The temporary restraining order, granted by California District Judge Araceli Martínez-Olguín, pauses the merger for 14 days following a lawsuit led by California Attorney General Rob Bonta.
The lawsuit argues that the merger could violate antitrust laws by potentially controlling nearly one-third of films and basic cable programming, which Bonta claims would result in higher prices and lower quality content for consumers. Paramount's legal team contends that the merger is pro-competitive and would enhance content quality and production investment.
The deal has already received clearance from the U.S. Department of Justice and several global jurisdictions, with a target closing date of September 30. However, if the merger is delayed beyond this date, Paramount could incur significant costs, including a ticking fee of $650 million per quarter and a $7 billion breakup fee if regulatory issues prevent the deal from closing.
The outcome of this legal challenge could have broader implications for the media sector, particularly as it follows a similar lawsuit affecting another media merger involving Nexstar Media Group and Tegna