A federal judge approved a settlement allowing Paramount's Warner Bros. Discovery acquisition to proceed.
Why it matters: The combination would unite major film, television, streaming and news assets, reshaping competition across Hollywood and U.S. media. The settlement also creates conditions for theatrical output, production spending and editorial independence.
- Judge Araceli Martínez-Olguín entered the consent decree on September 30, 2026.
- The combined company must release at least 30 films annually for two years, then 32 annually for three years.
- Paramount and WBD must add at least $300 million annually to U.S. production spending for five years.
- A five-member News Editorial Independence Board must be established within 180 days after closing.
U.S. District Judge Araceli Martínez-Olguín entered a consent decree resolving the antitrust lawsuit brought by California and 11 other states against Paramount Skydance's proposed acquisition of Warner Bros. Discovery. The order modified the no-close restriction, allowing the companies to complete the merger subject to remaining transaction conditions. The court record says the settlement was a fair, reasonable and good-faith response to the competitive harms alleged in the complaint.
The agreement relies mainly on behavioral and investment commitments. The combined company must release at least 30 films annually in each of the first two years and 32 annually in each of the following three years, including minimum wide-release and independent-film requirements. It must also spend at least $300 million more per year on U.S. production than Paramount and WBD's combined 2025 baseline, or $1.5 billion over five years. The Paramount SEC filing details theatrical windows, marketing and budget requirements.
The settlement bars the companies from selling or closing the Paramount and Warner Bros. studio lots during the five-year commitment period. It also requires a five-member News Editorial Independence Board within 180 days after closing to set principles and resolve specified disputes involving CBS News and CNN.
Enforcement remedies include potential divestiture of Miramax Studios if film commitments are missed, plus a $30 million payment for each shortfall. An uncured material breach involving cable-channel affiliation agreements could trigger divestitures of BET, VH1, Comedy Central, Smithsonian, Destination America and Science.
The Justice Department closed its federal investigation in June, saying the deal was not likely to harm competition in theatrical film development, production or distribution. California Attorney General Rob Bonta said the settlement was not a vote of support for the merger.
By the numbers
- 5 years - Principal settlement commitment period
- $300 million - Minimum annual increase in U.S. production spending
- 30 films - Annual theatrical-release minimum in each of the first two years
Yes, but: The order clears the no-close barrier but does not itself close the transaction. The settlement resolves the states' claims without admitting antitrust violations, and the effectiveness of the editorial-independence mechanism remains uncertain.
What's next: The companies must satisfy customary closing conditions, financing and integration requirements. No final closing date has been established in the public materials.