EXCLUSIVE — Arizona Republican Senate President Warren Petersen is calling for a public hearing on the potential cost that state taxpayers may have to bear if a court grants Paramount Skydance‘s $1.88 billion bond request in its legal battle against a multistate antitrust lawsuit.
Earlier this week, Paramount filed a motion seeking the hefty bond that would cover the company’s financial losses from an injunction blocking its pending merger with Warner Bros. Discovery. Twelve blue states, led by California, and the Writers Guild of America would be on the hook financially if the bond is granted by a federal judge. The bond will be paid to Paramount should it win the antitrust case. Arizona is one of the plaintiffs suing to halt the merger.
Petersen criticized Arizona Attorney General Kris Mayes, whom he is running to replace, for joining the lawsuit and potentially putting taxpayer money at risk.
“Protecting consumers should never mean handing taxpayers a surprise bill, and while the court has not ordered Arizona to post a bond, Kris Mayes needs to explain whether state money is at risk and how much,” Petersen said in a statement after the Washington Examiner contacted the state Senate president for a response.
“The Senate has received no fiscal or legal analysis from her office, so I support a public hearing where the Attorney General and State Treasurer can explain the potential cost, the safeguards in place, and whether legislative approval would be required,” he added. “Arizonans deserve those answers before they’re asked to pay a dime.”
Mayes is the Democratic state attorney general seeking reelection this year, and Kimberly Yee is the Republican state treasurer. Yee did not return a request for comment.
It’s not immediately clear whether other leaders in states involved in the litigation shared similar concerns to the state Senate’s Republican leadership in Arizona.
However, Petersen’s call for a public hearing adds pressure on his colleagues to press the state attorney general for answers about the possible taxpayer liability during a contentious time in the merger’s lawsuit, as Petersen mounts a campaign against Mayes.
California Attorney General Rob Bonta, who is leading the lawsuit against the merger, accused Paramount of blackmailing the states into backing down by seeking the $1.88 billion bond. Bonta has also been critical of Paramount’s reported threat to leave California if the state does not agree to settlement talks by Oct. 1.
For every day after Sept. 30, Paramount accrues roughly $7 million in “ticking fees” paid to Warner Bros. shareholders as long as the transaction is not closed. As of now, the two film studios can’t close the deal until June 2027 or the end of the March 2027 trial. But that outcome is dependent on whether they win the case. By the time it goes to trial next year, Paramount will have accrued over $1 billion in ticking fees.
PARAMOUNT SEEKS $1.88 BILLION BOND TO COVER FINANCIAL LOSSES FROM BLOCKED MERGER
The states argue Paramount and Warner Bros. violate federal antitrust law, namely the Clayton Antitrust Act of 1914, if they combine into one entity, reducing theatrical competition and cutting thousands of jobs in the entertainment industry. About 4,500 film and television jobs in Hollywood could be eliminated if the merger closes, according to a new report from the Los Angeles County government.
The rest of the state plaintiffs attached to the lawsuit alongside California and Arizona are Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, and Washington.