The Agony and Agonizing of David Ellison

David Ellison, the man who vehemently assured the world his $111-billion Warner Bros. Discovery takeover was happening, is now at a standstill as California Attorney General Rob Bonta’s antitrust suit puts the whole deal in danger.

They say to know someone, walk a mile in their shoes. So in an attempt to know Ellison, let’s take a jaunt in their Tod’s. (Does he wear Tod’s? Is he more of a Gucci loafers fellow? Who’s to say?)

Here I am, stuck at an impasse. I could either give up this mega deal and walk away, or I could take it to court and see how it plays out … or I could move the entire operations of the company to another state. 

No, not New York. Or Chicago. Or even Atlanta. No, I’ll move it to Texas, or Tennessee. I’ll risk putting a huge chunk of the industry on the line, right after I’ve already cut loose thousands of jobs, in an effort to save face.

Why? Because there are ticking fees—penalties—financing—and it’s going to come crashing very, very soon. So let’s pitch uprooting the company to another state entirely, because I screwed up my own deal. 

According to the LA Times, the Paramount WB merger was not only Hollywood’s biggest merger in decades, but on a “fast track to completion by September.” However, the antitrust suit mounted threatens to derail the deal, or at minimum, make it a LOT pricier. Thus, the board at Paramount has allegedly approved the cockamamie relocation plan, which would include selling off both the Paramount and WB studio lots. 

Worse yet, earlier in the year, Paramount convinced Warner investors of its deal in part by adding “ticking fees,” aka extra money per share for every quarter after September 30th until this deal is over. It was supposed to say, “Hey WB investors, you’re going to get a sweet deal outta this, we promise.” It was also supposed to say, “You know those pesky regulatory reviews the government makes us go through? Don’t sweat it, we’re gonna breeze on right past ‘em.”

Welp. So much for that. 

It would appear Ellison’s hubris is what made him believe that the U.S. Department of Justice would approve the merger quickly and quietly. Oh, and those ticking fees? They could easily add up to $7 million a day. And that lawsuit that Bonta filed? It’s not scheduled to start until March 2nd of next year. Which means that Paramount would “be on the hook to pay around $1.2 billion to WB shareholders by the time the trial is scheduled to conclude.” This is IN ADDITION TO the $81 BILLION AMERICAN DOLL HAIRS that Paramount is already supposed to pay WB shareholders—AND they’re taking on roughly $30 billion of WB debt that was leftover from WB’s last merger in 2022. Remember that? Good times!

So, basically, Ellison wants everyone at Paramount to relocate if the deal doesn’t close by September 30th, because Ellison screwed up. Paramount would—nay, must!—cut costs, and moving somewhere with lower taxes and/or “business-friendly practices” (whatever that means!) once that ticking fee hits.

They don’t know where, but it’s gotta be somewhere, and it’s gotta be fast. 

This entire harebrained scheme is not just disruptive, desperate, and rife with the logistical issues that give even the best project manager nightmares—it’s STUPID.

Let’s not even get into the politics involved between the current U.S. government and the Ellison family. Instead, let’s examine this idea of relocation. 

First off, Paramount is a legacy studio. Many employees working there have been there for some time. Every time I ever walked on the lot, you could feel the history of filmmaking emanate from its walls and gates. Why move everyone? Hollywood depends on writers, directors, producers, actors, crew members, development teams, and so forth to make its product. Yes, things change, but it’s a damn shame to simply sell the space. Why not lease it to other hungry studios looking for lots to make things, like Apple TV or Amazon Prime or Netflix? Then, if you decided to change up operations later down the line, you’d still have soundstages, rather than having to duplicate them in your new home.

Secondly, for the sake or argument, let’s say Paramount needed a shakeup. How are you going to convince hundreds or thousands of employees to suddenly drop everything to move to another state in the central time zone, away from the epicenter of entertainment? And if the merger went through, are you expecting WB employees to do the same? (Keep in mind Paramount’s HQ in NYC—why not have folks move THERE, where there is ALREADY A FILM BUSINESS?? But noooo, that would make sense.)

Third, assume you can suddenly move everyone and still save money. You’re forgetting that everyone else is here. Of course there are pockets of entertainment in other places, and yes, shooting on location in Hungary and other European countries have seemingly become Hollywood hot spots to save money, but the vast majority of the entertainment is developed, produced, manufactured, marketed, sold, and distributed from Los Angeles.

Sure, you can incorporate companies under one umbrella—as The Hollywood Reporter pointed out, the Knicks and Madison Square Garden operate in New York, but the parent company’s HQ is in Nevada. But Paramount is in the TALENT BUSINESS. They need to attract the best and brightest, and that creative talent is mostly in—you guessed it—L.A. and NYC. Even for the engineers, it doesn’t make sense. How many would leave a cushy gig in Seattle for something that pays much lower across the country in a city without the infrastructure to help you network, grow, and learn?

Lastly, the idea to relocate isn’t even original. Much like our beloved sequels and franchises, it’s a tired trope that stems from Ellison’s father. After three decades in Redwood City, California, the tech company Oracle (which Ellison’s father runs) moves their HQ to Austin to avoid cost-of-living increases and higher taxes. Then, when that became too much, Oracle decided to move to Nashville.

Paramount needs funds to finance this deal and a legal win on their side, but a move to another state is not the answer. It will only harm the company. Whether that’s because they’ll lose valuable employees, have to start from scratch, and/or lose public trust, no one will want to work with Paramount anymore. It damages creatives, executives, and shareholders. “Champion of Hollywood,” my tush. Pfft.

David, you’ve been throwing a fit for months now. You lost. Stop with the obvious blackmail attempts. Pack it up, stop trying to buy WB, and go back to New York.