Bonta said the settlement will help boost film production in the US. Under the agreement, Paramount must release at least 30 films each year.
To prevent the studio from fulfilling its annual quota with low-budget or automated content, Bonta said there were strict guardrails against “AI-generated” films.
Officials wanted to guarantee “real, robust movies” that generate economic activity and put people back to work, he added.
If Paramount fails to meet its annual production quota, it will be forced to sell its 49% stake in Miramax, the film company founded by disgraced Hollywood mogul Harvey Weinstein and his brother Bob.
“Divestitures are part of our solutions to all three markets,” Bonta said, arguing the deal turned what could have been a “falling off the cliff in domestic production into a huge increase,” leading to more movies, jobs, and economic activity.
However, Ned Thorne, an LA-based film editor, described the merger as “a little unsettling”.
He told the BBC World Business Report podcast: “When two giant companies consolidate into one it’s never a totally positive thing because of the merger and cost cutting.
“Whilst I know this might on somebody’s ledger be a great idea, it’s so far out of the hands of ordinary folks on the ground that it’s a case of who’s really going to be benefitting apart from a group of shareholders.”
Though Ellison previously indicated the merged company would keep its headquarters in California for the foreseeable future, Bonta clarified that this commitment was not written into the legal agreement.
“It’s not part of the deal,” Bonta said.
Ellison had previously threatened to move studio operations out of California.
To ensure remaining terms are enforced, Paramount has agreed to the appointment of an independent monitor to oversee ongoing compliance with the settlement.
California led the legal push alongside a coalition of state attorneys general from Arizona, Colorado, and New Jersey.
Under the deal’s initial terms, Paramount must ensure 20% of all film production takes place in the US for the first two years, rising over 30% over the following three years.
While mergers typically lead to corporate overlap and redundancies, Bonta maintained that it would be a “job creator” that will put people back to work across the industry.
Thanks to the deal, Bonta said that economic activity would be “$300m to $1.5bn more, at minimum, for film and TV production right here in our country”.
“Importantly, that is the baseline. That is the minimum,” Bonta said, noting that production commitments could surge by up to 700% if Congress passes a federal film tax credit.
