Longshot Bid to Block Paramount-Warner Bros. Discovery Merger Filed to Supreme Court

An emergency bid has been filed challenging Paramount‘s $110 billion megadeal for Warner Bros. Discovery, the closing legal salvo over a merger that will reshape Hollywood.

Paramount subscribers, in a court document filed on Monday, ask Justice Elena Kagan to issue an order that would stop Paramount from closing the deal until their case is considered. The merger goes through on Tuesday.

Last week, U.S. District Judge Araceli Martinez-Olguin signed off on a settlement agreed to by Paramount, the states and the Writers Guild of America resolving the case. She also declined to issue a last-minute temporary restraining order requested by Paramount subscribers. In the first lawsuit challenging the deal, they had alleged that the acquisition will substantially throttle competition in streaming, news and theatrical distribution in violation of antitrust laws.

In Monday’s filing, the subscribers claim that the terms of the states’ deal “do not preserve competition between Paramount and Warner Bros.”

Under the agreement, Paramount and Warner Bros. must release at least 30 theatrical films a year for the first two years and 32 for the following three, maintain minimum numbers of wide and independent releases, and ensure that at least half of the films are produced or jointly produced by the combined company. Other notable terms: Keeping Paramount and Warner Bros. basic-cable negotiations separate and creation of a five-member independent board overseeing editorial standards at CBS News and CNN (selected by Paramount). A violation of the former term could see an order forcing the studio to divest from BET, VH1 and Comedy Central, among other channels, though blue-chip assets like CNN or New Line Cinema are not on the table in these divestiture scenarios.

The subscribers argue that Martinez-Olguin improperly rebuffed their bid for a temporary restraining order “on a premise the record directly contradicts.” They challenge her conclusion that they did not offer enough evidence showing that the merger should be stalled.

The filing also says that public interest favors freezing the deal until the Supreme Court considers the case.

For the 11th-hour filing to be successful, the Supreme Court would have to immediately issue an order stopping Paramount from closing.

On Tuesday, David Ellison announced the senior executives who will help him run the combined Paramount-Warner Bros. Discovery. He will be chairman and CEO, with former Mattel chief Ynon Keiz joining him as co-CEO. Casey Bloys will run Skydance’s streaming business, with Josh Greenstein and Dana Goldberg overseeing the combined company’s film studios. Mark Thompson will continue to operate CNN.