Paramount CEO Threatens California Exit Over Merger Lawsuit

Paramount Skydance CEO David Ellison has threatened to begin relocating the company out of California as early as October 1 if state Attorney General Rob Bonta does not agree to negotiate a settlement in the antitrust lawsuit seeking to block Paramount's proposed merger with Warner Bros. Discovery. The move, which could also include relocating Warner Bros. if the merger closes, would mark a dramatic escalation in the legal and political battle over the $110 billion deal.

Ellison conveyed the plan to his senior executive team during a meeting on the Paramount lot last week, according to multiple sources. He stated that the company would start the process of exiting California on October 1 if settlement talks with Bonta have not commenced by that date. The Paramount Skydance board has approved the potential relocation, sources said. The October 1 date is significant because it is when Paramount will begin accruing a "ticking fee" of $7 million per day payable to Warner Bros. Discovery shareholders if the transaction has not closed by then.

The threat is aimed at pressuring Bonta, who is leading a coalition of 12 state attorneys general that filed a lawsuit on July 13 to block the...