The legal battle over the Paramount Warner Bros merger escalated Monday after Paramount Skydance asked a federal judge to require 12 states challenging the $110 billion deal to post a $1.88 billion bond.

Paramount says the extraordinary bond is needed to cover potentially massive costs caused by delays to its acquisition of Warner Bros. Discovery. The request adds another high-stakes financial dispute to an antitrust fight that has already prevented the companies from completing one of Hollywood’s largest proposed mergers.

Paramount Says Delays Could Cost Billions

Under the merger agreement, Paramount must begin paying Warner Bros. Discovery shareholders approximately $7 million for every day the deal remains unfinished after September 30.

With the states’ antitrust trial scheduled for March, Paramount estimates it could pay roughly $1.3 billion in unrecoverable “ticking fees” by the time the trial ends and final legal briefs are submitted. The company is now asking the court to make the states put up $1.88 billion to address losses it says could result from their attempt to stop the transaction.

The request does not mean the states have been ordered to pay the bond. It is now up to the court to determine whether Paramount’s demand is justified.

States Say Merger Would Hurt Competition

California and 11 other states sued in July to block the Paramount Warner Bros merger, arguing that combining the two entertainment giants could reduce competition across film and television.

The coalition says the combined company could gain enough market power to increase prices and put additional pressure on theaters, television distributors and industry workers. Paramount has rejected those arguments and maintains that the transaction would strengthen its ability to compete with major technology and streaming companies.

A federal judge previously ordered Paramount to pause the acquisition after finding that the states had made a strong initial showing that the merger could harm competition. USA Herald previously reported that the court was concerned about changes such as layoffs and the sharing of sensitive business information that could be difficult to reverse if the deal were later ruled unlawful.

A $110 Billion Deal Remains in Limbo

The proposed acquisition would combine Paramount Skydance with Warner Bros. Discovery, bringing major film studios, television networks and streaming properties under one corporate umbrella.

The deal has already received federal antitrust approval, but the state lawsuit has prevented Paramount from moving ahead as planned.

The new $1.88 billion bond request raises the financial stakes considerably. What began as a fight over whether the merger would reduce competition is increasingly becoming a battle over who should bear the cost while the courts decide its fate.