12 states, WGA face $1.88B bond request in Paramount-Warner merger fight

Bond would cover $7 million-a-day ticking fee if deal misses Oct. 1 close

The Wall Street Journal reported Monday that Paramount asked a judge to require 12 states and the Writers Guild of America to post a nearly $1.88 billion bond to continue their legal challenge to the company’s $81 billion acquisition of Warner Bros. Discovery. The bond would cover a $7 million-a-day ticking fee Paramount will owe Warner shareholders if the deal does not close by Oct. 1.

Under Paramount’s proposal, the company would receive the bond funds if it beats the challengers in court. The motion is an attempt by the media company to hold plaintiffs financially responsible for monetary damages it says it will suffer during litigation aimed at blocking the merger.

The $7 million-a-day fee, which amounts to roughly $650 million per quarter, was an incentive Paramount offered to persuade Warner shareholders to choose its bid over rival suitor Netflix, the Journal reported. The ticking fee would continue to accrue if the deal does not close by the October deadline.

Paramount said in the motion that it will have incurred $1.3 billion in unrecoverable financial losses from ticking fees by the time post-trial briefing concludes, “to say nothing of incremental financing fees and delayed synergies.” The motion frames the bond as necessary to protect the company from litigation costs while the case proceeds.

A trial is scheduled for March 2027, much later than Paramount had sought. The company also said in its court filing that because the trial does not start until next year, it will be “forced to restart the regulatory-approval process in certain jurisdictions—including the United States, whose approval expires on February 19, 2027—thereby incurring additional expenses and delay.”

Paramount is relying on two different legal authorities to argue that requiring the bond is necessary, the Journal reported. The motion does not specify which authorities the company is invoking.

The 12 states and the Writers Guild of America are the plaintiffs in a lawsuit that seeks to block Paramount’s $81 billion acquisition of Warner Bros. Discovery. The specific claims in the underlying case were not detailed in the Journal’s Monday report, which focused on Paramount’s bond request.

The bond request is the latest development in the legal challenge to the $81 billion merger. The trial in the case is scheduled for March 2027, and U.S. regulatory approval for the deal expires February 19, 2027.