Paramount pauses $110bn Warner Bros deal after judge’s restraining order

KUALA LUMPUR, 25 JULY 2026 —

Paramount Skydance has agreed to halt its $110 billion acquisition of Warner Bros Discovery while a federal judge rules on a lawsuit filed by 12 states alleging the merger would stifle competition.

The pause, filed in court on Friday, could cost the combined entity about $7 million a day in fees it promised to Warner Bros shareholders if the deal does not close by September 30.

Paramount’s spokesperson said the group would defend the merger at trial, calling the states’ claims “meritless.”

Twelve states, led by California, sued on July 13, arguing the deal would “extinguish competition” in Hollywood and limit consumer choice for moviegoers and cable subscribers. New York Attorney General Letitia James said halting the merger was “a critical victory” to protect the film and television industries.

The filing comes days after US District Judge Araceli Martinez-Olguin granted a temporary restraining order freezing the transaction for several weeks.

Paramount and Warner Bros agreed to pause the deal until five days after the judge rules on the merits of the case, or June 1, 2027, whichever comes first. If delayed until then, Paramount could owe Warner Bros shareholders up to $1.7 billion in ticking fees.

Similar merger challenges have taken an average of eight months for a judge to rule, according to a Reuters review of recent cases.

The pause follows concerns over media consolidation, as the merger would have placed CNN—currently owned by Warner Bros—under Paramount’s control. Paramount already owns CBS, which has faced internal turmoil over allegations of bias in favor of US President Donald Trump under CEO David Ellison. His father, tech billionaire Larry Ellison, is a Trump ally.

For Malaysian investors, the delay underscores the regulatory risks facing cross-border media mergers, particularly where antitrust concerns intersect with geopolitical sensitivities.