Paramount threat to leave California is blackmail, AG says

California Attorney General Rob Bonta accused Paramount of "blackmail" Tuesday over a reported threat to move the company out of the state unless lawsuits seeking to stop its $110 billion merger with Warner Bros. are settled.

A dozen US states have launched legal action to block the deal, arguing it would reduce competition in the movie industry and lead to job cuts. Bonta said the merger would result in higher costs, fewer options and fewer people making movies.

Trade media reported that Paramount Skydance chief David Ellison told senior executives he would start moving the company on October 1 if Bonta does not negotiate a settlement. Paramount did not immediately respond to AFP requests for comment.

October 1 is the date when a $7 million-a-day fee begins accruing for Warner Bros. Discovery shareholders if the merger has not closed. Variety, citing insiders, reported that Ellison had drawn up a five-year plan to move the company from California, starting with its Los Angeles headquarters.

Any exit from Southern California, the center of the US movie industry, would likely prompt resignations from workers unwilling to relocate.

The dispute comes days after Britain approved the takeover, removing a major international hurdle. The deal already has approval from the US federal government and the European Union. If completed, the combined company would control assets including CNN, Warner Bros. Pictures and the HBO Max streaming service.