UPDATE 5-California cancels talks with Paramount over Warner Bros deal

California Attorney ​General Rob Bonta canceled a meeting with Paramount Skydance representatives scheduled ​for Monday to begin settlement talks over the ‌state's ​lawsuit seeking to block Paramount's proposed $110 billion acquisition of Warner Bros Discovery, his office said. Paramount has pushed for a settlement in the case, which is the last hurdle to the deal ‌along with a parallel lawsuit by the Writer's Guild of America. The company faces a mountain of fees and costs to keep the deal together if the lawsuit continues to a trial scheduled for March. Bonta and his partner states have so far won key rulings, ‌giving them leverage if settlement talks continue. Bonta accused Paramount of leaking details of a meeting held on Friday and acting in ‌bad faith, a claim Paramount has denied.

"Not only did Paramount leak the alleged substance of settlement discussions, but they misrepresented these discussions, demonstrating a lack of good faith," Bonta said, adding his office met with Paramount on Friday. "As soon as Paramount stops playing games and engages sincerely, my office is happy to meet again," Bonta ⁠added. A ​Paramount spokesperson said the company shares "Bonta’s concerns ⁠about the public discussions and misreporting that has surrounded this deal."

"As we have assured the Attorney General’s office, Paramount has not been the source of the ⁠leaks of any of our confidential discussions with the AG’s office. We remain hopeful and stand ready to continue good faith discussions to resolve the Attorneys ​General suit and move forward with our plans for increased competition and increased output to the benefit of the talent ⁠and entertainment workers,” the spokesperson said. Bonta has repeatedly indicated an openness to settling cases generally. But he has also said that structural remedies, which could include selling ⁠off ​part of a business, are better than companies promising to take actions. Paramount Skydance CEO David Ellison has promised to release 30 movies per year and to keep them exclusively in theaters for 45 days. California and 11 states sued on July 13, arguing ⁠the deal would create a media behemoth with the power to raise prices in film and television.

The Wall Street Journal reported on ⁠Sunday that Bonta planned to ask ⁠Paramount to divest some cable channels and commit to keeping its movie studio separate from Warner Bros before he signs off on their merger, citing people familiar with the matter.