Paramount demands $1.88 billion bond from 12 states in Warner Bros. merger lawsuit

Legal motion and bond demand

Paramount Skydance filed a court motion on Monday demanding a $1.88 billion bond from 12 US states and the Writers Guild of America. The media company, led by chief executive David Ellison and legal affairs chief Makan Delrahim, filed the request in the U.S. District Court for the Northern District of California. Paramount asked Judge Araceli Martínez-Olguín to require the plaintiffs to post exactly $1,884,726,092.73 by September 30, 2026. If the plaintiffs fail to post the bond, the motion requests the dissolution of the court order that prevents the $111 billion merger with Warner Bros. Discovery from closing. Paramount argued that the bond is required under federal statutes to protect defendants against financial damage when a transaction is halted during litigation.

Both the Clayton Act, the federal antitrust law upon which these suits are based, and other federal law expressly provide that plaintiffs are required to post a bond covering the potential harm from halting a transaction to litigate, so that if they lose, the injured party has a source of recovery for the damage caused.

Ticking fees and financial costs

The requested bond amount reflects contractual penalties and financing obligations triggered by the delay. Paramount agreed to pay Warner Bros. Discovery shareholders a ticking fee of $650 million per quarter, representing roughly $7 million per day, starting on October 1, 2026, if the merger has not closed. With the antitrust trial scheduled to begin in March 2027, those penalty payments are projected to reach between $1.2 billion and $1.3 billion. Company leadership had initially expected the acquisition to close by the third quarter of 2026 before the lawsuits intervened. Paramount maintained that an eight-month closing delay freezes commercial operations and leaves employees at both studios facing prolonged workplace uncertainty.

By virtue of what will be at least an eight-month delay in closing, there will be no integration and no ramped-up investment in content, production, and creative talent by the combined company.

Antitrust claims and corporate defense

The litigation began in July 2026 when 12 state attorneys general, led by California Attorney General Rob Bonta, filed an antitrust suit to block the deal. The states argue that combining the two companies would create outsize market power, reducing competition in theatrical film distribution and basic cable television. A separate lawsuit from the Writers Guild of America asserts that the deal would depress the marketplace by reducing the number of buyers for scripts and creative work. The proposed transaction would unite two film studios, multiple streaming platforms, and television news operations CNN and CBS News. Paramount argued that the consolidation is required to achieve scale against technology firms like Netflix, noting that the merger has received regulatory approvals in 68 other jurisdictions.

Judicial history and trial schedule

The lawsuits represent the final regulatory obstacle to completing the $111 billion takeover. Judge Martínez-Olguín previously granted a 28-day temporary restraining order halting the deal, while waiving the customary bond requirement because the states were suing in the public interest. Paramount is seeking to modify that order prior to the start of contractual ticking fees in October. The motion would make state taxpayers liable for the bond should the plaintiffs lose the case at trial. The federal court in Oakland has scheduled the full antitrust trial to begin on March 2, 2027.