Mumbai: Netflix has been hit with a consumer class action lawsuit seeking to halt its proposed $72 billion acquisition of Warner Bros Discovery’s studio and streaming assets, intensifying scrutiny around what could become one of the largest entertainment mergers in recent years.
Filed on Monday in the U.S. District Court for the Northern District of California, the lawsuit comes from an HBO Max subscriber who argues that the deal would significantly reduce competition in the U.S. subscription video-on-demand market. The plaintiff claims the merger would allow Netflix to dominate the sector and potentially control iconic Warner Bros franchises including Harry Potter, DC Comics, and Game of Thrones.
The filing follows growing concern among U.S. lawmakers, many of whom have questioned the competitive implications of the Netflix-Warner Bros tie-up. The merger is expected to face intense antitrust scrutiny from federal regulators.
Adding another twist to the unfolding battle, Paramount Skydance launched a competing and hostile bid worth $108.4 billion for Warner Bros Discovery, challenging Netflix’s offer and signaling a high-stakes clash among major entertainment giants.
While consumers have the right to sue under federal antitrust laws to block mergers, such cases are known to face steep hurdles. Still, the lawsuit argues that Netflix’s pattern of increasing subscription prices—even in the face of strong competition—signals the risk of further price hikes if a major rival like HBO Max is eliminated.
Netflix, in a statement, contested the claims, saying “we believe this suit is meritless and is merely an attempt by the plaintiffs bar to leverage all the attention on the deal.” Attorneys representing the plaintiff declined to comment.
The Warner Bros Discovery board has acknowledged Paramount’s competing offer and said it will review it. Warner Bros itself is not named as a defendant in the lawsuit.
The case, brought by the law firm Bathaee Dunne, adds to their roster of antitrust actions against entertainment and financial companies. The firm is also representing YouTube TV subscribers in an ongoing lawsuit alleging that Walt Disney Co. harmed competition in the live-streamed television market. Disney has agreed to pay an undisclosed amount to resolve that case while denying wrongdoing.
