Paramount Skydance Accuses Netflix of ‘Scorched-Earth Campaign’ Against Warner Bros. Merger

Paramount Skydance has accused Netflix of orchestrating a “scorched-earth campaign” to undermine its $110 billion acquisition of Warner Bros. Discovery, according to a letter from the studio’s chief legal officer to the U.S. Justice Department. The filing, obtained by NBC News, claims Netflix is attempting to sway regulators and stakeholders by framing the merger as a threat to labor and content production.

What is the current status of the Paramount-Warner merger?

The merger, which saw Paramount Skydance—owned by tech billionaire David Ellison—win a bidding war for Warner Bros. Discovery in late February, received shareholder approval in late April. The deal, which would combine two major entertainment entities, remains under review by Trump administration regulators. The Justice Department has not commented publicly on the matter.

What are the main concerns raised by the Teamsters union?

The International Brotherhood of Teamsters submitted a March report to the Justice Department arguing that the merger poses “a direct threat” to workers, particularly those in production roles. The union called for “substantial and enforceable safeguards” to protect jobs and domestic production. Paramount’s legal chief, Makan Delrahim, rejected these claims, stating that the combined entity would “increase content investment and competitive energy.”

How is Netflix responding to these allegations?

Netflix has not issued a public response to Paramount’s accusations. However, Delrahim’s letter accuses the streaming giant of launching a “broader proxy war” by leveraging labor concerns and referencing the 2019 Disney-Fox merger as a cautionary tale. He argued that Disney’s acquisition of 21st Century Fox “unequivocally increased content spending,” contradicting Netflix’s claims.

What other groups are opposing the merger?

The deal faces opposition from over 1,000 Hollywood professionals, including actors and directors, who warned of “further consolidation” in the media landscape. California Attorney General Rob Bonta’s office is investigating the merger, while the U.K.’s antitrust authority launched a formal probe on Tuesday. Paramount’s CEO has pledged to release 30 films annually in theaters, though the company’s streaming strategy remains unclear.

Why is this merger significant for the entertainment industry?

The merger would create one of the largest entertainment conglomerates in the U.S., combining Warner Bros. Discovery’s film and TV assets with Paramount’s streaming and production capabilities. Critics argue it could reduce competition at a time when media consolidation is already a concern. Proponents, including Delrahim, emphasize the potential for “next-generation” content and innovation.