New antitrust litigation funding in Gavin Newsom‘s final budget as California’s governor looks to provide a clue as to what the state plans to do about the contentious Paramount-Warner Bros Discovery merger.
The just-released revised budget may be unexpectedly tax-revenue flush, but the likely 2028 White House candidate isn’t exiting Sacramento without firing off a multimillion-dollar antitrust salvo to corporate America and consolidating Hollywood.
Message: Get ready to rumble!
“In response to the federal government’s recent retreat from enforcing antitrust laws, the May Revision includes $14.3 million Special Funds in 2026-27, declining to $10.5 million in 2029-30, to address an anticipated increase in antitrust workload,” reads Newsom’s May Revision budget summary released Thursday.
“The lack of federal oversight in this area leaves California individuals and businesses vulnerable to predatory business practices that threaten affordability and consumer rights,” the 105-page document adds. “California has been a leader in this area, most recently dedicating $8 million annually since the 2023 Budget Act, specifically to prosecute antitrust violations in the gas and oil, technology, and agricultural sectors. These resources allow DOJ to conduct independent investigations and litigation and to enforce California’s antitrust laws in these sectors of the economy.”
If you have any doubts what Newsom is talking about here, just ask the executives at Paramount and Warner Bros Discovery if they’ve talked to the brass at Live Nation and Nexstar-Tegna lately. The latter wouldn’t be lying if they told the companies led by David Ellison and David Zaslav that Golden State Attorney General Rob Bonta is loaded for bear.
Loaded, and on a roll of late.
Having successfully led Blue State efforts to have live entertainment giant Live Nation labeled a monopoly last month, Bonta was also pivotal in recently halting the already-in-motion Nexstar-Tegna merger as well. On a parallel track, as Live Nation preps an appeal and Nexstar vows a fight, the re-election-seeking Bonta has an self-styled antitrust “active investigation” underway into Donald Trump‘s “good friend” Ellison’s $111 billion acquisition of WBD.
No decision has been made yet as to what that Paramount-WBD probe might conclude and where it could go, sources tell me.
For the record, the CA DOJ draws much of its antitrust funding for investigations and litigation from its Antitrust Accounts, where portions of past settlements and awards are deposited. The announcement Thursday of additional resources in the revised budget would be in addition to those accounts.
In the background of the Paramount-WBD probe, Ellison and Newsom have met privately at least once in L.A. In the public arena, a variety of A-list-packed petitions against ParaBros have widely circulated, and a few lawsuits have been filed.
“It’s not a done deal,” Bonta told Deadline back in March.
Last week, likely sensing which way the legal wind is blowing, Paramount Skydance’s chief legal officer Makan Delrahim wrote to Bonta to preemptively plead the company’s case. “To compete more effectively with Netflix, and others leading services, a combined Paramount-WBD will need to capture audiences’ attention in fresh ways, and that includes broadening theatrical distribution to tap into the magic of the moviegoing experience and create momentum behind films before they reach streaming services,” the ex-Trump administration antitrust guru told the California AG.
This spring, Bonta laid out where he and other states were on the merger: “The regulatory hurdles have not been crossed by the deal yet. We have an investigation that’s open and ongoing, and we are looking at the deal. Whenever there’s major corporate consolidation like this, there’s a concern that we might see increased prices, lower wages, reduction in competition, limits in choice, lower quality, all those things. That’s why there is antitrust law in the first place. That’s why there’s regulators like my office that care and will look and be objective and fair, thorough and comprehensive in our review and come to a conclusion.”
Spreading the wealth strategically, Newsom’s self-declared “fiscally disciplined, balanced” budget released today estimates that state has brought revenues $16.5 billion higher than anticipated just a few months ago. That will pay for a lot of antitrust lawyers, among other things.
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