By Dawn Chmielewski
LOS ANGELES, Aug 31 (Reuters) – The State of California and 11 other states joined the Writers Guild of America on Monday in urging a federal court judge to deny Paramount Skydance’s request for a $1.88 billion bond to address the cost of delay in completing its acquisition of Warner Bros Discovery.
California argued that any damages Paramount has incurred from delays in closing the Warner Bros deal are self-imposed, a court filing on Monday showed. The state argued the studio willingly offered to pay Warner Bros shareholders a daily “ticking fee” for any delays in the merger as part of its effort to secure the deal.
Paramount also voluntarily agreed to refrain from closing the merger until the antitrust case is resolved, or June 1, 2027, whichever comes first.
“Paramount now wishes to offload its responsibility,” California Attorney General Rob Bonta argued in the court filing, saying Paramount’s request for a bond should be denied.
The company must pay a fee of $7 million a day if the $110 billion merger does not close by September 30. Paramount noted the trial on the states’ legal challenge is scheduled for March and by the time it concludes and final legal briefs are submitted in April, it will have paid Warner Bros shareholders an unrecoverable $1.3 billion.
