Paramount Shareholder Sues Ellisons Over Alleged Trump Deal to Secure Warner Bros. Merger
Courtesy of Gilbert Flores.
Paramount Skydance chief David Ellison and his billionaire father, Larry Ellison, have been sued by a Paramount shareholder who alleges they struck an “illegal” deal with President Donald Trump to secure federal approval for the company’s $111 billion takeover of Warner Bros. Discovery.
The lawsuit, filed Tuesday in Delaware Chancery Court by shareholder Paul Robbins, seeks to block the merger and obtain unspecified damages. It claims the Ellisons offered Trump private benefits in exchange for removing regulatory obstacles, including the potential settlement of his legal claims against CNN and promises to fire anchors he dislikes after the takeover.
The complaint argues that the alleged arrangement could damage Paramount’s news brands and expose the company to scrutiny from future administrations.
The lawsuit follows separate attempts to stop the merger from 12 Democratic state attorneys general, who allege the deal would reduce competition in theatrical film and cable television, and the Writers Guild of America, which says it would harm writers’ pay and employment opportunities.
Paramount rejected the allegations, saying no commitments had been made to any government body regarding CNN or its other news properties. The company said the merger would increase consumer choice, strengthen investment in original programming and create a more competitive streaming business.
Trump is not named as a defendant, while representatives for Oracle and the White House did not immediately comment.
The Justice Department approved the Paramount-WBD deal in mid-June without requiring divestitures or concessions. The lawsuit claims senior officials cleared the transaction despite objections from lower-ranking lawyers who were reportedly prepared to challenge it.
The complaint also questions why the deal has apparently avoided review by the Committee on Foreign Investment in the United States, despite receiving $24 billion from sovereign wealth funds in Saudi Arabia, Qatar and the United Arab Emirates. Those investors are expected to own 38.5% of the combined company, although Paramount says they will not receive board seats or voting shares.
Robbins’ lawsuit alleges that the Ellisons and Paramount’s board breached their fiduciary duties by pursuing a merger that could allow company leaders to benefit from unlawful conduct.
Alongside David and Larry Ellison, the defendants include Paramount board members Gerry Cardinale, Safra Catz, Andrew Brandon-Gordon, Paul Marinelli, John Thornton, Barbara Byrne, Andrew Campion, Justin Hamill and Sherry Lansing.
TRENDING NEWS