The Writers Guild of America has filed a lawsuit seeking to block Paramount's proposed $110-billion acquisition of Warner Bros Discovery, arguing that the merger would reduce competition in Hollywood and negatively affect writers' employment opportunities and earnings, according to reports.
The WGA, which represents around 18,000 members through the Writers Guild of America West and Writers Guild of America East, said the merger would unlawfully concentrate demand for writers in the entertainment industry, Reuters reported.
Filed in a San Francisco federal court on Tuesday, the lawsuit claims that combining two of Hollywood's biggest studios would leave writers with fewer buyers for film and television projects, weakening their bargaining power and reducing wages, the report stated.
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The Writers Guild's legal action comes just a day after California and 11 other US states filed a separate lawsuit to stop the proposed acquisition. Led by California Attorney General Rob Bonta, the states argue that the merger would reduce competition in film distribution and basic cable television, giving the combined company excessive market power.
According to the multistate lawsuit, the merged entity would control approximately 27% of the US film distribution market, nearly 30% of blockbuster film distribution, and about 27% of the basic cable television market. The states contend that such market concentration could affect movie theatres, pay-TV distributors and consumers.
Although the US Department of Justice has already cleared the merger on antitrust grounds, the lawsuits are expected to extend the legal process. Paramount has claimed that prolonged litigation could delay the transaction, increase costs, create uncertainty around its financing plans and affect the company's share price.
Paramount Skydance CEO David Ellison had previously claimed that the merged company plans to release around 30 films annually, with each title receiving an exclusive 45-day theatrical window before moving to other platforms.
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