Paramount and a coalition of 12 state attorneys general defended their antitrust settlement Monday against a series of criticisms raised last week by New Jersey Sen. Cory Booker.
In separate filings, both sides argued that the deal was vigorously negotiated, had “teeth” and should not be subject to independent “public interest” review. Paramount argued that the deal addressed the state’s main concern, namely a reduction in theatrical releases after its merger with Warner Bros. Discovery.
“The proposed consent decree eliminates this risk of reduced production after the merger,” Paramount’s lawyers wrote, adding that the deal “provides certainty to exhibitors and the industry as a whole: a guaranteed and enforceable pipeline of new releases every year.”
Booker wrote last Thursday opposing the deal, arguing that the terms don’t go far enough to address the merger’s anticompetitive harms. Among other concerns, Booker noted that the consent decree expires after only five years, leaving no protection in the sixth year.
Paramount argued that the five-year term was a reasonable outcome, given the rapidly changing nature of the film and television industry.
“Neither party knows what consumer demand will look like six years from now or how competition will evolve in the years to come in this dynamic industry,” Paramount’s lawyers wrote. “In fact, applying a longer term could hinder the combined entity’s ability to compete in the future due to changing consumer demands or new innovations, thereby undermining the antitrust laws’ goal of maintaining and enhancing competition.”
State attorneys general also defended the deal, including the five-year term length.
“The parties negotiated a five-year term,” they wrote. “This reflects a balance between preserving current levels of competition, requiring additional years of oversight, and the potential alternative of Warner Bros. seeking to merge with a different competitor.”
Booker also raised concerns about the “editorial independence council” that will be appointed to oversee the operations of CNN and CBS News. He noted that editorial issues were not part of the states’ complaint and that the board’s independence is limited, given that Paramount will appoint members.
“The Board has been structured to be as autonomous and effective as possible to ensure its independence and to avoid any claims related to governmental control of the Board,” Paramount’s lawyers wrote.
The states also argued that the commission did not raise First Amendment concerns, arguing that the agreement would not put the court in the position to rule on the new rulings.
“The Executive Order defines the structure of the Council, not its speech, and the editorial principles established by the Council will reflect private conduct,” the states argued.
Judge Araceli Martinez-Olguin last week ordered the parties to respond to Booker’s letter. The court also received amicus briefs from members of the Block the Merger coalition and the League of United Latin American Citizens, both of whom raised a series of objections to the deal.
Martinez-Olguin has not yet signed the consent decree and said last week that she would issue a decision “in due course.”
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