Trump initially filed his suit for $10 billion, but later bumped that number up to $20 billion (more than twice the value of the $8 billion Skydance merger). The lawsuit concerns edited footage of then-Vice President Kamala Harris during her presidential campaign; CBS News claims lines were cut for clarity (standard practice for journalists), while Trump and conservatives have cried bias. Lawmakers and First Amendment experts alike have warned Paramount that settling the suit would constitute bribery for getting the merger done. (“Under the federal bribery statute, it is illegal to corruptly give anything of value to public officials to influence an official act. If Paramount officials make these concessions in a quid pro quo arrangement to influence President Trump or other Administration officials, they may be breaking the law,” a letter from Senators Elizabeth Warren, Bernie Sanders, and Rob Wyden reads.) WSJ reports that Paramount execs are indeed concerned that settling “could expose directors and officers to liability in potential future shareholder litigation or criminal charges for bribing a public official.” However, their hope was to settle within a similar range to other companies like Disney and Meta—a hope that could be dashed if Trump keeps turning the screws for more cash.
Paramount’s current majority shareholder, Shari Redstone, has recused herself from negotiations regarding the Trump lawsuit. But her family’s financial situation is in utter peril without merger approval, as laid out by a recent Los Angeles Times report, and there is plainly pressure from on high to not only settle the suit but also to appease the president with more favorable news coverage. (Trump routinely complains about and threatens networks over bad press.) This has led to dissent among the ranks, with multiple high-profile news leadership stepping away from the company and citing undue corporate oversight as an issue—60 Minutes even criticized it on the air. Unfortunately for Redstone, if an apology from CBS News is indeed crucial to the settlement, that makes the settlement even less likely; the journalists involved see such a move as a “red line,” per the L.A. Times, and the executives that have already left “refused to apologize to Trump as part of any settlement, the knowledgeable sources said.”
Trump’s increasing and unrealistic demands could finally force Paramount brass to grow a backbone. The company previously declared Trump’s suit “completely without merit,” tried to get it thrown out as an “affront to the First Amendment,” and threatened to dive into the president’s financials if the case moves forward. But it’s unclear given Paramount’s uneasy financial situation if the studio even has the funds necessary to settle, let alone to fight a legal battle against the President of the United States. (Skydance’s David Ellison has agreed to pay the Redstones a lot of money and take on a lot of Paramount’s debt to make the merger happen. His father, billionaire Larry Ellison, is a longtime Trump ally who also infused some cash into the Paramount deal.) Of course, bullies tend to prefer facing opponents who are desperate, weakened, and vulnerable. According to WSJ, mediation between both parties is expected to take place on Thursday.
