The Writers Guild of America has strongly criticized Paramount Skydance CEO David Ellison following his recent threat to remove the studio from California. The guild issued a statement responding to Ellison’s warning that he would pull the company out of the state unless California Attorney General Rob Bonta agrees to settle an ongoing antitrust lawsuit aimed at blocking the planned merger with Warner Bros. Discovery.
WGA Condemns Paramount CEO’s Relocation Threat
By threatening to leave the state because it doesn’t want the government to enforce the law, Paramount further proves the danger of its outsized power over the industry and what that will mean for writers and the creative community,
the guild stated, adding that This type of behavior is precisely why the merger should be blocked.
The WGA is actively pursuing its own legal action against the transaction. Filed jointly by the WGA East and West in the Northern District of California, the union’s lawsuit seeks to halt the $110 billion acquisition. The writers’ organization chose to bring an independent case rather than join Bonta and a coalition of 12 state attorneys general in order to address specific labor concerns not covered by the state officials’ action.
Antitrust Lawsuits and Trial Schedule
The state attorneys general lawsuit and the Writers Guild of America case have been assigned to the same judge, Araceli Martinez-Olguin. The federal antitrust trial is scheduled to take place from March 2 to March 19, 2027.
Attorney General Rob Bonta has publicly dismissed Ellison’s relocation warnings, describing the tactic as another attempt to blackmail the state into letting an illegal deal through.
Bonta has indicated an openness to negotiating structural remedies, such as divestments, but rejected behavioral commitments like promises to release a specific number of films annually.
Ellison informed his senior leadership team that the Paramount Skydance board approved the potential relocation. Under the current timeline, if Bonta does not negotiate a settlement, the studio plans to begin moving operations out of California starting October 1.
Financial Pressures and Ticking Fees
The urgency behind Variety’s push for a swift resolution relates directly to the financial terms of the Warner Bros. Discovery transaction. Paramount agreed to a ticking fee that requires the company to pay $7 million per day to WBD shareholders starting October 1 if the transaction has not closed.
Because the trial is set to conclude in March 2027, the company faces approximately $1.2 billion in accrued ticking fees by the time proceedings wrap up. If the merger ultimately fails, Paramount remains responsible for a $7 billion breakup fee to Warner Bros. Discovery.
To mitigate these escalating costs, Ellison outlined a plan to relocate the company’s Los Angeles headquarters and shift most studio jobs out of California over a five-year period. Potential destinations under consideration include Georgia, Texas, and Tennessee.
Industry Opposition and Broader Legal Challenges
Beyond the state attorneys general and the WGA, the merger has encountered multiple obstacles across the entertainment sector. Paramount investors filed a separate lawsuit in Delaware Chancery Court against David Ellison and Larry Ellison regarding alleged side deals connected to the merger.
The WGA maintains that the combined entity would control more than 30% of wide-release big-budget theatrical films and reduce competition for working writers pitching screenplays and television projects. While regulatory bodies in dozens of countries—including the European Union, China, Canada, and Australia, alongside the U.S. Department of Justice—have reviewed the transaction, the ongoing domestic antitrust litigation continues to delay its completion.
