California Governor Gavin Newsom has reportedly expressed concerns privately about the state’s ongoing antitrust lawsuit challenging Paramount Global’s $110 billion acquisition of Warner Bros. Discovery. Sources familiar with the matter indicate that Newsom has warned stakeholders that blocking the merger could have adverse effects on jobs within the Hollywood industry.

The legal action, led by California Attorney General Rob Bonta in coordination with a coalition of 12 other state attorneys general, contends that the merger would undermine competition and harm consumers. This lawsuit remains the principal barrier preventing Paramount from finalizing the deal, especially after U.S. District Judge Araceli Martínez-Olguín, appointed by the Biden administration, issued a temporary restraining order last week halting the transaction.

While Newsom is not directly involved in the lawsuit and does not hold authority over the attorney general’s office, he has privately urged Bonta to consider settling the dispute outside of court. This position has reportedly created a rift between the two top California officials, reflecting differing views on how to handle the high-profile case.

A court hearing is scheduled for August 3, during which Judge Martínez-Olguín is expected to determine the timeline for the trial. Both the governor’s and attorney general’s offices declined to comment, with Bonta’s office stating it does not discuss potential or alleged internal communications.

Meanwhile, industry observers and legal experts continue to monitor the case closely, as its outcome could have significant implications for consolidation trends in the entertainment sector and employment in Hollywood.