The Scoop
Congressional Democrats are sending a message to the Justice and Treasury departments: We are going to check your work on Paramount’s acquisition of Warner Bros. Discovery.
In a letter to Attorney General Pam Bondi and Treasury Secretary Scott Bessent, a dozen House Democrats and Sens. Elizabeth Warren, D-Mass., and Richard Blumenthal, D-Conn., said they wanted more information about the ongoing federal review of Paramount’s acquisition of WBD. They suggested that it could be in violation of federal antitrust laws and restrictions on foreign ownership of crucial US businesses.
“Congress has a responsibility to ensure that merger enforcement in concentrated creative industries — particularly transactions involving substantial foreign capital — is conducted rigorously and in strict adherence to federal law,” the letter said.
The letter, which was signed by Reps. Sam Liccardo, D-Calif., Zoe Lofgren, D-Calif., Dan Goldman, D-N.Y., and Sarah McBride, D-Del., among others, said that the deal raises “substantial concerns” under Section 7 of the Clayton Act, which prohibits anticompetitive mergers. The letter said the deal contained “significant horizontal and vertical overlap in theatrical distribution, premium streaming, and first-window licensing markets, and would likely reduce competition among studios for movies.”
The letter also raised concerns about foreign investment in Paramount’s offer, noting that the deal included potential financing from Chinese company Tencent Holdings, which had previously withdrawn funding due to national security review concerns. The Democrats also raised concerns about backing from the United Arab Emirates, Qatar, and the Saudi Public Investment Fund, including the detail that the fund is controlled by Crown Prince Mohammed bin Salman, who ordered the killing of Washington Post journalist Jamal Khashoggi.
The lawmakers asked for more details on whether the WBD-Paramount deal could be subject to review by the Committee on Foreign Investment in the US, as well as “whether any governance rights, board representation, or access to non-public information were granted to foreign investors and reviewed for national security implications,” the letter read. The Democrats also requested that both DOJ and Treasury preserve records related to the transaction.
Max’s view
Over the last year, Paramount owner David Ellison and his billionaire father, Larry Ellison, navigated President Donald Trump’s Washington by signaling that, unlike more skittish Hollywood players, they were willing to make nice.
Ellison bought the anti-woke, pro-Israel Free Press and installed its founder atop CBS News with a mandate to shake up the network. When Trump wanted a new Rush Hour film made by his friend Brett Ratner, Ellison jumped to make it happen.
As the Ellison family has telegraphed its more friendly attitude towards Trump, Democrats have gotten the message, too.
Thursday’s letter is just the latest warning Democrats and their allies have sent about WBD’s acquisition by Paramount and what it could mean for corporate media control in the US.
On Tuesday, Status reported that Warren and Blumenthal had also expressed serious concerns about Tencent’s role in Paramount’s deal. Sen. Bernie Sanders, I-Vt., posted on Wednesday a list of the media properties that would be controlled by Paramount if the WBD merger is approved. And last week, a group of left-leaning and progressive groups sent a letter to state attorneys general calling on them to block the merger.
Democrats remain out of power and, beyond letter-writing, have limited options for opposing a media deal that would make Ellison one of the biggest players in American media. Many antitrust experts privately concede it would be difficult for states to scuttle a deal that clears federal approval.
But some in the party, should it retake power, are hellbent on punishing companies that were too friendly to Trump. In a previous letter first reported by Semafor late last year, Liccardo and Rep. Ayanna Pressley said so almost explicitly, writing that “future Congresses … will review many of the decisions of the current Administration, and may recommend that regulators push for divestitures, which would undermine the strategic logic of this merger.”