U.S. Merger Approval a Big Win for the Companies, But No Longer the Final Word
The Justice Department may have cleared the Paramount–Skydance–Warner Bros. Discovery transaction without conditions, but today that no longer ends examination of a deal’s antitrust implications. State attorneys general are reportedly preparing suit, enforcers in the United Kingdom and European Union have active review processes underway, and consumers have joined the conversation as well.
DOJ approval is now one milestone – albeit a significant one – but it does not have the final decision. In major transactions like this one, with international market implications, states and a small number of global regulators can still shape the timing, structure, and fate of the deal. Also, threshold questions are not limited to market share analysis, but extend to labor markets, bargaining power over – in this case – creative talent, and control over distribution and information channels. Read our previous post.
DOJ Clears Deal Without Remedies
In declining to challenge the merger, the DOJ Antitrust Division concluded it is not likely to harm competition in streaming, television, or film markets. The agency imposed no divestitures or behavioral conditions.
Paramount views the decision as confirmation that the combined company will better compete with large technology platforms which greatly influence the media ecosystem.
Update June 16, 2026: According to The Wall Street Journal, DOJ leadership moved to clear the deal before career staff could finalize their recommendation—despite internal momentum toward a lawsuit—after a two-hour interview in which Paramount CEO David Ellison addressed concerns about the merger’s viability and competitive effects.
State Attorneys General: Can They Be Effective?
The most immediate challenge to the merger now comes a coalition of attorneys general—led by California—which is reportedly preparing litigation and has emphasized that the transaction “is not a done deal.”
State enforcers are increasingly willing to act independently of federal enforcers. Whether they can be effective in prosecuting antitrust cases is another question, however, for their track record in standalone merger litigation is limited. Historically, states have acted in conjunction with the DOJ or the Federal Trade Commission. State-led merger challenges, while increasingly common, are not a sure bet and lack a lengthy record of sustained success.
Part of the reason is structural. Antitrust merger litigation is resource-intensive and economically complex, and even federal enforcers have struggled to meet the courts’ evidentiary standards in difficult cases. At the same time, states have achieved important wins in coordinated actions and in conduct cases, and recent decisions, including state-level challenges to major retail mergers, suggest that their role is continuing to evolve. The result is a growing but uneven record in merger enforcement.
UK CMA Review: Formal Process Now Controls Timing
At the same time, the transaction faces a formal merger review in the United Kingdom that may determine the outcome.
On June 9, 2026, the Competition and Markets Authority issued a notice under Section 96(2A) of the Enterprise Act 2002, formally triggering its statutory review. Phase 1 began June 10, 2026. The Authority must decide by August 7, 2026, whether to clear the deal or refer it to Phase 2. At that point, the agency must determine whether there is a “realistic prospect of a substantial lessening of competition.”
For a deal targeting near-term closing, the CMA has become a central gatekeeper, not simply an additional reviewer. For example, in 2020 a U.S. federal court rejected the DOJ’s effort to block the Sabre/Farelogix. But two days later the CMA prohibited it. The parties then abandoned the merger.
European Commission: Review on Two Tracks
The European Commission is conducting parallel reviews: A merger review under traditional competition rules and a Foreign Subsidies Regulation inquiry focused on sovereign wealth fund financing. Near-term deadlines in these reviews introduce both timing risk and the possibility of remedies.
The EC competition law enforcers demonstrated years ago, as the CMA did more recently, that U.S. approval does not always resolve competition issues raised in a cross‑border merger.
The proposed $45 billion merger between General Electric and Honeywell in 2001 would have combined major suppliers of aircraft engines, avionics, and other aerospace systems. The DOJ approved the deal with limited conditions, concluding that existing competition and efficiencies mitigated antitrust concerns. The European Commission, however, found otherwise and blocked the transaction outright. European enforcers focused on the risk that the combined firm could leverage its position across adjacent product lines—particularly through bundling and vertical integration—to disadvantage rivals in ways not reflected in prevailing U.S. analysis at the time. Facing an outright prohibition in Europe, GE abandoned the merger rather than attempt to restructure it.
Are Other Nations Approving the Merger?
As is the case with such a far-reaching corporation, the merger landed on the desks of other global agencies. Canada’s Competition Bureau remains in review, without a publicly announced position. Authorities in Australia and New Zealand have cleared the deal, concluding that the merger is unlikely to substantially lessen competition, even while eliminating direct rivalry between the parties. Approvals have also been obtained in Saudi Arabia, Ukraine, Serbia, and North Macedonia, along with foreign investment clearances in multiple European countries.
Why This Deal Is Different
From the outset, the Paramount–Warner transaction has raised issues that extend beyond price effects. In addition to concerns over creative labor markets, buying power over content creators, and control over distribution pipelines, consolidation of major news platforms, particularly CBS News and CNN, has raised eyebrows in a politically charged environment where media organizations have been characterized as unfair critics of the Trump Administration.
Editorial independence, particularly given the broadcast licensing power of the government, could be lost, critics say. Also of concern is the friendly relationship between Larry Ellison, founder of Oracle, his son, Paramount Skydance CEO David Ellison (the senior Ellison is financial backer and advisor to the media company), and President Trump, who routinely calls out CNN and CBS News for biased coverage of his administration. (Concerns about the president’s relationship with the Ellisons would heat up after the Wall Street Journal reported on David Ellison’s meeting with DOJ officials.)
Many commentators believe Trump’s criticism of Late Show host Stephen Colbert for his constant ridicule of the president not only ended Colbert’s contract, but the long-running CBS show itself.
What They Are Saying: Economists and Antitrust Commentators
Beyond media industry concerns, though, a growing body of antitrust scholarship helps explain why transactions like this are under heightened scrutiny.
Labor economist Ioana Marinescu has helped frame concerns about labor-market concentration and reduced competition for workers, while legal scholar Eric Posner has argued that antitrust analysis should take employer market power more seriously.
Former FTC Chair Lina Khan emphasized during her tenure that merger review should account for labor-market effects and other modern competitive realities beyond short-term price effects.
Antitrust economists including Fiona Scott Morton and Carl Shapiro have long argued that merger analysis must examine market structure, bargaining leverage, and control over key inputs and distribution channels, not just immediate consumer pricing.
Private Litigation: Early but Not Insignificant
Still, prices certainly concern consumers. In April, a group of streaming subscribers filed suit in federal court seeking to block the merger under Section 7 of the Clayton Act, alleging that the deal would increase prices and reduce production. They share the concerns of the economists that the deal would concentrate control over national news and entertainment markets.
Paramount has moved to dismiss the complaint, arguing that the claims are speculative and fail to establish cognizable antitrust harm. Private merger challenges rarely succeed in blocking transactions, but they can create discovery risks and delay closings.
When Antitrust Enforcers Disagree
In practice, companies cannot realistically segment global operations by jurisdiction. When a major regulator objects, the parties face a set of constrained options: accept remedies that may fundamentally reshape the transaction, proceed without access to key markets, or abandon the deal altogether.
Even short of a formal prohibition, extended investigations or demands for structural concessions can alter the economics of a deal or delay closing long enough to derail it. For that reason, merger outcomes often turn not on any single approval, but on whether the parties can secure alignment among a small number of key antitrust authorities with overlapping, but not identical, legal frameworks and policy concerns. As we have explained, the fate of the deal could be in the hands of European authorities, but the companies are right to enjoy, for now, federal approval from Washington.
Edited by Tom Hagy, Editor-in-Chief, Mogin Law Blog
Takeaways
- DOJ approval – a big win for the companies – no longer quiets competitive concerns in cross-border mergers.
- Formidable UK and EU enforcers can control deal timing and outcomes, as history has shown.
- State attorneys general are increasingly active in merger cases, though their record is relatively thin.
- The weight of agency analysis is tilting toward the effects on labor markets, bargaining power, and control over information.
- Price is still a key factor for consumers, which they made clear in a private suit to stop the deal.
If you have questions about the effects of a merger or anticompetitive conduct, contact us at Info@MoginLawLLP.com.
Members of the press are encouraged to contact us at Media@MoginLawLLP.com.
Mogin Law Attorneys
Kristy Greenberg, Senior Attorney
FAQ
No. DOJ clearance is important, but it does not foreclose review by state attorneys general, the UK Competition and Markets Authority, the European Commission, or private plaintiffs. For business attorneys, the practical lesson is that federal approval may reduce one category of risk while leaving timing, remedy, and closing risk very much alive in other jurisdictions.
The parties may be forced to accept structural or behavioral remedies, delay closing, carve out operations, or abandon the transaction altogether. In practice, companies cannot always operate major media or technology businesses as though one jurisdiction does not matter, so a single adverse decision from a major regulator can reshape the economics of the deal.
They should treat state enforcement as a real parallel risk, not an afterthought. That means building a record early on labor effects, supplier relationships, competitive alternatives, and local market impact, while also stress-testing the transaction timeline for possible litigation, investigative demands, and political scrutiny outside Washington.
Increasingly, enforcers are examining labor-market concentration, bargaining power over suppliers or creative talent, control over distribution channels, and the ability to influence information or access. For counsel, that means merger analysis should not stop with consumer pricing models; it should also examine how the combined firm could affect workers, counterparties, and strategic chokepoints in the market.
You should contact a qualified competition law firm that has experience with these types of matters. Getting a high-level assessment of whether you have a potentially actionable antitrust case is a good business practice. Contact Mogin Law LLP if you would like to schedule a consultation.