Paramount and Warner Bros.’ mega-merger has hit the brakes after a judge issued an order on the multibillion-dollar deal over antitrust concerns.
According to NBC, U.S. District Judge Araceli Martinez-Olguin penned a restraining, though temporary, order after California led a coalition of 12 states against the merger, claiming the deal would hurt the industry by squeezing competition and raising prices.
In the ruling, the judge wrote, “Plaintiff States’ showing at least demonstrates that serious questions going to the merits remain, weighing in favor of preliminary injunctive relief.”
Paramount, meanwhile, has agreed not to end the transaction before July 22 and also assured the delay until the end of September would not cost them much because the network is forced to pay millions of dollars each day, per the agreement with WB investors, if the deal did not complete by Sept. 30.
“Paramount and Warner Bros. will continue to operate as separate, viable companies competing in the marketplace while they wait for the Court to adjudicate this case,” the court’s decision read.
“The balance of equities, combined with the public’s vital interest in antitrust enforcement, therefore tips sharply in favor of the requested injunctive relief.”
Meanwhile, the ruling threw a major wrench into Paramount and Warner Bros. mega-deal because, according to Variety, antitrust injunctions can break mergers.
