LOS ANGELES, July 20 (Xinhua) -- A U.S. judge ordered a temporary halt to the Paramount-Warner Bros. merger on Monday, as California and 11 other U.S. states filed a federal lawsuit last week, alleging that the deal would reduce competition in film distribution and cable television licensing.
U.S. District Judge Araceli Martinez-Olguin of the Northern District of California wrote that "the Court is persuaded that it can presume the proposed merger is likely to violate antitrust laws."
The judge's order pauses the deal for 14 days.
In February, Paramount agreed to pay 31 U.S. dollars in cash for each WBD share, valuing WBD at 81 billion dollars in equity value and at 110 billion dollars in enterprise value.
California Attorney General Rob Bonta said last week that the 12 states were "fighting for free and fair markets, not rigged markets."
"The unlawful merger of these two entertainment behemoths would lead to higher prices, lower quality, and less content for film and television, harming movie theaters, basic cable distributors, and ultimately, audiences on every sofa and movie theater seat in the U.S.," Bonta noted in a statement on July 13.
Paramount said greater scale was needed to compete with global streaming and technology companies. It said the merger would expand its content library, strengthen streaming operations and generate up to 6 billion dollars in annual cost savings.
The company also committed to releasing at least 30 theatrical films annually through the two studios. The states said such commitments would not replace competition between independently controlled companies or constitute enforceable antitrust remedies.
The U.S. Department of Justice said in June that it had closed an eight-month investigation without challenging the deal. The department said it reviewed more than 2 million documents and concluded that the merger was unlikely to harm competition in streaming, traditional television or theatrical film production and distribution. ■