LOS ANGELES: Xavier Becerra, the Democratic candidate and frontrunner in the race for California governor, says a settlement would be the best outcome in the state attorney general’s lawsuit to block the US$110bil merger between Paramount Skydance Corp and Warner Bros Discovery Inc.
Becerra did not take a side on the merger, saying he wants whatever outcome is good for the industry and the state.
“The entertainment industry is our baby in California.
“We have to fight to keep it vibrant,” Becerra said on Tuesday afternoon at a Politico event in Sacramento.
“I hope it settles before court. It is easier to stand in a conference room and settle than it is to stand in a courtroom.”
Antitrust cases “are very difficult”, said Becerra, who served as the state’s attorney general from 2017 to 2021.
“The most important aspect of this entire matter is: Is it going to help Hollywood?
“Is it going to keep the industry vibrant?”
California and 11 other states with Democratic attorneys general sued to block the Warner Bros deal last month.
The suit alleges the transaction would give the company unfair control of the movie and cable-TV businesses.
Becerra’s remark came hours after California’s current attorney general, Rob Bonta, also a Democrat, called reports that Paramount Skydance plans to leave the state if its top lawyer doesn’t settle the lawsuit “blackmail” in a post on social media.
Paramount’s board has approved a possible move from California as early as Oct 1, according to a person familiar with the company’s plans.
Its chief executive officer David Ellison told senior executives last week that the move would involve headquarters staff first but that he’s putting together a five-year plan that would shift most of the film and TV studio’s jobs to the new home, according to the person, who asked to not be identified because the internal deliberations aren’t public.
The five-year plan could involve a sale of one of the two big studio lots owned by Paramount and Warner Bros in the Los Angeles area, if the merger ultimately goes through.
The states being considered are Tennessee, Georgia, Texas and one other that hasn’t been identified.
The newsletter Puck and Variety reported earlier on Paramount’s plans.
Paramount’s top lawyer, Makan Delrahim, rejected the blackmail accusation when he spoke at the Politico event.
Ellison is “committed to be in California”, Delrahim said.
“There’s a point though where you have a fiduciary duty to your shareholders.”
“Having a major player in the industry leave the state would not be good,” Becerra said.
“So, let’s be adults, not be kids.
“Conference room, not court room,” he said, before adding that “there’s always a deal”. — Bloomberg
