Paramount CEO David Ellison is threatening to begin moving the studio out of California on October 1 if state Attorney General Rob Bonta refuses to enter settlement talks over the proposed Paramount-Warner Bros. Discovery merger. The company would reportedly move its Los Angeles headquarters first and shift most studio jobs out of the state over five years, with Georgia, Texas, and Tennessee under consideration. Variety reports: Ellison's threat to relocate Paramount in retaliation for California's Bonta leading the charge to kill the WBD deal -- a move that would include much of its studio operations, over time -- was first reported by industry newsletter Puck. In response, Bonta called Ellison's planned exit from the state an "attempt to blackmail the state into letting an illegal deal through."
"Paramount has lost the plot as it continues to lose in court," the attorney general wrote in a post on X. "It didn't work the first time -- on the eve of our July lawsuit -- and it won't work this time." Bonta has not publicly said what concessions from Paramount-WBD he would consider acceptable enough to take the lawsuit off the table. But the Democratic attorney general has said any remedies would need to be "structural" (i.e., divestments) rather than "behavioral" (e.g., imposing certain production quotas).
Oct. 1 is when Paramount will begin accruing a "ticking fee" payable to Warner Bros. Discovery shareholders of $7 million per day. The trial in the state AGs' lawsuit is scheduled to start March 2, 2027, roughly five months after that, so Paramount would be on the hook to pay around $1.2 billion to WBD shareholders by the time the trial is scheduled to conclude. (Paramount's ticking-fee payments to WBD are not due until the deal closes.) At the Aug. 5 meeting on Paramount's lot, Ellison told his 12-member senior executive team he expects Paramount to prevail in the antitrust case against the states. However, he also said that if Bonta balks at talks, Paramount will start packing up and moving out of the Golden State in less than two months.
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