A federal judge halts the $110bn Paramount and Warner Bros. merger for 14 days

A federal judge has halted the largest media merger in Hollywood history. The U.S. District Court for the Northern District of California granted a temporary restraining order on July 20 that bars Paramount Skydance from closing its $110bn acquisition of Warner Bros. Discovery, according to the office of California Attorney General Rob Bonta, which published the court's statement. The order came at the request of a coalition of 12 state attorneys general. It runs for 14 days.

Reported by Daniel Arkin at NBC News, the order from Judge Araceli Martinez-Olguin keeps the deal frozen while the court weighs a longer preliminary injunction, and a hearing on that motion is set for August 3. The states sued on July 13, alleging in their complaint that the merger would violate Section 7 of the Clayton Act, the 1914 law that bars deals likely to substantially lessen competition. They point to three markets: the distribution of wide-release films, the distribution of anticipated blockbusters, and the licensing of cable channels to television distributors. Paramount had already cleared the U.S. Justice Department.

Paramount has pushed back hard. A company spokesperson called the state case one of the "weakest merger challenges in modern antitrust history" and said the alleged markets have no basis in modern market realities, according to NBC News. The clock is the other pressure. If the transaction does not close by September 30, Paramount must pay Warner Bros. shareholders a fee of 25 cents a share every quarter, which NBC News reported works out to more than $600m a quarter.