Paramount committed to increasing film production and investing millions in a worker support fund
Paramount’s US$81 billion merger with Warner Bros Discovery is set to advance after it reached an agreement to settle suits filed by 12 US states and the Writers Guild of America, reported The Associated Press.
California attorney general Rob Bonta said on Monday September 21 that Paramount had committed to increasing film production in the US over the next five years. It will invest at least another US$1.5 billion (US$300 million annually) in this commitment.
Paramount is expected to fulfill its vow to release 30 films a year for the next two years and 32 films for each of the following three years. Otherwise, it would be mandated to separate from Miramax Studios and allocate $30 million to health care and retirement trust funds linked to WGA and other industry unions for each missed movie.
Paramount must also negotiate separate deals for existing Paramount- and Warner-owned basic cable channels for the next five years in order to set a cap on consumer prices, according to the states. The company has also pledged to establish a “News Editorial Independence Board” to ensure that CNN and CBS news operations maintain editorial independence.
Moreover, Paramount has committed to injecting another US$47.5 million in a fund earmarked for the training and career development of workers impacted by the merger. The agreement is awaiting a judge’s approval.
Bonta said the settlement of the suit did not mean he supported the merger. New York attorney general Letitia James, who helped negotiate with Paramount to pledge US$17.5 million to WGA’s health care fund, said she would keep an eye on the company to ensure that it was meeting the terms of the settlement agreement.
The WGA reiterated its belief that the Paramount-WBD combination would “cause damage to writers and the industry at large” in a statement published by AP News; however, the nonprofit organization conceded that the litigation would have cost it millions.
Nonetheless, the settlement has been slammed as a sign of the state attorneys general bending to corporate pressure, with the terms being considered too weak.
“Today, billionaires have yet again bribed, censored, and bullied their way to the top. Layoffs will follow. People from L.A. to Atlanta will lose their jobs, small businesses will lose their contracts, your cable bill and movie ticket will be even more expensive,” said Alvaro Bedoya, American Economic Liberties Project senior advisor and ex-Federal Trade Commissioner, in a statement published by AP News on Tuesday September 22.
Bedoya claimed that Bonta and California governor Gavin Newsom folded after Paramount supposedly threatened to depart California.
For Newsom and Connecticut attorney general William Tong, the settlement was about protecting editorial independence, with Tong noting that Paramount would not grant CBS and CNN editorial independence just a week previously.
