Becerra Urges Antitrust Settlement as Paramount Threatens to Flee California

There is a particular species of Democratic pragmatism that dresses capitulation as maturity, and Xavier Becerra deployed it with practiced ease at a Politico conference this week. The Democratic nominee for California governor recommended that the 12 state attorneys general currently suing to block the Paramount-Warner Bros. Discovery merger settle the case before trial. “Conference room, not courtroom,” he said, as though he were offering wisdom rather than a retreat.

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Becerra served as California’s attorney general from 2017 to 2021. He knows, or ought to know, what it means when a gubernatorial candidate publicly pressures his own party’s sitting AG to fold an active enforcement action. Rob Bonta, who holds the job now, leads the coalition of a dozen state AGs in the antitrust suit. Becerra did not address the merits of their case. He did not need to. The signal was the message.

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The pressure has a source. Paramount CEO David Ellison has reportedly raised the prospect of relocating the company out of California if no settlement is reached. Becerra absorbed this threat and refracted it through the language of working families. “Having a major player in the industry leave would not be good,” he said. “Let’s be adults, not be kids.” One might note that the adults in this metaphor are the ones who capitulate to corporate relocation threats, and the children are the ones who believe antitrust law should be enforced on its own terms.

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Now, the complication. Becerra is not wrong that antitrust litigation is grinding, fact-intensive, and legally uncertain. The scholarly literature on merger challenges is not encouraging for plaintiffs. The Chicago School’s four-decade capture of antitrust jurisprudence has produced a federal bench that treats market concentration with the sort of indulgence one might extend to a difficult relative at Thanksgiving. State AGs who sue to block mergers face long odds, and settlements can extract behavioral remedies that trials cannot. This is the steel-man case for Becerra’s position, and it is not trivial.

But here is the complication