Court sets hearing date for Paramount and Warner merger for March 2, 2027

The U.S. judicial system has set the start date for the proceedings regarding the merger of Paramount and Warner for March 2, 2027. This court hearing will determine whether the acquisition of Warner Bros. Discovery by Paramount, valued at $111 billion (570.9 billion Brazilian reais), violates the country's antitrust laws. The decision could further delay the completion of one of the largest mergers in the history of the entertainment industry.

Judge Araceli Martínez-Olguín of the U.S. District Court for the Northern District of California ruled that the hearing will last 12 days, with scheduled breaks throughout March.

States seek to postpone hearings

The new schedule is a victory for a coalition of 12 U.S. states that filed suit to block the deal. Last week, state attorneys general demanded that the hearings begin in April 2027. In turn, Paramount argued that the case should be heard as early as November of this year, characterizing the states' demand as a deliberate attempt to drag out the process.

The company stated in an official filing that it respects the Court's decision. Meanwhile, the office of Rob Bonta, California's Attorney General and one of the leaders of the lawsuit, expressed satisfaction with the 'attention the case is receiving from the court.'

The delay also increases financial costs for Paramount. Under the agreement terms, the company is obligated to pay Warner Bros. Discovery shareholders $650 million (3.3 billion Brazilian reais) for each quarter of delay in closing the merger, starting in October. Furthermore, Paramount agreed not to complete the acquisition until a court ruling is obtained and set June 2027 as the deadline for finalizing the transaction.

In a letter to investors, David Ellison, Paramount's controller, reported that the company continues to implement its plans while awaiting the completion of the purchase. He stated that the company expects to generate $3.9 billion (20 billion Brazilian reais) in net profit this year, aided by a large-scale cost-cutting program.

If the deal is approved, it will unite two of Hollywood's largest studios, along with streaming services HBO Max and Paramount+, and channels such as CBS and CNN. Paramount argues that the merger is necessary to strengthen its position against competition from streaming giants like Netflix and Amazon. In an article published in The New York Times, David Ellison noted that lawsuits against the deal 'imagine a Hollywood that no longer exists.'

States and union challenge the agreement

The state attorneys general who initiated the lawsuit insist that the merger will give Paramount a dominant position in various market segments, including the production of major blockbusters and cable television channels. In addition to the state lawsuit, the Writers Guild of America, a union representing screenwriters in the United States, has also joined the court, stating that the deal could harm industry workers.