Gavin Newsom Folded on Paramount Deal, Former FTC Commissioner Says

Former Federal Trade Commission member Alvaro Bedoya told Briahna Joy Gray on Bad Faith that the settlement clearing Paramount Skydance's takeover of Warner Bros. Discovery gives California far less than Attorney General Rob Bonta claimed, and he laid most of the blame on Gov. Gavin Newsom.

Bedoya said Bonta "was talking this really big game" about accepting a settlement only if it involved selling off competing assets, then "walked out with none of the things he said he would demand."

Twelve state attorneys general, led by Bonta, approved the settlement on Sept. 21, 2026, according to TheWrap. Under its terms, Paramount commits to 30 wide-release films a year for the first two years and 32 a year for the following three, with at least half produced or jointly produced by Paramount. The company must spend at least $300 million a year on domestic production, or $1.5 billion over five years, put $9.5 million a year into workforce training and $5 million a year into an independent film purchase fund, keep both studio lots operating, and seat an independent five-member journalism board over CNN and CBS News within 180 days of closing. Violations of the film commitment carry a $30 million penalty per film, and failure to meet the cable terms could force the sale of channels including BET, Comedy Central and VH1.

Bonta's office, announcing the deal, said the settlement "resolves our antitrust concerns of the Warner Bros./Paramount merger — concerns that the merger will lower output and increase prices — by guaranteeing massive investment in domestic film production and providing enforceable guardrails to help keep cable prices competitive." Bonta said that what his office heard "over and over" from the people most directly affected was that "what matters most is consistent film output, domestic production, and protecting the livelihoods of workers above and below the line."

The Los Angeles Times reported that Newsom, Los Angeles Mayor Karen Bass and gubernatorial nominee Xavier Becerra pressed Bonta to settle rather than take the case to trial in March, and that Newsom said he took Paramount's threat to leave the state seriously.

Bedoya walked through the settlement's terms one by one and rejected them.

"First of all, there is no guarantee to make 30 films a year. Making a film is either producing or jointly producing it. Paramount, if you read the fine print of this thing, has only agreed to produce or jointly produce 15 films, okay? This is not a win," he said. By his count, Paramount and Warner Bros. together made 18 films last year, and only one was made in California. "So number one, 30 films is not 30 films. It's 15 films, and that's already what they're doing," he said.

On the journalism board, Bedoya said the Ellison family would appoint its members and hold enough votes to overrule them. "So this is the opposite of an independence board. It's a control board in reality," he said.

He called the $1.5 billion production spend the closest thing to a real concession, but noted it is a domestic commitment, not a California one. "There is no guarantee that the $1.5 billion be spent in California whatsoever," he said. He also said the deal does not lock the company's headquarters in the state: "there's nothing in the settlement that requires that the headquarters stay in California. It merely says that the lots that exist in California will continue to be run for film and TV purposes."

Gray asked directly: "What in your view is the reason why the California AG, Rob Bonta, bends the knee?"

"So I'll be honest with you. I have no idea what happened. The reversal was so sudden and so total that my hope is that there's some good reporting about what actually transpired here because it wasn't just that he settled," Bedoya said.

He said Newsom was, as best he could tell, the first California official to back a settlement, followed by Becerra and Bass. Bedoya said he has more sympathy for Bass, since a mayor asking a company not to move its headquarters is an ordinary act, but none for a governor who campaigns online as a fighter against Donald Trump and then yielded to David Ellison, whom Bedoya described as an heir rather than a principal in Trump's circle. "I don't think any of this would have happened had the governor had Rob Bonta's back in this, and yet he didn't, and look where we are," he said.

Bedoya argued the states had leverage and gave it away. The judge in the case, he said, found compelling evidence that the deal might be illegal on the count many observers considered weakest. A ticking fee of $7 million a day was set to begin Oct. 1, the Writers Guild had filed its own suit, and 5,700 industry workers had signed on publicly against the merger. He cited a job-loss analysis, which he said compared overlapping positions at the two companies, projecting 10,000 direct jobs lost in Los Angeles if the combined company pursues its planned $6 billion in synergies, and argued that the threat to leave California should have been weighed against those layoffs. "So there is no high road where everyone keeps their job in this negotiation other than potentially blocking the merger and making these guys compete, making these guys retain their workforces," he said.

He did not dismiss the money entirely. "So look, I will not begrudge a single person in the film and television industry that gets an extra job or a job that they weren't expecting because of the settlement. You go get that job, I hope you can pay rent for a couple more years because of it," he said.

But his verdict on the settlement as a remedy was blunt. "But in terms of the disease that this industry has suffered from, this is like taking a Tylenol, not taking antibiotics. This thing is going to get worse, significantly worse. You might feel okay for a couple of years because of this influx of capital, but there should be no illusion here that this is a solve for the problems the merger could create."