The ParaBros Backlash: Threats To Leave L.A. & An AG Who Won’t Back Down Divide Hollywood

Paramount‘s pending acquisition of Warner Bros Discovery has evoked a range of emotion in Hollywood, mainly fear among creatives at the planned merger of two more major studios. But now that uncertainty is tinged with panic after CEO David Ellison threatened to relocate his Los Angeles-based company to Tennessee, Texas or Georgia.

Separately, the risks of both companies floating in limbo for the better part of a year as an antitrust suit by 12 state attorneys general wends its way to a March 2027 trial date has started to sink in.

So key guilds, trade groups and exhibitors are now urging Paramount and California Attorney General Rob Bonta to settle, even as many remain opposed to the merger, with a stream of sometimes confusing statements suggesting concessions to make the deal more palatable. But those proposed concessions are “behavioral,” Bonta has said. Promises, even in writing, aren’t the “structural” remedies, like asset sales, needed to preserve competition in markets the lawsuit claims are at risk.

“None of the noise from various constituencies makes Bonta’s case any weaker. It may pressure him to come to the table, but not to settle unless he feels that the competition in the market today will remain there afterwards,” said attorney Abiel Garcia, who began his career at the California DOJ as a deputy AG. He thinks the antitrust case is solid, “Not an easy win, but a good case. Ellison can’t do anything now except get Bonta to the table.”

Paramount had requested a November trial; the AGs asked for April. The judge set a March 2 start. “I think they [AGs] were looking at this in terms of what do we need to make sure our case is built as soundly as it can be,” said Garcia. “But the date had unintended consequences — the industry stepping in to say we can’t wait that long.”

Though both sides have agreed to the court-required mediation process, there are no formal settlement talks underway.

Speculation about a move to Nashville, where Ellison used to own a home, emerged earlier this summer and in August after he told Paramount’s leadership team that he would start the process of exiting California on October 1 absent settlement talks. Office headquarters could go first, followed by a slower move of studio staff and executives. The historic Melrose lot would likely be sold.

The date is timed to the October 1 trigger of a so-called ticking fee Paramount agreed to in the WBD deal – an onerous per-share payout that comes to about $7 million a day, or $650 million a quarter, until the deal closes. If the merger collapses altogether, Paramount would instead be on the hook for a $7 billion termination fee to WBD. The David Zaslav-led company has a contractual right to walk away as of June 4, 2027.

Bonta has called the threat to relocate “blackmail.” The Paramount camp denies that, insisting they’d prefer, of course, to stay in California but could save a boatload of money elsewhere, and that they don’t feel supported by their home state.

Taking him at his word, Nashville is a global music hub where Oracle, run by David Ellison‘s father Larry Ellison, has announced plans to expand. It’s building a massive campus for a world headquarters in the city’s East Bank area near the Cumberland River, a major area of new development.

Sony and other music labels and publishers large and small, adjacent business and countless musicians and artists have a large presence in there, as do agencies, and Paramount’s CMT (Country Music Television).

Tennesse’s core film and TV production incentive is a 25% rebate on eligible expenses in the state, with uplifts possible, on a minimum spend of $500,000.

“We aren’t big on red tape or fine print; there’s no per project cap, and this is not a first-come, first-served program,” says the website of the Tennessee Entertainment Commission. The state has no individual income tax on wages or salaries.

Projects shot there include films The Green Mile, Walk the Line, Hustle & Flow, Hannah Montana: The Movie, Robert Altman’s Nashville and the popular ABC/CMT drama of the same name starring the late Hayden Panettiere. Also shooting there is 9-1-1 Nashville and the Prime Video series Scarpetta starring Nicole Kidman, where Nashville stands in for Alexandria, VA.

Asked for comment, the Tennessee Department of Economic and Community Development said only: “Paramount is a globally recognized company and well-respected brand. While we cannot comment on specifics, TNECD remains committed to working with companies across a wide range of industries that are exploring opportunities to invest and grow in Tennessee.”

In July, when the state first came up as a potential new home for Par, Gov. Bill Lee jumped in on X, saying: “Tennessee is a place where innovation & creativity thrive. Paramount has played an important role in shaping American culture, & we’d welcome the opportunity to see the next chapter of that story unfold in the Volunteer State.”

Georgia and Texas are both better known filming destinations. The Peach State in particular has supercharged its incentives, infrastructure and crew base dramatically over the past decade to rival California and New York as a major U.S. hub.

Georgia’s Department of Economic Development was mum on a Paramount move. “We don’t comment on speculation or private correspondence. However, as a major film production hub with long-term relationships with our industry partners, we welcome any such conversations.”

As for Texas, it is fast up-and-coming and has been successful bringing in production. A newly sweetened incentive package just took hold this summer, nudged along by native Matthew McConaughey who was a frequent presence at the State House in Austin during deliberations. Soundstages have been popping up as well, from Taylor Sheridan’s SGS Studios in Fort Worth, the largest in the state, to The Chosen‘s film campus in Midlothian. There is activity in buzzy Austin (home of SXSW), Dallas, Houston and San Antonio.

“Texas offers the best business climate in America,” said Gov. Greg Abbott’s press secretary Andrew Mahaleris in a statement. “The state has no corporate income tax and no personal income tax. Paramount already maintains major production facilities in Texas and has filmed numerous successful productions in Texas over the years. Companies that leave high-tax, high-regulation states like California will find opportunity and success here.”

The New York Post reported that Austin’s Bluebonnet Business Center, a big commercial development, is a possible location. Deadline hears that particular site is not under consideration for the company’s relocation.

“I’ve said this before, and I firmly believe it: the future of film is Texas. We have the space, major city centers, incredible workforce, a pro-business environment, and now the long-term incentive investment created by our state leadership to prove it,” Chase Musslewhite, co-founder of Media For Texas, a nonprofit that’s been front and center in the state’s production push, tells Deadline.

“What’s really exciting is the chance for major industry partners to seize this opportunity too. Texans have always had a strong independent spirit, but we also welcome anyone who wants to invest in our communities and build the future of this industry together. From the perspective of the Texas film community, our doors are wide open.”

Generally speaking, a handful of southern states are considered particularly good places to do business, while California is regularly slammed for high taxes, regulation and cost of living. Nashville, Atlanta, Charlotte and Dallas took the top four spots in trade pub SiteSelection’s 2026 annual survey of leading national site consultants on which cities they favor for corporate headquarters projects.

As it did in 2025, California received the most votes for the Worst Business Climate in America.

A survey by another publication, AreaDevelopment, for 2025 saw Georgia, Texas and Tennessee at No. 1, No. 3 and No. 6 among the top 10 states for doing business.

That said, every industry has unique needs and a crew base is essential to film and TV production. SiteSelection respondents cited a skilled workforce, cost of living, incentives, quality of life and worker training programs the key elements when considering where to move.

The reaction from filmmakers and reps to Paramount’s potential move runs the gamut. After all, production has been fanning out across the country for years as more and more states add or boost incentives. Markets are dotted by new state-of-art studio complexes.

“At its worse, this is yet another example of politics leveraging our business for their own agenda,” said producer Marty Bowen, whose Temple Hill has a deal on the Melrose lot. “Our business is contracting and no longer a competition between studios. It’s a competition for eyeballs and we’re losing to digital media,” the Smile producer warned. “If the state doesn’t allow the merger, then they’ll need to figure out how to hold onto the industry because it’s already shown that is doesn’t need California.

“It’s sad to say but it’s true. Temple Hill has made over 50 movies and only one has been shot in L.A.”