California Attorney General Rob Bonta announced a settlement with Paramount on Monday, a move that has reportedly left insiders close to his office bewildered and frustrated. Sources described Bonta as appearing near tears as he presented the deal, which they characterized as a significant concession to Paramount and its CEO, David Ellison.
Sources involved in the negotiations expressed shock at the swift resolution, stating that the settlement appears to offer little in the way of concessions from Paramount. "There’s almost nothing in here with all the filings, statements, and law on their side that reflects they got anything," one insider told Page Six. "They caved across the board and I don’t know why. Clearly someone pressured him to do this."
The settlement comes after months of legal challenges from Bonta and 12 other state attorneys general. Despite Bonta’s earlier insistence on “meaningful” structural remedies, such as divestitures, the final agreement reportedly lacks these significant demands. The terms of the settlement are reportedly only binding for the next five years, leaving the long-term implications uncertain.
Sources suggest that political pressure may have influenced Bonta’s decision. Reports indicate that Governor Newsom, LA Mayor Karen Bass, and potential future governor Xavier Becerra, among others, may have urged a resolution. David Ellison reportedly made it clear that Paramount might relocate its operations out of California if a deal was not reached. The potential political repercussions for these figures, especially those with future electoral ambitions, may have outweighed the antitrust merits of the case.
In a press conference announcing the settlement, Bonta attempted to frame the outcome as a success, stating, "This settlement is not a vote of support for this merger. It is not a blessing of the broader merger. We got the antitrust resolution that we wanted." However, this sentiment did not resonate with all involved. William Tong, the Attorney General for Connecticut and one of the supporting AGs, expressed disappointment that more could not be achieved, particularly regarding the potential divestiture of CNN.
Despite the internal dissent, Bonta maintained that the agreement was unanimous among the 12 states. He was vague about the timeline of the final negotiations, only noting that significant progress was made in the last week, with the final 1% of the deal proving the most challenging.
David Ellison, following the settlement announcement, affirmed that the newly merged company would remain headquartered in Los Angeles, stating, "We aren't going anywhere." However, Bonta acknowledged that the settlement does not legally obligate Paramount to maintain its headquarters in the city.
Paramount and Warner Bros. now anticipate the deal to be finalized within the next two weeks, just ahead of an Oct. 1 deadline that would trigger additional daily payments from Paramount to Warner Bros.
The sudden shift in negotiations has led some to speculate about Bonta's own political aspirations and whether he sought to avoid a contentious legal battle that could impact his career.