Judge pauses $110bn Paramount-Warner Bros. deal

A federal judge has temporarily halted the proposed $110 billion takeover of Warner Bros. by Paramount, imposing a short-term block on closing the transaction. U.S. District Judge Araceli Martínez-Olguín issued a temporary restraining order that prevents the companies from completing the deal while the court evaluates an antitrust challenge. The order marks a significant procedural step in the legal review of one of the largest proposed transactions in the entertainment industry.

The temporary restraining order arose from an emergency motion that asked the court to prevent the merger from closing while a broader request for a preliminary injunction is considered. By granting the temporary relief, the judge has preserved the status quo and ensured the deal cannot close immediately while arguments over competition and market impact are further examined.

The emergency motion that prompted the restraining order was filed by a coalition of 12 state attorneys general. The group is led by California Attorney General Rob Bonta, who is spearheading the multistate effort to challenge the transaction on antitrust grounds. The coalition contends that the combination of Paramount and Warner Bros. could harm competition, particularly in areas such as theatrical distribution and basic cable.

By seeking a preliminary injunction, the states aim to secure a longer-term court order that would block the deal from closing until the underlying antitrust lawsuit is resolved on the merits. The temporary restraining order is a first step in that process, providing time for the court to consider the more extensive injunction request.

The temporary restraining order will remain in place for up to 28 days while the court weighs the preliminary injunction request. During this period, Paramount and Warner Bros. are barred from closing the transaction. The court has indicated that a written ruling on the emergency motion will be issued by Wednesday, July 22, 2026, providing a defined near-term timetable for the next decision point.

In the proceedings, Paramount represented that it would not close the transaction before July 22. The company also offered to stipulate that it would refrain from closing for roughly 28–30 days while the court considers the injunction. This representation aligns with the court-ordered pause and underscores that the merger will remain on hold at least through the initial review period.

The merger agreement includes financial provisions that raise the stakes if closing is delayed beyond certain dates. If the transaction has not closed by September 30, Paramount could become liable for roughly $7 million per day payable to Warner Bros. Discovery shareholders. This daily obligation would apply until the deal closes, adding substantial cost to a prolonged delay.

The possibility of these payments underscores how the legal timetable may intersect with the deal’s economics. The combination of the temporary restraining order, the pending preliminary injunction request, and the contractual deadline creates uncertainty around when, or if, the transaction will be completed and at what financial cost to Paramount.