For two days, people told me federal clearance was the finish line. This morning, Oregon walked into Multnomah County court and reminded everyone the race isn't over. If you're just joining: federal regulators cleared the Paramount Skydance–Warner Bros. Discovery deal and Warner shareholders signed off, but that didn't close the antitrust story. State AGs kept circling — California's Rob Bonta says his office still sees red flags, and California reportedly hired outside counsel for a possible merger suit. This is Paramount Skydance Watch — and today: the state that actually filed, and the analyst who finally put a name on the debt fear. I've been waiting all week for both. So let's start in Oregon, where AG Dan Rayfield stopped asking questions and started filing papers. We'll keep tracking State AG challenge threat — follow the show so the next update finds you. Okay, so the DOJ signed off, Warner shareholders voted yes — what real leverage does a state like Oregon have here, and what would they need to show a judge to stop this thing? More than people might expect. States have independent authority under their own antitrust and consumer-protection laws, so federal clearance doesn't preempt that. In Oregon's case, Attorney General Dan Rayfield filed a motion in Multnomah County court asking a judge for two things: compel Paramount Skydance to turn over documents related to its lobbying efforts around this deal, and pause the closing for 60 days while the state finishes its investigation. Per Reuters, Paramount had already told the state it wouldn't close before July 16, but Rayfield said that wasn't enough — he wants a court order. The Oregon DOJ's own release says the company 'refused to comply with state law and evading review,' which is the basis for the document motion. And per Variety, a Multnomah County judge — Judge Eric Dahlin — has already scheduled a hearing on the motion, with Paramount's lawyers telling the court they don't plan to close before July 22. That July 22 date also lines up with the EU's expected decision, so there are multiple regulatory clocks running at once. So the 60-day delay is basically for gathering evidence — does Oregon have a path to blocking the whole merger outright, or is this more about buying time? Right now, the motion is procedural: get the records, slow the close. Nobody is asking for a final block yet. But per NBC News, California's attorney general has also said publicly that the deal is, quote, 'not a done deal,' which signals that state-level antitrust challenges could follow if the investigation turns up evidence of harm to competition. Monday, I'm watching whether Judge Dahlin grants that 60-day pause. If he does, it gives states real time to build a case — and a coalition of AGs would carry a lot more weight in court than Oregon alone. Joel Leon, writing in Bloomberg Law:
The parent of CBS and other media businesses said it would buy Warner Bros. for $110 billion in late February, a deal that’s expected to close in September despite some regulatory hurdles. If the deal goes through it would create a media stock with $86 billion in gross debt, Arete’s Pierre-Marie d’Ornano said in a note to clients.
So the Arete note — and I want to be precise here — the knock goes beyond the leverage ratio. Pierre-Marie d'Ornano is saying management may not have the experience to run an $86 billion gross-debt stack. He's questioning execution, not just the balance sheet. Right, and that distinction sharpens the whole thing. The issue is who's expected to service that debt, not the number sitting there by itself. When a sell-side analyst puts a sell rating behind it, the concern gets an institutional voice it didn't have this week. And look at the timing. $110 billion deal, September close, and now a public downgrade aimed right at debt-service capacity. If I'm a state AG building a preliminary-injunction record, that Arete note is exactly the kind of thing my expert witness pulls into the hearing. That's the piece people aren't connecting tightly enough. Every week the close slips, the ticking fee compounds against a company an analyst now says may not be able to carry the debt. Those delays come with a price, and the cost piles up right where Arete just pointed. Got thoughts on today’s Paramount Skydance Watch, a story we should follow, or a correction? Send us a note at paramountskydancewatch at lantern podcasts dot com.
What we’re watching next: Judge Eric Dahlin’s scheduled hearing on Oregon’s motion for documents and a 60-day closing pause, and the EU’s expected July 22 decision on the Paramount-Warner Bros. Discovery deal.
You’ll find links to every story we covered in the show notes, if you want to dig further into any of them. That’s Paramount Skydance Watch for today. This is a Lantern Podcast.