A US federal judge has issued a 14-day block on the proposed $110 billion merger between Paramount Skydance and Warner Bros Discovery, halting one of the largest deals in media history before it can be finalised. US District Judge Araceli Martínez-Olguín issued the temporary restraining order on Monday following legal arguments heard last week, ruling that the merger cannot be completed or operationally integrated while the courts consider the case.
The block comes after a coalition of 12 US states, led by California and including New York, filed a lawsuit seeking to stop the deal on antitrust grounds. The states argue that combining two of Hollywood's most powerful studios would give the merged entity outsized control over film distribution, reduce choice for cinema-goers and streaming audiences, and ultimately drive up consumer prices. In her ruling, Judge Martínez-Olguín found that the states had raised "serious questions" about the deal's impact on movie distribution and concluded that the public's "vital interest in antitrust enforcement" outweighed any inconvenience caused by a temporary delay.
The judge also cited practical concerns: if the companies were allowed to proceed immediately — cutting jobs, sharing sensitive internal data, and integrating operations — reversing those steps later would be, in her words, "extraordinarily difficult to unscramble the egg." Both companies had declined to voluntarily delay the closing of the deal, prompting the court-ordered pause.
The merger, announced in late February, would bring together two of the world's largest entertainment empires. Warner Bros Discovery owns the HBO Max streaming platform, film studio Warner Bros — behind franchises such as Harry Potter, The Lord of the Rings and The Matrix — as well as television channels including CNN, Discovery Channel, and Eurosport. Paramount's portfolio includes CBS, MTV, Nickelodeon, Comedy Central, and films such as The Godfather, Top Gun, and Titanic. Paramount CEO David Ellison, whose family is backed by software billionaire Larry Ellison, has framed the deal as a bid to create a streaming giant capable of competing with Netflix and Disney. The US Department of Justice had previously cleared the merger without conditions.
On 3 August, the court will decide whether the block should be extended for the duration of the full legal proceedings — a ruling that could delay the deal by several months. Paramount has a strong commercial incentive to close before 30 September: under the terms of its agreement, missing that deadline triggers a penalty of roughly $0.25 per share per day — approximately $7 million daily — payable to Warner Bros Discovery shareholders. Paramount called the lawsuit a "distortion of competition law" and said it was confident the evidence would show the states' arguments were unfounded, insisting the combined company would produce more films and benefit workers across the entertainment industry.