Paramount Considers Leaving California Amid Antitrust Suit (variety.com) 177
Paramount CEO David Ellison is threatening to begin moving the studio out of California on October 1 if state Attorney General Rob Bonta refuses to enter settlement talks over the proposed Paramount-Warner Bros. Discovery merger. The company would reportedly move its Los Angeles headquarters first and shift most studio jobs out of the state over five years, with Georgia, Texas, and Tennessee under consideration. Variety reports: Ellison's threat to relocate Paramount in retaliation for California's Bonta leading the charge to kill the WBD deal -- a move that would include much of its studio operations, over time -- was first reported by industry newsletter Puck. In response, Bonta called Ellison's planned exit from the state an "attempt to blackmail the state into letting an illegal deal through."
"Paramount has lost the plot as it continues to lose in court," the attorney general wrote in a post on X. "It didn't work the first time -- on the eve of our July lawsuit -- and it won't work this time." Bonta has not publicly said what concessions from Paramount-WBD he would consider acceptable enough to take the lawsuit off the table. But the Democratic attorney general has said any remedies would need to be "structural" (i.e., divestments) rather than "behavioral" (e.g., imposing certain production quotas).
Oct. 1 is when Paramount will begin accruing a "ticking fee" payable to Warner Bros. Discovery shareholders of $7 million per day. The trial in the state AGs' lawsuit is scheduled to start March 2, 2027, roughly five months after that, so Paramount would be on the hook to pay around $1.2 billion to WBD shareholders by the time the trial is scheduled to conclude. (Paramount's ticking-fee payments to WBD are not due until the deal closes.) At the Aug. 5 meeting on Paramount's lot, Ellison told his 12-member senior executive team he expects Paramount to prevail in the antitrust case against the states. However, he also said that if Bonta balks at talks, Paramount will start packing up and moving out of the Golden State in less than two months.
"Paramount has lost the plot as it continues to lose in court," the attorney general wrote in a post on X. "It didn't work the first time -- on the eve of our July lawsuit -- and it won't work this time." Bonta has not publicly said what concessions from Paramount-WBD he would consider acceptable enough to take the lawsuit off the table. But the Democratic attorney general has said any remedies would need to be "structural" (i.e., divestments) rather than "behavioral" (e.g., imposing certain production quotas).
Oct. 1 is when Paramount will begin accruing a "ticking fee" payable to Warner Bros. Discovery shareholders of $7 million per day. The trial in the state AGs' lawsuit is scheduled to start March 2, 2027, roughly five months after that, so Paramount would be on the hook to pay around $1.2 billion to WBD shareholders by the time the trial is scheduled to conclude. (Paramount's ticking-fee payments to WBD are not due until the deal closes.) At the Aug. 5 meeting on Paramount's lot, Ellison told his 12-member senior executive team he expects Paramount to prevail in the antitrust case against the states. However, he also said that if Bonta balks at talks, Paramount will start packing up and moving out of the Golden State in less than two months.
If they think they can blackmail the government... (Score:5, Insightful)
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Re:If they think they can blackmail the government (Score:4, Insightful)
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Hey now, Paramount's corporate headquarters is in NYC. I'm sure they can just ...ahh...well, maybe that wont work out so well for them either.
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regulators? Like the FCC? Who gets their panties in a wad because Jimmy Kimmel told the truth about el Bunko's kickback schemes?
Don't let the door hit you on the way out (Score:5, Insightful)
If they're willing to issue threats like this, what will they try next if California capitulates?
This is one of those scenarios where if you give a planck length, they'll take the entire observable universe.
Next it will be: If you don't repeal the California non-compete law 16600, we will pull out of California.
Callifornia's response should be: We don't deal with businesses which operate in this manner: GTFO before we tax you even more.
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This is one of those scenarios where if you give a planck length, they'll take the entire observable universe.
Wonderful phrasing!
More evidence we made the right decision (Score:5, Insightful)
My spouse and I greatly enjoyed Star Trek: Strange New Worlds, and consider it to be one of the best Star Trek shows ever done. But we didn't renew our Paramount subscription to watch it. This was due to Paramount and Ellison turning CBS news into Trump's mouthpiece, and doing things like spike Sixty Minutes episodes which were critical of Trump's deportations and only aired after it had essentially been accidentally leaked online, months after it was supposed to run https://www.pbs.org/newshour/nation/cbs-airs-60-minutes-report-on-trump-deportations-that-was-suddenly-pulled-a-month-ago [pbs.org]. The real final straw for us was when Paramount became the only channel to watch Trump's MMA event in front of the White House.
As I discussed with my spouse, I could imagine a Star Trek episode involving a world where there was a terrible media corporation and people kept supporting it despite the evil it did because it had their regular entertainment. And then, I could see what Captain Pike would have said to those people in some speech asking if that's really worth it? So, what would Captain Pike have me do? I guess in the actual ethos of Star Trek, a show which cares about progress, and diversity, and accepting people of all sorts, and standing for democracy and freedom against oppressors wherever they are, we will not give money to Paramount under its current leadership. And given Ellison's new threats, it seems like that decision was even more justified.
Re: More evidence we made the right decision (Score:3)
I plan to cancel HBO Max if this deal goes through. Will be happy to see this dipshit lose all his daddy's money.
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Re: More evidence we made the right decision (Score:2)
Netflix.
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Re: More evidence we made the right decision (Score:2)
Indicental is a perfectly cromulent word.
Re: More evidence we made the right decision (Score:2)
Sounds like a scenario for a low budget film that sets Star Trek in a David Elisson / Trump world. Maybe even find a way to craft that into an episode featuring an authoritarian dystopian world.
Sure it might result in some people getting fired, but there is a good chance theyâ(TM)d not be following the company out of state anyhow?
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Re: More evidence we made the right decision (Score:2)
Vote with your dollars.
There is a lot of BS on slashdot these days so itâ(TM)s awfully nice to see a post like this every once in a while. Good on you both.
As a sidenote, I love strange new worlds as well. I donâ(TM)t understand anybody saying they didnâ(TM)t like it. Didnâ(TM)t give a cent to Paramount for any of it eitherâ¦
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Re:More evidence we made the right decision (Score:4, Insightful)
This is why when people say the market decides they are wrong. If you can't sway a companies positions or politics by refusing to shop there then there is no way the market decides anything. The rich decide.
Why would you want to give your money to someone who idealotically is acting against your beliefs?
If I thought the money I was giving to netflix was being used to fight an strongly held core belief I would stop. No different then all those beer drinkers giving up that piss beer because a trans person got a 6 pack.
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This is why when people say the market decides they are wrong. If you can't sway a companies positions or politics by refusing to shop there then there is no way the market decides anything.
The problem with the above is that you are mistaking "yourself" for "the market."
"Everyone isn't doing what I want them to, obviously 'the market' is broken."
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Actually I am not. I'm saying that the attitude above is why I believe the system is broken.
Basically the post I replied to stated that they would not "cut off their nose to spite their face" and stop watching a TV show no matter how terrible the companies policies or owners beliefs may be.
Re: More evidence we made the right decision (Score:2)
This is why when people say the market decides they are wrong. If you can't sway a companies positions or politics by refusing to shop there then there is no way the market decides anything. The rich decide.
I see you've never heard of Anheuser-Busch or Target.
Re: More evidence we made the right decision (Score:2)
Voting with dollars seemed to work pretty well with Xbox PC Game Pass. I cancelled when that dipshit Spencer raised the price to $30/mo. When the price lowered back down after the financial backlash I resubscribed.
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"Some wirbles are wobbles, therefore all wirbles are wobbles."
No, you're wrong.
Re: More evidence we made the right decision (Score:2)
Voting with dollars doesn't work?
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drop in the bucket (Score:5, Interesting)
The entire entertainment industry provides about 1.4% of California's tax revenues. Paramount is only a small fraction of that. Not much leverage against the 4th largest economy in the world.
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Yes, but it makes Larry's sprog feel important.
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What the fuck are you on about? They have a $4 trillion economy.
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And blocking this merger is just plain stupid anyhow. WB is going to fail otherwise.
Not my problem.
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Here [us-debt-clock.com] is the actual data on state government debt. California's per-capita debt is $2833, which is very close to the national average of $2637. States cover a huge range from Idaho with only $356 to Alaska with $9418. California is right in the middle of the pack.
Comparing that to the US federal government's debt ($114,136 per person!) is absurd. Even Alaska's debt is tiny in comparison.
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And also brutally sad. When did we decide that governments can just piss away money they don't have, making everything else so much more expensive (deficit spending creates inflation)? How is it that every damn state is in debt, including those that are required to have balanced budgets?
My new theory is that government got a taste for deficit spending during the depression and now its hooked worse than a junkie.
Re: drop in the bucket (Score:3)
Re: drop in the bucket (Score:2)
It's not the debt that bothers you, it's the government services. You're just hiding the ball so you don't have to seem so Republican.
Re: drop in the bucket (Score:2)
Re: drop in the bucket (Score:2)
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How is it that every damn state is in debt, including those that are required to have balanced budgets?
That's easy: states issue bonds. In California, voters decide if there's to be a bond issue for some project or need. The results are predictable, especially if the bond propositions are written in a manner that makes it hard for the average voter to understand what they're voting for.
Re: drop in the bucket (Score:5, Informative)
Why do you people have so many weird fantasies about California? Obsessed much? It's fucking weird, dude.
No state has ever gone bankrupt. California's economy is the fourth largest in the world.
Take your meds. Reconnect with reality.
Re: drop in the bucket (Score:5, Interesting)
Why do you people have so many weird fantasies about California? Obsessed much? It's fucking weird, dude.
No state has ever gone bankrupt. California's economy is the fourth largest in the world.
Take your meds. Reconnect with reality.
And yet, with all that economy, they still can't make budget [calmatters.org]
One could be forgiven for saying they can't afford to lose a single dollar of potential tax revenue.
You're assuming they'll lose tax revenue and that they aren't spending more money on Paramount than they get back. Given this country's penchant for corporate welfare, I wouldn't assume that Paramount leaving would be tax-flow-negative. More specifically, after all of the incentives, tax credits, etc. are taken into account, I wouldn't assume that the loss from Paramount leaving would be greater than the loss from Warner Brothers largely ceasing to exist except as an IP licensing subsidiary of Paramount.
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And yet, with all that economy, they still can't make budget. One could be forgiven for saying they can't afford to lose a single dollar of potential tax revenue.
California has a balanced budget, and money in a rainy-day fund. The problem is it relies on extra money from windfall taxes every year to achieve it. Usually there is even a surplus.
It is like planning your budget based on getting a good bonus check at work. It may work out every time... until it doesn't and you cant pay the mortgage.
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Except that California has been bankrupt for years, and every penny makes it harder to hide.
California has a balanced budget, money in a rainy-day fund, and ...a bunch of unfunded obligations that will bite it in the ass if ignored.
California relies on windfall taxes to survive. As long as the market is booming and tech businesses keep growing, it has extra money year after year. It keeps spending that extra money on new programs that cost money in the future to maintain -betting that it will again get extra money to pay for them. It works because the tech industry keeps finding new ways to mak
Re: drop in the bucket (Score:2)
Re: drop in the bucket (Score:2)
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Re: drop in the bucket (Score:2)
Paramount is bluffing (Score:5, Interesting)
Could that regulatory climate be recreated elsewhere? Of course it could. Will it? Unlikely, and certainly not in the next two months. But hey, who needs child actors or a clear process for managing liability when an action hero accidentally ends up inside a real wood chipper? Not Ellison!
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More and more production has been moving out the US entirely, to countries that absolutely love all those US dollars. Been going on for decades, and will continue to accelerate.
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Let's see how much talent is willing to follow him to work for slave wages and under truly dangerous conditions.
Re: Paramount is bluffing (Score:3)
They could just flee to Canada though. A lot of production is done there these days because it's cheaper.
The question is, will Canada let them play the same accounting games they play here? Because the reason we won't miss them when they're gone is that movie studios are well known for accounting tricks that make it look like they are losing money when they aren't so they don't have to pay their full tax burden.
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AKA "Texas"?
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California has countless context-specific legal exemptions across a broad swath of [ California's ] labor and safety regulations
In other words they still have more labor and safety regulations in place than the average state. You know... "known to the State of California to cause cancer" stickers all over everything, etc.
Re: Paramount is bluffing (Score:2)
There's no reason for a state to sit down with a bad faith actor. When he wanted this deal to go through he went to his daddy and his daddy's orange daddy. Since he didn't want a seat at the table to have a discussion, the state shouldn't play his games.
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In any case, all Ellison has appeared to ask is that the states start negotiation.
Actually, other reporting suggests that Ellison stated in the meeting with his executives that a full agreed upon settlement with the states must occur before Oct 1st so that he can close before having to start paying the WBD ticking fees. That is an ambitious schedule, especially since he is unlikely to agree to the structural remedies (i.e. divestitures) that the states have suggested would be necessary for any settlement.
This is the kind of threat you can only make once, and you may need to actually
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They exist in Georgia. Heck, they probably exist in every State where they do a lot of filming. New York, for example. Ellison knows his business better than either of us, and if he thinks Texas and Tennessee are viable, they probably have the rules he's looking for as well.
Each state has slightly different regulations, but dangling the possibility of a large influx of jobs and revenue will create the usual feeding frenzy of the politicians who will agree to get the regulations adjusted to whatever Ellison wants.
They don't pay any taxes anyway (Score:2)
California is a nice place to live with a really good economy. You can't just threaten to leave and have anyone give a shit.
On the other hand if a company is leaving California it's generally because they want to either break the law and get away with it or do terrible things to their employees both of which ar
Makes no sense (Score:5, Insightful)
This is absurd on so many levels.
To start with, it's not like the lawsuit has anything to do with what state they're based in. The California AG happens to be leading it, but it's a coalition of 12 states. It's not as if they could escape the suit by moving to another state. This is purely a pressure tactic, nothing more.
Actually moving would be incredibly expensive. Build entirely new studios. Relocate all their employees. Lose a whole lot of employees who don't want to relocate.
And anywhere else they moved to would be a worse place. They're located in Los Angeles because that's the heart of the film industry. That's where the workers are. That's where all the other companies that support the industry are. Trying to operate in Georgia or Tennessee would be much harder for them.
Even if they somehow decided it made sense to move, that's not a decision you make quickly or lightly. It would take long and careful planning to choose a new location and prepare for the move. But here he is, saying they're going to start moving in less than two months, and he hasn't even decided what state to move to. Is anyone really supposed to take this seriously?
If in spite of everything he really tries to go through with this, expect a shareholder lawsuit and calls for the board to fire him. But he'd have to be crazy to really do it.
Paramount is a Controlled company (Score:2)
How the Ellison Family Controls the Paramount-Warner MergerIn the context of the newly created media giant, the Ellison family—primarily led by Larry's son, David Ellison (CEO of Paramount Skydance)—exerts absolute voting authority through a multi-tiered corporate structure, rather than a standard single-class share model.
"" The Core Voting Power (National Amusements): The foundation of this media empire relies on a traditional dual-class system originally built by the Redstone family. Through t
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They're located in Los Angeles because that's the heart of the film industry. That's where the workers are. That's where all the other companies that support the industry are. Trying to operate in Georgia or Tennessee would be much harder for them.
Also don't forget the film and TV industry settled there in large part because of the reliable climate - it doesn't matter as much with inside studio recording, but there's a lot of exterior filming that happens on those huge back lots for pretty much every show and movie. Compared to SoCal, Texas heat is absolutely brutal - and Geogia/Tennessee heat + humidity + thunderstorms + tornado warnings + whatever will make it miserable - not to mention the very real costs related to all those delays that will need
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They plan to move anyway. The costs are already baked into the 5 year plan.
New location, new employees, new direction from the silent partners. Saudi Arabia put up 24 BILLION dollars cash to fund this deal. They want a particular slant on all future films, news, broadcast and streaming. It is easier to convince new employees to go in a new direction than to convince existing employees to reverse course.
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If in spite of everything he really tries to go through with this, expect a shareholder lawsuit and calls for the board to fire him.
Some of the shareholders might sue if they believe the actions will result in losses, but the board is fully captured (the Ellison family owns the voting shares of the company, and therefore controls the board).
Heck yeah, Sunset Melrose coming soon (Score:2)
I'm looking forward to this.
let me break the law (Score:2)
or I'm taking my ball and going home!
This is why we have bad laws and sweetheart deals on the books, politicians cave to these stunts way too often.
I hope CA stands their ground. The jobs they're threatening to leave with will be worth a lot less anyway if CA caves and the jobs stay. That's the whole reason they're being sued.
Bye, Felicia (Score:3)
These mega corps wouldn't be in California if it wasn't critically necessary. Try moving to Texas with no generational talent, no blue collar workers, no union buy-in.
This is just whining of pathetic nepo welps.
Read the room (Score:2)
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If what you say about "raping" the big companies by unions were true, the big media companies would be getting smaller and poorer, not richer and larger. No matter how you cut it, more and more wealth is being concentrated in fewer and fewer people, and that is accelerating. And they get handouts from governments all the time (our tax dollars).
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Depends on how you look at it. There were more "big" companies in the past, but they've been weakened to the point that consolidation has reduced that to a "few" big companies with lower margins. Not sure if the pool itself is smaller or poorer, but there are definitely less pieces of the pie.
Re:Is Bonta an economist now? (Score:4, Insightful)
Not sure what credentials Bonta has to determine how the media and entertainment industry is supposed to operate but he sure seems to be confident in his private opinions.
They're supposed to FOLLOW THE LAW. Bonta is qualified to speak to that. Who the fuck are you? Nobody? 10-4, good buddy.
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Care to point out the part(s) of the Clayton Act that you can prove would be violated by this merger? Market-share concentration, perhaps? HHI, maybe?
Bonta's claim is that the merger would result in market shares of about 27% cable-channel licensing and the same in wide-release film distribution, and around 30% in "anticipated blockbuster distribution". This last one is a real reach as it is very tough to predict what's going to go big at the box office in any given year. See https://oag.ca.gov/system/file. [ca.gov]
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You might be right about your deck chair analogy. The entire industry is in trouble, which means mergers become necessary for the players to survive at all. It would be worse for California and the industry if a major player like WB went bust. A lot of value would be lost, as would a lot of jobs. During a big industry shakeup, competitors will be lost regardless. Might as w
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It would still cost them a lot to move. Even if there aren't as many things to move, think of the cost for relocating the staff.
Figure $5000 to $10,000 per employee. 3,000 direct jobs. So $15M-$30M to relocate the employees.
Re: Is Bonta an economist now? (Score:2)
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The industry is in trouble because mergers reduced the jobs, and the remaining jobs didn't go to the most creative people, they went to the people who were best at cultivating influence. Which is almost never the same people that do the quality creative work. They're driven by completely different fundamental motivations.
Further consolidation will just damage things even more, until finally there isn't anything to consolidate with to kick the can and the companies collapse, and then a new cycle can be start
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Why would they relocate the staff?
Re: Great (Score:2)
They probably already wanted to do that anyways. Probably to Atlanta. I've lived in LA for the past 4 years, and pretty much everybody in the movie business is talking about how they can't really get any work here. Main reason why is it's cost prohibitive and overregulated, a lot of both having to do with FilmLA, but a lot of other reasons as well. California is very hostile to its bread and butter industries overall, and I think the government has it in its head that nobody will ever leave. The problem wit
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Unfortunately there is a large number of film crew workers in LA that have been pushed beyond the point of breaking by the parlorous state of the film industry since the pandemic more or less destroyed the film theatre economy. Though there have been some signs of it picking back up again.
The reality is, if the market regulators hadn't been completely gutted by special interests this merger would never have gotten this far. Between FCC market concentration laws and anti monopolization laws, this was never a
Re: Great (Score:2)
Unfortunately there is a large number of film crew workers in LA that have been pushed beyond the point of breaking by the parlorous state of the film industry since the pandemic more or less destroyed the film theatre economy. Though there have been some signs of it picking back up again.
That's sugar-coating it -- this IS a long-term decline for Hollywood. If this was a pandemic blip, it should have already recovered, just as everything else has done long since then. The film industry itself is fine, just away from Los Angeles.
Re:Great (Score:5, Insightful)
It's cute you don't think he's going to do it anyway shortly after the deal closes...
Re:Great (Score:4, Insightful)
This. Look at Oracle as an example. Moved their HQ from California to Austin, Texas in late 2020. Then in 2024 they announced they are moving to Nashville, TN. So there is no reason trust or depend on them for anything. They will probably leave CA regardless. And it perhaps someone will kickstart a new studio to make more interesting, more entertaining content than that Succession wannabe at Skydance/Paramount
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Moving their corporate HQ is only a tax dodge for the corporation. They will still have a significant presence in California, because that's where the fucking movie biz is, and that's where the Paramount lot is, and that's where the Warner Brothers lot is. They are not moving any of that, because then they would not have sound stages and all the supporting infrastructure for actually making films and TV shows.
It's all bullshit.
Re:Great (Score:4, Insightful)
He's not doing it. He's not going to do it anyway. He won't do it whether CA sues him or not. The entire movie making industry is in Hollywood. That's where the talent goes. Companies start in other parts of the country and then either go bust or move.
It's even less likely to happen than Tesla will finish its move to Texas.
People aren't going to move out of California just to work for some RWNJ when most of the jobs in that field are in LA.
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"The entire movie making industry is in Hollywood."
It used to be.
https://variety.com/2026/tv/fe... [variety.com]
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The main way that the US has projected its culture throughout the world has vastly diminished. We're in a setting sun empire, and it's unfortunate that self-decsribed patriots choose to bury their head in the sand and deny reality itself. Effectively the greatest anti-American threat we have faced as the people who insist that nothing is wrong, and that we should go back to the good old days, regardless of where the rest of the world is today. A bunch of isolationist weirdos that are convinced they can run
Re:Great (Score:4, Interesting)
Oh no! $500 million dollars taken away from the $275 BILLION collected in taxes. What ever will CA do without that $500 million?!?
nobody-cares.gif
Re:Great (Score:5, Informative)
Oh no! $500 million dollars taken away from the $275 BILLION collected in taxes. What ever will CA do without that $500 million?!?
Guessing California will still be the 4th largest economy in the world [ca.gov].
2024 Nominal GDP
- United States: $29.18T (I think this excludes CA GDP, below)
- China: $18.64T
- Germany: $4.65T
- California: $4.10T
- Japan: $4.02T
- India: $3.90T
- United Kingdom: $3.64T
California is followed by Texas is at $2.9T and New York is at $2.4T.
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#1 in homelessness? Wouldn't be that way if lying ass red states weren't one-way busing people over here. Yea we're picking up YOUR fucking slack, loser.
#1 in Poverty? Uh you mean Puerto Rico, followed by Louisiana and then Mississippi.
#1 in highest taxes? On $100,000 income, Alaska ranks #1 with the lowest total tax while Oregon has the highest. California ranks #41.
#1 in lowest literacy rates? Nope! Most people can READ THEIR NATIVE LANGUAGE. They are not illiterate. Language is the primary driver of NOT
Re: Great (Score:2)
If you read a history book, you'll find:
- The US has always been infighting
- Outsiders who physically attack us suddenly find all of that infighting energy channeled directly into their faces
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Your bothsides examines a false choice caused by reductio ad absurdum. Three bad faith arguments in one!
To wit: yes, both political parties feature lying politicians. However, one party has FAR MORE liars, that lie on a daily basis, about literally everything. It's also the party that is apparently fine with domestic violence and sexual abuse judging by the multiple credibly accused members of Congress that belong to that party, as well as the convicted fraud who is the party leader, with absolutely no c
Re: Great (Score:2)
With all the real problems we have here in California, why did you bother making up a few fake ones. To serve some narrative?
Re: Great (Score:2)
Re: Great (Score:2)
Re: Great (Score:2)
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#1 in poverty is Louisiana - followed by Mississippi - BOTH RED STATES https://worldpopulationreview.... [worldpopul...review.com]
#1 in taxes is Hawaii - a RED STATE https://wallethub.com/edu/stat... [wallethub.com]
#1 in illiteracy is New Mexico - followed by Louisiana & Mississippi. Again, RED STATES. https://usafacts.org/articles/... [usafacts.org] This is tied to poverty - see 1st point
Get your head off Phaux Noise and look at facts.. oh, i guess your "dear leader" doesn't look a facts so your ignorance is par.
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Only 1.25 Trillion compared to the nearly 20 trillion in debt Trump put on the country.
Go fuck yourself.
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And it only ever goes up.
So does the national debt. And no one gives a shit about that either.
Re: Great (Score:4, Insightful)
More like we don't have to give them tax credits anymore.
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