Paramount Drags Warner Bros. to Court Over Netflix Deal

Paramount Skydance has launched a legal battle against Warner Bros. Discovery, following a string of failed attempts to buy out the entertainment giant. The case, filed in Delaware Chancery Court on 12 January 2026, aims to force Warner Bros. Discovery to hand over key financial details about its massive $83 billion arrangement with Netflix. Paramount’s move comes after its eighth takeover bid was rejected, leaving the company keen to get its hands on information it says is vital for shareholders to make up their minds about Paramount’s own offer.

The lawsuit names Warner Bros. Discovery’s chief executive David Zaslav and the board, accusing them of not living up to their duty to provide shareholders with full and accurate information. Paramount’s legal team is pushing for the court to order Warner Bros. Discovery to cough up the details, arguing that shareholders are being left in the dark about how the Netflix deal was valued and what it means for their investments. The full legal complaint is available for those keen to read the nitty-gritty.

Paramount’s Claims and Shareholder Concerns

In the legal documents, Paramount argues:

‘While the Board’s conduct to date raises serious concerns and gives rise to various categories of fiduciary duty claims, Paramount brings this limited action now, seeking only disclosure of targeted material information, while reserving the right to seek further relief as appropriate. It does so because right now, WBD’s stockholders have an immediate need for the material information being withheld in order to make a decision on Paramount’s tender offer to them.’

David Ellison, who chairs Paramount and runs Skydance, also penned an open letter to Warner Bros. Discovery shareholders. He criticised the lack of transparency, saying:

‘WBD has failed to include any disclosure about how it valued the Global Networks stub equity, how it valued the overall Netflix transaction, how the purchase price reduction for debt works in the Netflix transaction, or even what the basis is for its “risk adjustment” of our $30 per share all-cash offer.’

Background: Bidding Wars and Industry Fallout

Since October 2025, Warner Bros. Discovery has been fielding offers from various companies. Paramount Skydance, led by Ellison, was seen as a frontrunner for a while, with Ellison making big moves to cement his place in the industry. But in a twist, Netflix swooped in as the preferred buyer in December 2025. Paramount quickly fired back with a counteroffer and even tried a hostile takeover, but to no avail.

The prospect of Netflix snapping up Warner Bros. Discovery has drawn plenty of criticism, with many in the industry worried about what it means for the future of film. Still, the idea of Ellison and Paramount taking over hasn’t exactly thrilled everyone either. Some reckon it could be even worse, given the controversies swirling around Ellison’s leadership and his efforts to get in the good books of the Trump administration.

Controversy Around Paramount’s Moves

Paramount’s recent decisions have raised eyebrows. The company is pushing ahead with Rush Hour 4, bringing back director Brett Ratner after a request from Trump. Ellison’s choice to put Bari Weiss from The Free Press in charge of CBS News has also sparked debate. Weiss has reportedly pulled stories critical of Trump from airing on 60 Minutes, and her shake-up of CBS News with anchor Tony Dokoupil has copped a fair bit of flak in just a couple of weeks.

Word is, Ellison is trying to win favour with Trump by promising to overhaul CNN, a Warner Bros. Discovery asset that’s been on the receiving end of Trump’s criticism for its coverage. All up, the battle for Warner Bros. Discovery is shaping up to be one of the most talked-about showdowns in the industry, with plenty of twists still to come.