Ellisons Sued by Paramount Investor Over Alleged Trump Side Deal for WB Approval

Key Points:

• Paramount shareholder Paul Robbins has filed a lawsuit in Delaware Chancery Court alleging that David and Larry Ellison made an illegal deal with former President Donald Trump to secure regulatory approval for Paramount's $111 billion merger with Warner Bros. Discovery (WBD), seeking to block the merger and claim damages.
• The lawsuit claims the Ellisons promised Trump private benefits, including funneling cash by settling his legal claims against CNN and firing CNN anchors disliked by Trump, actions which allegedly harm the reputation of Paramount’s news outlets and pose future liabilities.
• The suit follows other legal challenges to the merger, including a federal antitrust lawsuit by 12 Democratic state attorneys general and a Writers Guild of America suit citing negative impacts on writers’ pay and opportunities.
• Paramount denies the allegations, stating no commitments were made to any government body regarding CNN or other news properties, and asserts the merger will benefit consumers with more choice and investment in programming.
• The complaint highlights concerns over the lack of regulatory scrutiny, including from CFIUS, despite significant foreign investment, warning that future administrations may challenge the deal, creating risks for Paramount investors and alleging breaches of fiduciary duty by the Ellisons and Paramount’s board members.