Paramount Merger Update: Legal Challenges Ahead

The wait for confirmation on AEW’s long-term broadcast home will continue a little longer.

A California judge granted a temporary restraining order on Monday in response to a lawsuit filed last week by a coalition of U.S. state attorneys general challenging the proposed merger between Paramount and Warner Bros. Discovery. The ruling pauses the transaction for at least 14 days while the legal challenge moves forward.

The coalition, which includes attorneys general from Nevada, Massachusetts, New York, New Jersey, and several other states, argues the merger would violate a century-old antitrust law by creating an anticompetitive market. While Warner Bros. Discovery declined to comment publicly, Paramount defended the transaction, stating that the “merger is lawful, pro-competitive, and will benefit consumers, creators, workers, and the entertainment industry.”

According to court proceedings, a Paramount attorney said the request for the temporary restraining order came after the company indicated the deal could close as early as this Wednesday. Additional restraining orders or injunctions could still be sought as the case continues.

CNBC also noted that this is not the only major media merger facing legal delays. The proposed $6.2 billion merger between Nexstar Media and Tegna is currently on hold following a similar lawsuit and injunction filed by California Attorney General Rob Bonta. That case is not expected to go to trial until mid-2027.

The merger agreement also contains significant financial provisions. If the deal is not finalized by the end of September, Warner Bros. Discovery shareholders will receive an additional 25 cents per share each quarter until the transaction closes, amounting to roughly $650 million per quarter. If regulators ultimately block the merger, Paramount would be required to pay Warner Bros. Discovery a $7 billion termination fee under the terms of the agreement.

While the legal battle continues, the situation remains notable for AEW. The promotion’s current media rights agreement with Warner Bros. Discovery runs through 2027 and includes a one-year extension option controlled by WBD. AEW President Tony Khan has also spoken positively in recent months about Paramount Skydance CEO David Ellison and the company’s potential future relationship with Paramount should the merger ultimately be completed.