A fourth lawsuit has been filed looking to block Paramount‘s bid to acquire Warner Bros. Discovery, this time by shareholders who accuse David Ellison and his father, Oracle scion Larry Ellison, of striking an illegal deal with President Trump for approval of the merger.
In a lawsuit filed on Tuesday in Delaware Chancery Court, the investors claim that the Ellisons promised to make sweeping changes at CNN to greenlight the acquisition. They also point to an alleged promise for up to $20 million in free advertising and a $16 million payment to Trump through a prior settlement by the studio’s previous ownership to resolve an allegedly frivolous lawsuit he had filed against CBS.
“The Ellisons’ actions not only harm the reputations of the news outlets they currently own, which are hemorrhaging viewers, but they are latent liabilities waiting to be triggered by a future administration,” states the complaint.
The lawsuit brings claims for breaches of fiduciary duty for creating “enormous financial and legal risk” for Paramount. It names the Ellisons and other members of Paramount’s Board of Directors.
The legal action follows a coalition of 12 state attorneys general, the Writers Guild of America and Paramount+ subscribers suing the studio for a court order to stop the merger.
Paramount didn’t immediately respond to a request for comment.
In the complaint, the investor alleges that Trump helped ensure that Paramount won the bidding war for Warner Bros. Discovery and removed regulatory barriers to the deal. Congress and future administrations will likely investigate the studio, creating significant long-term legal exposure, the lawsuit says.
At the same time, CBS News is hemorrhaging viewers, with the broadcast news network recording its lowest ratings in 25 years, according to the complaint. The lawsuit also says that Paramount’s decision to transform CBS’s coverage has triggered a talent exodus.
“After receiving regulatory approval, the Ellisons proceeded to remake CBS in the President’s image, bought properties he enjoyed, and even hosted events to honor him,” writes Mary Thomas, a lawyer for the investor, in the complaint. “This helped the Ellisons, but it appears to have hurt Paramount and its media outlets.”
In a near-midnight announcement on July 1, Paramount Global said it would pay $16 million “in total” to settle a lawsuit from President Trump, who sued over an interview that 60 Minutes conducted with Kamala Harris. That night, New York Post‘s Charles Gasparino reported that there was also a “side deal” that helped seal the pact worth up to $20 million of programming in support of conservative causes, which was immediately followed by Paramount clarifying that it wasn’t aware of such terms. Trump later said he received millions in advertising from the “new owners” of Paramount.
Paramount has denied claims that the settlement includes public service announcements and said it “has no knowledge of any promises or commitments made to President Trump.” It’s maintained that the terms of the deal “are those disclosed by us” in the July 1 announcement.
On Wednesday, ProPublica reported that FCC chairman Brendan Carr and fellow Republican FCC commissioner Olivia Trusty received pricey gifts valued at thousands of dollars from Paramount: Tickets to the Kennedy Center Honors, which were televised by the network.
Since 2024, the Federal Communications Commission has had significant oversight of the studio. It signed off on Skydance’s deal to acquire Paramount Global, approving the transfer of broadcast licenses. It’s also currently reviewing a request that would permit Gulf sovereign wealth funds to own a 49.5 percent stake in the combined company, though they wouldn’t have any governance rights.