But the deal, which has drawn angry comments from several Democratic members of the US Senate, does not necessarily have an easy path to closure, antitrust and competition experts say. While Congress has no power to stop the merger, a state attorney general — or a coalition of attorneys general — could file a lawsuit to block the deal, which could put the matter before a judge.

“I certainly think they have a chance to stop this if they pool their resources to meet the challenge,” Alvaro Bedoya, who served on the FTC between 2022 and 2025, said in an interview.

In this context, California Attorney General Rob Bonta said in a post on X that he is “having a conversation” with his fellow state prosecutors.

“Paramount/Warner Bros. is not a done deal,” Bonta said in a statement after the deal was announced. “These two Hollywood giants have not passed regulatory scrutiny – the California Department of Justice has an open investigation, and we intend to be active in our review.” (Bonta, who was not available for an interview, provided no further comment.)

“The joint lawsuit brought by state attorneys general represents a real threat,” Bill Baer, ​​who served as assistant attorney general in charge of the US Department of Justice’s antitrust division from 2013 to 2016, told the Guardian. “It is difficult for them to win then [the justice department] He said [the merger] Good, but not impossible. There are serious antitrust issues that in a normal world would require further investigation.

The merger would also need approval from antitrust officials from the European Commission and the United Kingdom — although competition and antitrust expert Cristina Cavarra said she didn’t expect that to be a problem, especially because she doesn’t see much willingness to antagonize Donald Trump, a staunch supporter of the Ellison family and its deal.

“This deal is not of particular interest to anyone in Europe,” she said. “There is no potential for job losses, as there is in California. Even on traditional grounds, this is likely to be waved away in Europe. They care less in a Trump administration where the outcome is predicted.”

As for the process in the UK, Cavarra claimed that “the country’s competition authority has been beheaded” – and is more focused on promoting growth than regulating competition.

By combining streaming services HBO Max and Paramount+, Ellison announced Monday, the deal could plausibly be viewed as reducing competition in the market — though the company said it would “preserve” the Warner Bros. and Paramount film studios.

“I think there’s an argument that this will create a very concentrated market for a very specific type of movie studio that makes a very specific type of movie,” said Bedoya, the former FTC commissioner. “There seems to be a more pressing case that a significant number of people are going to be thrown out of their jobs. So I think a state attorney general who is looking at labor market impacts will have something to work with.”

The combined company will also be saddled with $79 billion in debt, and is certain to undertake major cost-cutting efforts that are expected to include layoffs. The Writers Guild of America issued a statement last week opposing the deal, saying the merger “should be blocked” because “the loss of competition would be disastrous for writers, consumers, and the entire entertainment industry.”

Some US senators made similar arguments. “If the Paramount Skydance deal with Warner Bros. goes through, one family will become a dominant force in American entertainment, where David Ellison owns Warner Bros., Paramount+, HBO, CBS News, CNN, TNT, TBS, Food Network, Discovery Channel, Animal Planet, HGTV and others,” U.S. Senators Elizabeth Warren and Richard Blumenthal wrote in a letter to Pam Bondi, the U.S. Attorney General, on Monday. “Federal antitrust law is designed to prevent mergers that would create huge conglomerates like this, which are harmful to our economy and to Americans.”

A Justice Department spokesperson declined to comment on the status of the agency’s regulatory process, though Bloomberg News reported that the deal “remains under active review by U.S. antitrust officials.”

“We will work incredibly collaboratively with regulators to ensure we have a fast path to closure and we are confident we can achieve that goal,” Ellison said on Monday.

Although it was not the lead bidder, as Warner Bros Discovery’s board of directors initially backed Netflix’s bid, Paramount has already completed at least two requests for information from the Department of Justice. Because the 10-day waiting period imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976 expired on February 19, Paramount said last month that “there is no legal impediment in the United States to closing Paramount’s proposed acquisition of WBD.”

While Baer said it appears the Trump-era Justice Department was leaning toward approving the deal, and the process certainly takes a few steps already, “they have gained the authority to issue civil investigative demands and request more information from both parties” now that the deal has been finalized.

“I think there is a big risk in delaying the closing of the deal,” he added.