California Attorney General Rob Bonta led a coalition of 12 states in filing a federal antitrust lawsuit to block the $111 billion merger of Paramount Skydance and Warner Bros. Discovery.
The lawsuit filed in San Francisco alleges the deal violates the Clayton Act by substantially lessening competition.
Participating states including New York, New Jersey, and Colorado claim the merger would increase consumer prices and reduce creative opportunities.
The legal challenge specifically highlights potential harm to the theatrical film market.
The U.S. Department of Justice previously approved the transaction.
The coalition is seeking a court order to delay the merger's closing until the litigation is resolved.