Paramount Skydance fired back at Netflix in a letter to the U.S. Department of Justice this week, accusing the streaming giant of waging a “scorched-earth campaign” to sabotage its $110 billion merger with Warner Bros. Discovery — while also dismissing labor concerns raised by the International Brotherhood of Teamsters about the deal’s impact on Hollywood workers.
Makan Delrahim, Paramount’s chief legal officer, addressed the letter to DOJ officials Jared A. Hughes and A. Maya Khan, claiming Netflix’s response to the deal amounted to a “panic-level” reaction that revealed just how seriously the streamer viewed David Ellison’s company as a scaled competitor. Delrahim, who served as the DOJ’s top antitrust regulator during President Trump’s first term, argued that Netflix was actively trying to poison regulators against the transaction.
The letter was a direct response to a March report filed by the Teamsters, in which the union argued to the DOJ that the proposed merger posed “a direct threat to film and television workers nationwide.” The 1.3-million-member union, which represents nearly 15,000 rank-and-file Motion Picture Teamsters, urged the DOJ’s Antitrust Division to block the deal entirely unless substantial and enforceable safeguards were put in place to protect domestic production and jobs.
The Teamsters warned that the deal would consolidate two of Hollywood’s five major studios and combine the HBO Max and Paramount+ streaming platforms, further concentrating decision-making power in an already top-heavy industry. The union pointed to Disney’s 2019 acquisition of 20th Century Fox as a cautionary precedent, noting it produced significant layoffs and project cancellations.
Paramount’s response was blunt. Delrahim wrote that the merger would not reduce work opportunities for the Teamsters or other organized labor groups. The company argued that a stronger, more efficient combined entity would increase content investment, spur competition, and force rivals — including Netflix, Amazon MGM, Disney, Universal, Sony, Apple, A24, and Lionsgate — to respond by expanding their own production slates.
The DOJ letter is only one front in a widening regulatory battle. A group of state attorneys general are reportedly preparing to file a lawsuit to block the deal as soon as this month. California Attorney General Rob Bonta, who is actively investigating the merger, previously said “red flags are everywhere” with a transaction of this scale and that states stood ready to act — though his office declined to offer specifics on timing.
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The transaction, unanimously approved by both companies’ boards, is structured as a $31-per-share cash offer for all outstanding WBD shares and is targeted to close in Q3 2026, subject to regulatory clearances and WBD shareholder approval. The clock is ticking: if the deal has not closed by September 30, WBD shareholders are entitled to a quarterly ticking fee of $0.25 per share until it does.
