Paramount is negotiating with California to resolve legal hurdles in its push to acquire Warner Bros. Discovery. One potential condition for settlement is a commitment to release at least 30 films annually in theaters after the deal closes; failing to meet this target could result in a $30 million fine for each missing film.
Two individuals familiar with the negotiations revealed these terms but requested anonymity because the discussions are not yet public. One source also mentioned that if Paramount fails to fulfill its commitments, it might need to sell its stake in Miramax. However, these proposals are still under negotiation and have not been finalized into an agreement.
The commitment to release 30 theatrical films per year is not a new proposal. Paramount had previously offered this pledge to secure support from major theater chains for the transaction. The films used to meet this quota do not necessarily have to be produced by Paramount itself; the company could make up the numbers by distributing works produced by other studios.
The acquisition is valued at approximately $110 billion. California, along with eleven other states and the Writers Guild of America, has raised objections to the deal. The lawsuits argue that the merger of two major media conglomerates could give the new company an excessive share of the film and television markets.
Recent settlement discussions have accelerated, with several potential concessions on the table. The proposals include investing approximately $1.5 billion in California's film and television production sector, committing to retain Paramount's studios in the state, and selling off certain cable networks. Establishing mechanisms to oversee CNN's editorial independence is also under discussion.
A spokesperson for the California Attorney General's Office stated that the potential settlement negotiations are confidential, so they could neither confirm nor deny whether talks are ongoing, nor respond to the reported terms. Paramount also declined to comment on the details of the negotiations.
The focus on theatrical release commitments stems from concerns about market concentration and film distribution methods. California Attorney General Rob Bonta had previously expressed opposition to similar commitments, citing difficulties in enforcement. Currently, the $30 million per-film penalty, the potential sale of Miramax shares, and other conditions have not been finalized, and negotiations are ongoing.