The three largest movie theater chains in the United States—AMC Theatres, Regal Cinemas, and Cinemark—are urging California to settle an antitrust lawsuit challenging Paramount's proposed merger with Warner Bros. Discovery. This collective stance represents a significant development in the ongoing legal and business maneuvering surrounding the potential $110 billion deal.
Cinemark became the latest major theater operator to publicly back the merger on Tuesday, following similar endorsements from AMC and Regal. In a statement, Cinemark noted that "collectively benefit most when all stakeholders work together in pursuit of shared industry objectives, including creating and releasing compelling films, attracting audiences to theaters and fostering long-term growth." The company added that "prolonged uncertainty runs the risk of diverting time and resources away from achieving these priorities," calling for an expedited resolution.
The theater chains' support for the merger comes after Paramount CEO David Ellison made concessions, including a pledge to produce 30 films annually for theatrical release, with an exclusive theatrical window of 45 days. Ellison has committed to upholding these terms for at least three years.
Industry observers suggest the theater chains' swift support indicates a concern that a protracted legal battle between two major Hollywood studios could further harm an industry still recovering from the pandemic. The lawsuit, filed in July by California Attorney General Rob Bonta and joined by 12 other state attorneys general, argues that the merger would reduce competition and ultimately lead to higher prices, lower quality content, and less variety for consumers. The states' complaint alleged that the combined company would control 30% of movies that gross over $100 million at the box office.
California's case faces a potential setback following the theater chains' endorsements, as Bonta's central argument hinges on the deal harming the film industry. A judge previously set a March 2027 trial date for the lawsuit, a timeline that Paramount had hoped to avoid. The merger agreement includes a provision requiring Paramount to pay a $7 million per day "ticking fee" if the deal is not completed by October 1, indicating the financial pressure to reach a settlement.
Cinema United, a global movie theater lobbying group, also shifted its stance to support the deal on Tuesday, with its leader Michael O'Leary emphasizing the need for industry-friendly commitments from Ellison. O'Leary had previously expressed concerns that the merger could lead to fewer films and the closure of theaters.
Together, AMC, Regal, and Cinemark represent approximately 60% of U.S. movie ticket sales and operate about 1,230 domestic theaters with roughly 16,700 screens. Paramount has stated that the merger has already received approval from the U.S. Department of Justice and regulators in the European Union, the United Kingdom, Australia, and China. The proposed transaction would consolidate streaming services like HBO Max and Paramount+, along with networks such as HBO, CBS, and CNN, under a single corporate umbrella.