Paramount’s Delrahim tells DOJ Netflix ran a “scorched-earth campaign”

Paramount is pushing back hard against Netflix's involvement in the regulatory process. In a letter to the U.S. Department of Justice sent on Friday to Jared A. Hughes and A. Maya Khan, Paramount chief legal officer Makan Delrahim accused Netflix of launching a “scorched-earth campaign” against Paramount in connection with its Warner Bros. Discovery merger, which is valued at $110 billion.

Delrahim’s argument is not subtle. He claims Netflix’s “panic-level response” shows it is taking David Ellison’s company seriously as “a scaled competitor,” and he says Netflix tried to “poison regulators and other stakeholders against” the deal. In other words, Paramount is telling the DOJ that Netflix is not just disagreeing, it is allegedly trying to influence how regulators and other parties view the transaction.

This matters because mergers in media are rarely just about who gets to stream what. They are about leverage across content budgets, bargaining power with distributors, and the long-term incentive structure for labor markets. The specific catalyst for Paramount’s latest move is a March report filed by the International Brotherhood of Teamsters. In that filing, the union argued to the DOJ that Ellison’s company posed “a direct threat to film and television workers nationwide.” The Teamsters also encouraged the DOJ to block the WarnerMount deal unless “substantial and enforceable safeguards” are put in place to increase domestic production and protect jobs.

Paramount’s response reframes the entire labor critique. The letter argues that organized labor will benefit from the “new competitive energy and increased content investment” the combined firm would bring to the entertainment industry. Paramount’s logic is that a stronger, more efficient competitor operating at scale will produce more content, which should translate into more opportunities downstream. Delrahim adds that the “Transaction presumably will spur other production opportunities, as well,” and he ties that to Paramount’s broader “content-first” growth strategy.

Here is the tight connection executives should notice: Paramount is trying to flip the burden of proof. Instead of accepting the premise that the merger is likely to reduce jobs or production, it is arguing that the business logic of the deal implies increased domestic production opportunities and more work. That matters in the DOJ’s framing, because regulators typically need credible pathways from the merger to harm or benefit. Paramount is presenting a narrative where competition and content investment increase, which then supports labor outcomes.

The letter also expands the scope beyond Paramount and Netflix. Delrahim wrote that, “As Paramount pushes forward with its ‘content-first' growth strategy, firms like Netflix, Amazon MGM, Disney, Universal, Sony, Lionsgate, A24, Apple, and many others will need to respond in kind.” This is a not-so-quiet signal to other players in the competitive stack: if one of the big consolidations changes the economics, everyone else may have to adjust content creation strategies to keep pace.

That competitive ripple is a second-order regulatory issue. Even when a merger technically focuses on specific parties, regulators and stakeholders look at industry-wide incentives. If Paramount is correct, the merger could trigger an investment arms race. If the Teamsters are correct, that investment could still come with labor downsides depending on how production is allocated and where the work lands. Paramount is asserting that the upside for organized labor follows “naturally” from the underlying deal. Whether the DOJ finds that chain convincing is another matter, but the point is clear: Paramount wants regulators to see labor claims as manageable within competitive dynamics, not as structural threats.

Meanwhile, this dispute is happening inside a broader environment of heightened scrutiny. TheWrap reports that state attorneys general are reportedly preparing to move forward with a lawsuit to block the $110 billion deal as soon as this month. California Attorney General Rob Bonta is investigating the deal and previously told TheWrap that “red flags are everywhere when you have a merger of this type,” adding that the states were prepared to “act timely,” though she did not provide a specific timeline. A spokesperson for Bonta told TheWrap on Friday that they continue to actively investigate the Paramount-WBD merger but declined to comment further.

That layering effect is where the stakes get real for decision-makers. Paramount is now arguing with Netflix in a DOJ-facing letter, while states prepare potential litigation. For boards and executives, this is a reminder that transaction risk is no longer a single-track issue. It can involve federal review, labor stakeholder pressure, and state-level actions that can run in parallel. And because media deals influence not just corporate control but also content pipelines and job distribution, the arguments are inherently political and operational at the same time.

Netflix and the Teamsters did not immediately respond to TheWrap’s request for comment, leaving Paramount’s framing as the loudest official narrative in the story so far. But the regulatory clock does not care which narrative is louder. It cares which narrative regulators and courts find most supported. In that sense, Paramount’s “scorched-earth” accusation is both a defense and a maneuver: it is trying to protect the merger by challenging the credibility and intent of a key opponent, just as the deal’s supporters and critics escalate their pressure campaigns.