California Attorney General Rob Bonta has canceled settlement talks with Paramount Global, accusing the media company of acting in bad faith and leaking details from preliminary discussions. The abrupt cancellation of Monday's meeting signals a deepening rift between the state and the entertainment giant, which is reportedly considering relocating its headquarters to Tennessee.
Bonta pulled the plug late Sunday, stating that Paramount had not only leaked information from a Friday meeting but also misrepresented its substance. "As soon as Paramount stops playing games and engages sincerely, my office is happy to meet again," Bonta said in a statement. The attorney general had planned to discuss potential concessions, including the divestiture of cable networks and protections to keep Warner Bros.' movie studio separate from Paramount Pictures, according to reports.
The collapse of the talks comes as Paramount Global, led by CEO David Ellison, is reportedly weighing a move from California. The Wall Street Journal reported that Tennessee has emerged as the company's preferred destination for a new headquarters. Paramount has also explored a potential movie and television studio facility in Austin, Texas.
The standoff stems from California and 11 other states suing to block Paramount's proposed merger with Warner Bros. Discovery. State officials argue that the combination would reduce competition in theatrical movie distribution and basic cable programming. The Justice Department, however, cleared the transaction in June.
Paramount faces increasing financial pressure to resolve the antitrust battle. Under the merger agreement, the company must begin making substantial additional payments to Warner Bros. shareholders if the transaction has not closed by October 1. These payments could amount to roughly $650 million per quarter, potentially exceeding $1 billion if the dispute extends to the trial scheduled for March.
This potential relocation has raised concerns among California state officials. Governor Gavin Newsom has stated he takes Paramount's threat to leave seriously, expressing concern for the state's reputation and the thriving Hollywood industry. Los Angeles Mayor Karen Bass has also called for a swift resolution, warning of fallout for entertainment industry workers and productions.
Ellison has reportedly been evaluating alternatives outside California, including Tennessee, Texas, and Georgia, as the legal fight continues. The media company has resisted concessions involving divestitures or controls on how its businesses would be run, pointing instead to commitments such as producing 30 theatrical releases annually.