DOJ Leadership Cleared Paramount-Warner Deal Over Staff Objections

The Justice Department's senior leadership shut down an antitrust investigation into Paramount's acquisition of Warner Bros. Discovery before career investigators had a chance to formally recommend challenging it — an unusual procedural short-circuit that has rattled the agency's antitrust division. The career lawyers, who had spent months examining the deal, were leaning toward recommending a lawsuit on the grounds that merging the two major movie studios would be anticompetitive. They were informed on a Friday that the investigation was being closed, effectively greenlighting the deal at the federal level.

Senior DOJ leaders were reportedly swayed by a two-hour interview with Paramount CEO David Ellison — son of Oracle founder and Trump ally Larry Ellison — conducted last month. Leadership concluded that Ellison persuasively answered staff concerns, including how the combined company could honor a commitment to release 30 theatrical films per year given the significant debt it would carry post-merger. Leadership did not view the debt burden as legal grounds to block the deal. Notably, no member of the investigative team broke ranks to advocate for filing suit.

The DOJ went further than simply closing the probe — it issued an unusually supportive public statement arguing the merger would likely benefit competition, particularly in streaming, where Netflix and Amazon dominate. Some career staffers believe that statement was deliberately crafted to complicate potential legal challenges by state attorneys general. Critically, the investigative staff played no role in drafting it. California AG Rob Bonta has been reviewing the deal and is reportedly leaning toward challenging it in court.

Paramount, which announced its bid for Warner Discovery in February — beating out Netflix in a monthslong contest — controls the combined entity that would bring together HBO, CNN, Harry Potter, and major studio assets. Paramount executives are reportedly preparing employees for a potential close as early as the end of July, with European regulatory review still ongoing.

The episode fits a pattern in the current administration: antitrust career staff feeling overruled or sidelined. The most striking precedent is the DOJ's March decision to settle its long-running monopoly case against Live Nation mid-trial. State AGs who kept litigating that case ultimately won — a result that may embolden Bonta and others to push forward on the Paramount deal regardless of Washington's blessing.