Los Angeles County Supervisor Lindsey Horvath introduced a motion Tuesday calling for the county to support a lawsuit filed by California and 11 other states looking to block the proposed takeover of Warner Bros. Discovery by Paramount Skydance.
“For too long, working people have borne the cost of corporate consolidation, while jobs disappear and production leaves our region,” Horvath said in a statement. “Our economic analysis shows this merger could put thousands of local jobs at risk. As the global capital of the creative economy, Los Angeles County has a responsibility to help make the case against this merger by providing the facts, supporting Attorney General (Rob) Bonta’s litigation, and standing up for the workers, small businesses, and communities that depend on this industry.”
The Board of Supervisors is expected to vote on Horvath’s motion next week. The motion calls for the county to support the lawsuit filed Monday in Northern California, possibly through the provision of legal support or the filing of an amicus brief in court.
Earlier this year, at the direction of the Board of Supervisors, the county Department of Economic Opportunity prepared a report on possibly impacts of the proposed merger. That report estimated that the move could lead to nearly 2,500 job losses in the county, and about 6,000 globally.
The jobs at risk would mainly be in corporate, tech, real estate and other shared functions due to duplicative roles across the two companies, according to the report. The department noted in the report that its job-loss estimates should not be read as a layoff forecast, saying the document only defines the scale of possible employment impacts that may be subject to consolidation.
In announcing the lawsuit Monday, Bonta argued that the merger, which has already been approved byt he U.S. Department of Justice, would led to higher prices for consumers and a reduction in entertainment content.
Bonta said the $110 billion merger — considered one of the biggest media deals in history — would put one company in charge of nearly one-third of all theatrical motion picture and basic cable programming.
Other states joining the lawsuit were Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington.
Paramount Skydance issued a statement Monday saying the lawsuit “reflects a fundamentally flawed application of the antitrust laws and is wrong on both the facts and the law.”
“We will vigorously defend the transaction and demonstrate that this challenge is inconsistent with sound competition policy and the competitive realities of the media marketplace,” according to the company. “Delaying this transaction will only harm entertainment workers who have already suffered over recent years as technology has disrupted their livelihood and cost California tens of thousands of entertainment jobs.
“The combination of Paramount and WBD will create a stronger, well-capitalized, creative-first media company that is better positioned to compete with companies like Netflix that have come to dominate the industry for audiences, premium content, and creative talent. Put simply, any attempt to block this transaction undermines the very principles antitrust law is designed to promote: more competition, more choice for consumers, and more opportunities for creators and workers.”
The estimated $110 billion transaction would combine Paramount Pictures and Warner Bros., studios whose histories span more than a century. The combined company would also include the Paramount+ and HBO Max streaming services, the CBS broadcast network and cable channels including CNN.
David Ellison, CEO of Paramount Skydance, has previously said the merger would honor the legacy of both companies while creating a next-generation media and entertainment business. Ellison is the son of billionaire Oracle co-founder Larry Ellison.
If the deal closes, David Ellison would control CBS News and CNN, Paramount Pictures and Warner Bros., and subscription streaming services Paramount+ and HBO Max.
The deal has faced opposition from some entertainment industry professionals and elected officials who argue it would further consolidate ownership in the media industry.
More than 1,000 entertainment professionals signed an open letter in April opposing the merger, contending it would reduce competition at a time when the industry is already highly concentrated.