Paramount Slapped With Consumer Lawsuit Over Warner Bros. Deal — Report

Paramount and Warner Bros. Discovery are facing a lawsuit by consumers seeking to block the merger deal. This comes after the Warner Bros. shareholders agreed to the $110 billion merger between the two giants. Although they approved the deal, the shareholders didn’t agree to the huge payout proposed for CEO David Zaslav.

Lawsuit filed against Paramount over Warner Bros. merger

A lawsuit has been filed against Paramount and Warner Bros. Discovery to block their merger.

According to a report by The Hollywood Reporter, a few Paramount+ subscribers have taken legal action. They claim that the deal will lead to fewer viewing options and reduce competition in theatrical distribution. Moreover, the subscribers alleged that the merger might lead to price increases.

The complaint asserted that the deal will strengthen “Paramount’s ability and incentive to raise prices, reduce output, narrow slates, reduce quality, and worsen consumer-facing terms, including through control of distribution, exclusivity, windowing, and licensing.”

The report further reveals that Paramount has responded to the lawsuit in a statement and said it is “without merit.” They opposed the consumers’ claims and added, “The combination of Paramount and WBD will create a stronger competitor that is well positioned to serve as a champion for creative talent and consumer choice.”

Previously, commenting on the merger, Paramount CEO David Ellison said at CinemaCon, “I want to look every single one of you in the eye and promise once we combine with Warner Bros., we are going to make a minimum 30 movies a year. Every film will be released in theaters with minimum 45-day window and SVOD in 90 days.”

After Warner Bros. Discovery shareholders recently agreed to the Paramount merger at $31 per share in cash, Ellison added, “Today’s stockholder approval is another key milestone toward completing this historic transaction that will deliver exceptional value to our stockholders” (via NBC News).

However, it is to be noted that California state attorneys general is still investigating the merger. Thus, any negative report could potentially aid the said lawsuit to block it.

Source: Comingsoon.net