Top DOJ Officials Cleared Paramount-Warner Bros. Merger Before Staff Lawyers, Who Were 'Leaning' Toward Antitrust Lawsuit, Could Object

Senior officials at the Justice Department moved to close out the antitrust investigation into Paramount's $111 billion takeover of Warner Bros. Discovery before the team of lawyers investigating the matter could issue a recommendation, according to a Wall Street Journal report. The career lawyers in the DOJ's Antitrust Division had been "leaning" toward advising that the department should file a lawsuit seeking to block the merger — and were surprised when DOJ leadership gave the deal the green light, per the Journal article. "The American people need to know if this merger was approved as a political favor. This reeks of corruption," Sen. Elizabeth Warren (D-Mass.), who has been a strong critic of the Paramount-WBD deal, wrote in a post on Bluesky, citing the WSJ story. In March, the acting head of the Justice Department's antitrust division, Omeed Assefi, said the Paramount-WBD deal would "absolutely not" be on a fast-track for approval due to political reasons, in the context of the Ellison family's friendly ties to Trump. The Journal story, citing anonymous sources, said DOJ attorneys who had spent months investigating Paramount-WBD were inclined to recommend a lawsuit challenging it on the grounds that the combination of the two movie studios would be "anticompetitive and violate antitrust law." The paper reported that the antitrust staffers who investigated the proposed merger "didn't participate in writing" the Justice Department statement clearing the deal. On Friday, the DOJ issued a statement saying in part, "The [Antitrust] Division has completed its analysis of the proposed merger of Paramount and Warner Bros. and determined based on the evidence received in its investigation that the transaction is not likely to result in harm to competition or American consumers." Asked for comment on the Journal report, a DOJ spokesperson said: "The Antitrust Division conducted a thorough investigation to assess whether the proposed transaction would harm competition. The investigatory record indicated that the transaction will increase competition across the media and entertainment ecosystem, benefiting American consumers and workers." The DOJ rep also pointed to a post on X by Associate Attorney General Stanley E. Woodward Jr., the DOJ's third highest-ranking official, directed at Journal reporter Sadie Gurman. Woodward wrote, "a team of career lawyers never reached out to anyone in their leadership chain of command to express this, but instead reached out to you? Please let your anonymous sources know that my door is always open." The DOJ's Antitrust Division announced June 12 that it was closing the Paramount-WBD probe, without imposing any requirements for divestitures or other concessions on the part of David Ellison's Paramount Skydance. "[T]he film and television industry is highly dynamic, and the proposed transaction is not likely to harm competition or American consumers," the DOJ's Antitrust Division said. In a statement Friday, Paramount Skydance said in part, "We are grateful for the Department of Justice's thorough review of this transaction, as well as the work of the other agencies that have completed their reviews and provided clearance to date." Notably, Ellison last fall recruited Makan Delrahim, who had headed the DOJ's Antitrust Division during Trump's first term, as Paramount's chief legal officer. Paramount still faces other potential roadblocks to closing the WBD deal, which the companies have said they expect to happen by September 2026. Among those: State attorneys general including California's Rob Bonta have indicated they will potentially move forward with litigation seeking to block the Paramount-WBD merger on antitrust grounds. California will be joined by New York and other states in a lawsuit seeking to block Paramount-WBD to be filed "in the coming weeks," per a Reuters report earlier this month. Meanwhile, the European Commission is investigating the deal under the EU's Foreign Subsidies Regulation, looking at the approximately $24 billion being fronted for the takeover by the sovereign wealth funds of Saudi Arabia, Qatar and Abu Dhabi. The EU set a provisional July 14 deadline for vetting the deal under the law, according to a notice posted on the regulatory agency's site. That's in addition to its investigation of potential anticompetitive issues under standard merger rules with a July 7 deadline. And on June 9, the U.K.'s competition regulator, the Competition and Markets Authority, said it initiated an investigation into the proposed Paramount-WBD deal. While David Ellison isn't an all-out Trump booster, he and his father — tech billionaire Larry Ellison — are friendly with Trump. In April, David Ellison and Paramount hosted a soiree in D.C. "honoring" Trump, with the event also ostensibly meant to celebrate the First Amendment. The pending Paramount-Warner Bros. Discovery megamerger would bring bring together Paramount assets including CBS, CBS News, Paramount Pictures and Paramount+ with WBD's HBO and HBO Max, Warner Bros. Pictures, CNN, TNT, TBS, HGTV and more. Paramount execs have said they anticipate achieving more than $6 billion in cost savings through the merger with Warner Bros. Discovery, indicating they would initiate sizable layoffs at the combined company.

(Source：Google News)