Lawyers are arguing in federal court over whether a $450 million horror movie counts as a blockbuster

[NightHarbour30]

A federal court hearing over Paramount's 111 billion dollar merger with Warner Bros Discovery took a genuinely odd turn on Friday when lawyers spent part of an 80 minute session debating whether the low budget horror hit Obsession technically qualifies as a blockbuster. The distinction matters because a coalition of 12 state attorneys general, led by California's Rob Bonta, is trying to block the merger on antitrust grounds, arguing that only the five biggest legacy studios have the financial muscle to reliably produce, market and distribute genuine blockbusters, and that shrinking that number to four by letting Paramount absorb Warner Bros would choke off supply and ultimately raise prices for consumers

Paramount's lead attorney Jeffrey Kessler pushed back by pointing to Obsession specifically, a film made for around a million dollars that has earned over 450 million so far this year, arguing it proves major box office success can come from completely outside the traditional five studio system. He also cited F1, this year's Apple produced racing film, as evidence the theatrical market already has real new entrants beyond the legacy players. The states' attorney James Weingarten fired back that Kessler's own example undercut his argument, since F1 was actually distributed by Warner Bros, one of the two companies at the center of the merger itself, and that the states' blockbuster definition specifically requires a film to open on at least 3,000 screens, a bar Obsession's more modest theatrical rollout never cleared

Kessler also argued that Paramount and Warner Bros Discovery's cable networks are complementary rather than overlapping and that combining them wouldn't meaningfully harm competition, a claim Weingarten dismissed outright. He further argued that the states' entire framing ignores how much streaming has reshaped the business, contending that the growing streaming market actually compels increased theatrical production since theatrical success is what allows streaming to succeed in the first place, and noted Paramount has committed to boosting theatrical output to 30 films a year under the merged company

Judge Araceli Martinez-Olguin, who was only recently assigned to the case, did not rule immediately but said she would issue a written decision by July 22, the same date EU antitrust authorities are expected to grant their own approval and the earliest the deal could theoretically close. The states are seeking a temporary restraining order that would pause the merger for up to 28 days as a prelude to a possible longer preliminary injunction, while Paramount has argued the entire lawsuit reflects one of the weakest merger challenges in modern antitrust history and that further delay would only harm entertainment workers already squeezed by years of industry disruption

Is 'Obsession' A Blockbuster? Paramount, State AG Lawyers Spar At Hearingdeadline.com