WEBVTT - Paramount Settles Suit & EPA Repeals Climate Controls 0:00:02.759 --> 0:00:07.030 This is Bloomberg Law with June Grosso from Bloomberg Radio. 0:00:08.730 --> 0:00:13.790 This settlement is not a vote of support for this merger. 0:00:14.530 --> 0:00:19.130 It is not a blessing of the broader merger. Broadly speaking, 0:00:19.670 --> 0:00:23.860 we believe further consolidation in markets that are essential to 0:00:23.890 --> 0:00:29.020 American economic life doesn't serve the American economy, consumers, or 0:00:29.680 --> 0:00:30.540 competition well. 0:00:31.690 --> 0:00:35.650 The settlement of the antitrust lawsuit brought by 12 states 0:00:36.150 --> 0:00:39.680 may not be a vote of support for Paramount's historic 0:00:39.680 --> 0:00:44.339 $ 110 billion acquisition of Warner Brothers, but it was a 0:00:44.400 --> 0:00:48.800 vote to remove the final obstacle to the deal. Attorneys 0:00:48.860 --> 0:00:52.580 General from 12 states and the Writers Guild had sued 0:00:52.620 --> 0:00:55.980 to block the deal, arguing that it would give Paramount 0:00:56.060 --> 0:00:59.670 an undue share of the movie and cable TV industries. 0:01:00.140 --> 0:01:04.810 The settlement announced by California Attorney General Rob Bonta doesn't 0:01:04.870 --> 0:01:09.050 do anything to change that dominance. It just calls for 0:01:09.130 --> 0:01:14.270 some new commitments from the company without any divestitures. The bloc, 0:01:14.290 --> 0:01:18.720 the Merger Coalition, which represents more than 40 organizations that 0:01:18.780 --> 0:01:24.259 oppose the tie-up, slammed the settlement, calling it a sweetheart deal. Quote, 0:01:24.380 --> 0:01:28.200 we are disappointed and angry. that the interests of average 0:01:28.260 --> 0:01:34.010 Americans have been trampled to benefit oligarch billionaires. The blockbuster 0:01:34.050 --> 0:01:38.890 deal will vastly reshape Hollywood, with Paramount now controlling two 0:01:38.930 --> 0:01:43.970 of its biggest studios, two major subscription streaming services, and 0:01:44.110 --> 0:01:49.640 dozens of TV channels ranging from CBS to HBO. Joining 0:01:49.660 --> 0:01:54.970 me is Bloomberg Intelligence Senior Litigation Analyst Jennifer Reed. Jen, 0:01:55.010 --> 0:01:57.790 what is Paramount giving up to get this settlement? 0:01:58.410 --> 0:01:58.970 Very little. 0:01:59.350 --> 0:02:00.930 Really, at the end of the day, I think this 0:02:01.010 --> 0:02:04.590 is a win for Paramount and a surprising settlement because 0:02:04.630 --> 0:02:08.120 we all expected something structural, a structural aspect. And that's 0:02:08.160 --> 0:02:10.380 where I see it as a win for Paramount because 0:02:10.400 --> 0:02:13.000 there's nothing structural in it. By that, I mean, June, 0:02:13.040 --> 0:02:15.440 that they have to sell something rather than just making 0:02:15.480 --> 0:02:17.400 a bunch of promises about how they're going to behave 0:02:17.480 --> 0:02:20.730 once they're merged. Now, there are some divestiture commitments in here, 0:02:20.750 --> 0:02:23.720 but only if The merged company is in breach of 0:02:23.760 --> 0:02:25.990 certain terms of which I doubt they'd be in breach 0:02:26.030 --> 0:02:29.049 of because it's actually a pretty easy agreement with which 0:02:29.090 --> 0:02:29.750 they can abide. 0:02:30.110 --> 0:02:33.829 And I understand that a lot of these terms Paramount 0:02:33.850 --> 0:02:37.989 had been offering for months, including releasing 30 films a 0:02:38.030 --> 0:02:38.830 year in theaters. 0:02:39.690 --> 0:02:42.810 Yes, you know, they had. And I think in some ways. 0:02:43.360 --> 0:02:45.860 I believe some of these commitments really aren't a big 0:02:45.919 --> 0:02:48.860 change from the way they've just always done business. You know, 0:02:48.880 --> 0:02:51.720 for instance, people are talking about this commitment to release 0:02:51.720 --> 0:02:55.780 30 movies to theaters every year. Now, that's release, not make. 0:02:56.200 --> 0:02:58.180 So it doesn't necessarily have to be a movie that 0:02:58.200 --> 0:03:01.080 they produce, but they only have to either produce or 0:03:01.139 --> 0:03:05.480 co-produce 50%. So that's the first thing. And it's really 0:03:05.580 --> 0:03:09.160 not that different from what they're already each individually doing. 0:03:09.800 --> 0:03:12.680 So this isn't asking for much from Paramount. 0:03:13.889 --> 0:03:17.140 And it seemed like California and the states were holding 0:03:17.220 --> 0:03:21.120 all the cards. Paramount was set to face late fees 0:03:21.180 --> 0:03:24.680 of $ 7 million a day if it didn't close the 0:03:24.720 --> 0:03:27.790 deal by the end of the month and $ 7 billion 0:03:28.010 --> 0:03:32.090 if the deal fell apart. The states beat Paramount in court, 0:03:32.169 --> 0:03:36.380 winning a court-ordered pause on the merger. And the company 0:03:36.480 --> 0:03:40.300 agreed to pause the merger until as late as next June. 0:03:40.660 --> 0:03:43.440 It seemed like they had an edge in the negotiations 0:03:43.760 --> 0:03:44.220 at this point. 0:03:44.320 --> 0:03:47.050 Absolutely. It was a very odd situation because I think 0:03:47.090 --> 0:03:51.250 the states very much had leverage, not because their case 0:03:51.310 --> 0:03:54.170 against the merger was so strong, because honestly, it wasn't 0:03:54.210 --> 0:03:57.570 that strong, but because time. Time and the financial aspects 0:03:57.590 --> 0:03:59.790 were on their side. And I really think that they 0:03:59.810 --> 0:04:01.710 could have waited this out. It would have put more 0:04:01.770 --> 0:04:04.840 pressure on Paramount. maybe they might have gotten better terms. 0:04:04.900 --> 0:04:07.600 But then Paramount, knowing, I believe, that it didn't have 0:04:07.640 --> 0:04:10.480 the leverage it needed for a settlement negotiation to come 0:04:10.520 --> 0:04:13.660 out favorably, threatened to leave California. And I think that's 0:04:13.700 --> 0:04:16.669 what did it, because that would have been devastating on 0:04:16.690 --> 0:04:19.489 the state and had an impact on the state's economy, 0:04:19.570 --> 0:04:22.190 as well as so many employees and people who live there. 0:04:22.450 --> 0:04:25.290 And I think it was that threat that the Attorney 0:04:25.330 --> 0:04:27.870 General of California called blackmail. I think of it as 0:04:27.910 --> 0:04:29.909 just trying to do what they can to get leverage 0:04:30.210 --> 0:04:32.300 that did give them the leverage to to get to 0:04:32.360 --> 0:04:34.279 this settlement and to get to it when they did, 0:04:34.339 --> 0:04:37.110 which was mid-September. And I kind of thought late September 0:04:37.150 --> 0:04:38.110 would be more likely. 0:04:38.529 --> 0:04:39.169 Apparently. 0:04:39.890 --> 0:04:44.130 Pressure was on the Attorney General Bonta from the governor, L.A. 0:04:44.130 --> 0:04:47.750 's mayor. I mean, would Paramount really have left California 0:04:48.089 --> 0:04:48.529 in the end? 0:04:48.770 --> 0:04:51.210 It really would have been a major disruption to their 0:04:51.230 --> 0:04:54.599 business and actually quite an endeavor and very expensive for them. 0:04:54.890 --> 0:04:56.720 And that was the big question. You know, it was funny. 0:04:56.800 --> 0:04:59.120 I had so many clients saying, you know, are they 0:04:59.140 --> 0:05:00.580 going to do this or not? Is this a real 0:05:00.600 --> 0:05:02.440 threat or not? And I'd say, look, I'm not in 0:05:02.480 --> 0:05:04.789 their head. So California had its reasons for this. 0:05:04.810 --> 0:05:04.880 Yes. 0:05:20.450 --> 0:05:23.250 But the other states, and there were several states that 0:05:23.290 --> 0:05:27.909 were holding out, including New York, Connecticut, Massachusetts, and Minnesota. 0:05:28.450 --> 0:05:32.070 According to Bloomberg sources, they decided that the expense of 0:05:32.190 --> 0:05:36.770 litigating without California would be too much. So litigation would 0:05:36.810 --> 0:05:39.050 be too much for those states? 0:05:39.390 --> 0:05:41.070 You know, I have to say that if you look 0:05:41.130 --> 0:05:43.730 at the cases where states have been the plaintiffs and 0:05:43.770 --> 0:05:47.110 alone without the federal government or without private parties, it 0:05:47.170 --> 0:05:49.500 tends to be pretty big groups of states. You have 0:05:49.500 --> 0:05:52.340 12 You have 14. I think it was something like 0:05:52.339 --> 0:05:55.620 14 when the state sued to block T-Mobile and Sprint. 0:05:55.900 --> 0:05:58.140 You had a pretty big group of states going after 0:05:58.200 --> 0:06:00.320 Nexstar and Tegna and also a big group of states 0:06:00.339 --> 0:06:03.080 going after Live Nation. They have very small group. They 0:06:03.120 --> 0:06:06.180 have one or two antitrust attorneys. They don't have the money. 0:06:06.220 --> 0:06:08.700 They don't have the physical resources. And then they're going 0:06:08.779 --> 0:06:11.750 up against major heavy hitter lawyers on the other side 0:06:12.170 --> 0:06:16.229 and unlimited resources, essentially. They really do need– and California 0:06:16.250 --> 0:06:19.200 was leading. So you have to remember that. This litigation 0:06:19.260 --> 0:06:21.440 now has been going for quite some time. California has 0:06:21.460 --> 0:06:23.560 been in the lead. It is a little bit difficult 0:06:23.580 --> 0:06:26.070 for another state to take over that role and jump in. 0:06:26.450 --> 0:06:31.070 So I do think that once California and other states, 0:06:31.089 --> 0:06:33.830 aside from New York, had decided that they were going 0:06:33.850 --> 0:06:36.430 to settle, the other states really had to, as did 0:06:36.470 --> 0:06:38.750 the Writers Guild of America, which was also a plaintiff. 0:06:38.930 --> 0:06:41.229 Yeah, the Writers Guild apparently was blindsided. 0:06:41.670 --> 0:06:41.850 Right. 0:06:41.890 --> 0:06:44.630 I haven't seen as much news, but the settlement they 0:06:44.710 --> 0:06:48.880 reached And I think they must have been blindsided because 0:06:49.220 --> 0:06:52.410 their concerns about harm were to writers markets, writers of movies, 0:06:52.750 --> 0:06:56.489 writers of television shows, writers that are signed on contract 0:06:56.529 --> 0:06:59.420 with studios. And instead, what they agreed to was some 0:06:59.450 --> 0:07:03.440 guarantee of employment for CBS News Bureau, which is different from... 0:07:03.990 --> 0:07:05.650 the areas which they said would be harmed. 0:07:05.950 --> 0:07:08.860 So now let's talk about that. You have now Paramount 0:07:09.000 --> 0:07:12.040 is going to control both CBS News, and we've seen 0:07:12.080 --> 0:07:16.700 what's happened at CBS News. So they'll control CBS and CNN. 0:07:16.940 --> 0:07:20.550 And apparently the Connecticut Attorney General was really pushing for 0:07:20.610 --> 0:07:24.830 divestiture of those networks, but Ellison would not agree to that. 0:07:25.370 --> 0:07:29.590 So now there's going to be an independent editorial oversight board. 0:07:29.710 --> 0:07:30.830 What does that mean? 0:07:31.250 --> 0:07:35.310 Well, you know, let's just say that It's really something 0:07:35.350 --> 0:07:37.990 that's quite unenforceable. So it's a board made up of 0:07:38.090 --> 0:07:41.510 five people. They have to be journalists, retired or currently 0:07:41.970 --> 0:07:44.830 acting journalists. And there are a bunch of qualifications written 0:07:44.870 --> 0:07:46.710 into the settlement as to what that means to be 0:07:46.750 --> 0:07:49.790 an experienced journalist. And no more than two can be 0:07:49.830 --> 0:07:53.150 from the same political party. But here's the kicker. They 0:07:53.180 --> 0:07:56.440 will be appointed by Paramount. So Paramount will be picking 0:07:56.480 --> 0:07:59.610 these five people. even though no more than two can 0:07:59.630 --> 0:08:02.350 be from one political party. So they're picking the editorial 0:08:02.410 --> 0:08:06.250 board that's supposed to oversee their own business, which that 0:08:06.290 --> 0:08:09.000 seems to me a little bit ridiculous if you really 0:08:09.060 --> 0:08:12.780 wanted this neutral editorial board. But the board is intended 0:08:12.900 --> 0:08:17.940 to establish guiding editorial principles. And those principles are supposed 0:08:17.960 --> 0:08:21.810 to be based on CBS News' and CNN's standards and 0:08:21.870 --> 0:08:26.950 practices now before they close. So whatever their practicing policies 0:08:27.030 --> 0:08:29.390 are now, they're supposed to stick to those. And this 0:08:29.430 --> 0:08:31.390 board is supposed to make sure that they stick to those. 0:08:32.120 --> 0:08:34.420 And then they're going to resolve disputes if they arise 0:08:34.760 --> 0:08:37.560 between CBS News or CNN and the management of the 0:08:37.600 --> 0:08:38.360 combined company. 0:08:38.740 --> 0:08:42.800 So, I mean, under that, could Paramount put Barry Weiss 0:08:42.840 --> 0:08:43.860 in charge of CNN? 0:08:44.160 --> 0:08:45.080 Oh, I do think so. 0:08:45.140 --> 0:08:45.380 Yes. 0:08:45.740 --> 0:08:48.000 I don't see why not. There's nothing in this that 0:08:48.020 --> 0:08:49.819 would prevent that as far as I've seen. 0:08:50.630 --> 0:08:53.910 And so let's say you see that there's pressure on 0:08:53.970 --> 0:08:57.150 CNN to take a conservative turn to, let's say, have 0:08:57.190 --> 0:09:01.490 more stories in favor of the administration. What can be done? Anything? 0:09:01.770 --> 0:09:03.429 Well, the first thing that would happen is if there 0:09:03.490 --> 0:09:06.929 was a dispute, if the journalists object to this, then 0:09:06.970 --> 0:09:10.870 this dispute between those journalists and the Paramount management would 0:09:10.910 --> 0:09:14.760 be resolved by this editorial independence board. Now, there's another 0:09:14.820 --> 0:09:18.660 layer that oversees this entire agreement. There's a monitor. There 0:09:18.679 --> 0:09:21.160 will be an internal monitor and then also an outside 0:09:21.220 --> 0:09:25.000 monitor chosen by the states and Paramount together. And then 0:09:25.059 --> 0:09:28.610 that monitor could step in. But the thing is, June, 0:09:28.640 --> 0:09:32.030 if there's some problem, if whatever's happening is considered a breach, 0:09:32.630 --> 0:09:34.670 really the only way to fix it, the only way 0:09:34.710 --> 0:09:36.790 to make the company act differently would be then to 0:09:36.830 --> 0:09:39.530 go back to court. You'd need the states. You'd need 0:09:39.570 --> 0:09:42.309 the attorney generals to agree. They'd have to bring this 0:09:42.410 --> 0:09:44.189 up back in court in front of the judge that 0:09:44.250 --> 0:09:46.960 was overseeing this litigation to start. And, you know, that's 0:09:47.020 --> 0:09:48.920 a lot. And I'm not so sure I see something 0:09:48.940 --> 0:09:49.720 like that happening. 0:09:49.980 --> 0:09:53.520 You said before the States case wasn't necessarily great. But 0:09:53.540 --> 0:09:57.370 you have this one company controlling two of Hollywood's biggest studios, 0:09:57.450 --> 0:10:01.760 two major subscription streaming services. and dozens of TV channels. 0:10:01.780 --> 0:10:02.059 Right. 0:10:02.360 --> 0:10:04.040 Ranging from CBS to HBO. 0:10:04.380 --> 0:10:04.600 Right. 0:10:04.660 --> 0:10:08.440 Why isn't that a good case for antitrust? 0:10:08.620 --> 0:10:12.000 Because at the end of the day, antitrust cases in court, 0:10:12.230 --> 0:10:13.910 to have a strong case in court, it's going to 0:10:13.950 --> 0:10:17.069 come down to the way markets are defined and market shares. 0:10:17.130 --> 0:10:19.850 It's really mathematical at the end of the day. you 0:10:19.929 --> 0:10:21.990 look at the market, you look at the market shares 0:10:22.030 --> 0:10:24.030 in that market, and there's a computation you can do 0:10:24.370 --> 0:10:27.790 to determine how concentrated that market is. And the guidelines 0:10:27.830 --> 0:10:30.479 that are used by the Department of Justice, Federal Trade Commission, 0:10:30.520 --> 0:10:33.620 and generally used by the judges, even though they're not binding, 0:10:33.880 --> 0:10:35.340 give you a number. And they say, well, if it's 0:10:35.380 --> 0:10:37.559 over that number, you have a presumption of harm. If 0:10:37.600 --> 0:10:40.230 it's under that number, you really don't, you're probably not 0:10:40.250 --> 0:10:43.490 going to win. To get over that number, the states 0:10:43.550 --> 0:10:46.870 define the markets in a very specific way that could 0:10:46.890 --> 0:10:49.329 be rebutted. And they used market share numbers from a 0:10:49.410 --> 0:10:53.120 very specific time period. And if you change that time period, 0:10:53.140 --> 0:10:56.480 those market shares change quite a bit. And in using 0:10:56.660 --> 0:10:59.740 what they used, which Paramount would call gerrymandered, I would 0:10:59.760 --> 0:11:04.120 call just good advocacy. By using those numbers, they actually 0:11:04.200 --> 0:11:08.620 barely hit those thresholds of harm, right? So this was 0:11:08.660 --> 0:11:11.080 their problem. And if Paramount could have come into court 0:11:11.100 --> 0:11:13.140 and sort of poked holes in the way they defined 0:11:13.160 --> 0:11:15.500 the market, or poked holes in that time period they 0:11:15.580 --> 0:11:17.900 used for shares, it would have been problematic. And one 0:11:17.960 --> 0:11:21.040 other really big thing is that in merger cases, where 0:11:21.080 --> 0:11:23.140 you have the threat of new entry, the threat of 0:11:23.200 --> 0:11:25.679 new entry can be a really good defense. Okay, these 0:11:25.720 --> 0:11:28.000 may be our shares today, but we have all these 0:11:28.080 --> 0:11:30.660 other new entrants nipping at our heels, and we can't 0:11:30.700 --> 0:11:33.020 really do anything to let them take our share. And 0:11:33.059 --> 0:11:37.179 you do have new studios. There's one, an independent called A24. 0:11:37.480 --> 0:11:39.940 You have Apple making movies. You have the combined Amazon 0:11:40.020 --> 0:11:42.910 MGM making some new movies. So they had a decent 0:11:43.030 --> 0:11:45.650 argument that we have some new entry. So court, you 0:11:45.670 --> 0:11:48.150 really shouldn't even pay much attention to these static market 0:11:48.170 --> 0:11:50.960 shares because they're not going to be the picture in 0:11:50.980 --> 0:11:52.460 a year from now or two years from now as 0:11:52.500 --> 0:11:55.480 these other studios continue to make movies. And so I 0:11:55.540 --> 0:11:57.960 think that what the states had was a good enough 0:11:58.000 --> 0:12:00.750 case for that complaint and a good enough case to 0:12:00.780 --> 0:12:03.730 get their temporary restraining order. But I view it as fragile. 0:12:03.910 --> 0:12:05.209 That's how I like to think about it. Kind of 0:12:05.390 --> 0:12:08.260 easy to poke holes in. once Paramount got into court. 0:12:08.559 --> 0:12:10.900 There was a lot of pressure to let this deal 0:12:10.940 --> 0:12:15.020 go through on the federal level. I mean, Ellison, father 0:12:15.070 --> 0:12:18.809 and son, very close to Trump. There was lobbying there. 0:12:19.370 --> 0:12:23.590 And we saw what happened with the Live Nation antitrust case, 0:12:23.690 --> 0:12:27.430 where it fell apart when trial had already started because 0:12:27.490 --> 0:12:31.970 of a deal made in D.C. So in a different administration, 0:12:32.010 --> 0:12:34.350 do you think that the feds would have challenged this? 0:12:34.390 --> 0:12:34.610 Yes. 0:12:35.140 --> 0:12:37.059 Yes, I heard rumors. I don't know if they're true 0:12:37.120 --> 0:12:39.550 or not, or reports that there were DOJ staffers. And, 0:12:39.559 --> 0:12:41.300 you know, the staffers tend to be there a long time. 0:12:41.660 --> 0:12:45.670 They're not necessarily politically affiliate, you know, they're neutral politically, 0:12:46.010 --> 0:12:48.230 that the staffers were opposed to this. And it was 0:12:48.510 --> 0:12:50.690 the decision was made over their head to settle. I 0:12:50.770 --> 0:12:53.570 do think in a different, particularly if it had been 0:12:53.590 --> 0:12:56.689 the previous Biden administration, that there probably would have been either, 0:12:57.210 --> 0:12:59.729 you know, a challenge that was settled with a stronger 0:12:59.770 --> 0:13:02.800 settlement than this. I think they would have demanded some divestiture, 0:13:03.100 --> 0:13:06.210 particularly of some cable channels. Or they would have actually 0:13:06.270 --> 0:13:07.560 gone to court to try to block it. 0:13:07.970 --> 0:13:13.070 They're paying so much. There's investments from outside groups. Is 0:13:13.110 --> 0:13:15.370 this deal going to be profitable for them? 0:13:15.710 --> 0:13:18.010 Well, that's the big question now. And I think you'll 0:13:18.030 --> 0:13:20.670 have to talk to my colleague, Geetha Rankin-Nathan, about that, 0:13:20.710 --> 0:13:23.110 who's an expert in these companies and these industries. I 0:13:23.150 --> 0:13:27.130 will say this, that those assets, the Time Warner assets, 0:13:27.170 --> 0:13:30.679 have a checkered history in terms of their acquisitions. and success. 0:13:30.780 --> 0:13:33.420 Those assets, the Warner Brothers assets, have been bought and 0:13:33.460 --> 0:13:36.730 sold numerous times, and the buyers have not had success. 0:13:37.170 --> 0:13:39.130 And the craziest thing is that this is such a 0:13:39.210 --> 0:13:42.290 full circle case, June, because the last time those assets 0:13:42.309 --> 0:13:45.470 were sold was when AT & T acquired Time Warner, 0:13:45.890 --> 0:13:48.770 and the Department of Justice went to court to try 0:13:48.809 --> 0:13:51.460 to challenge that. And the Assistant Attorney General in charge 0:13:51.480 --> 0:13:54.140 of antitrust that challenged the deal was Makan Delrahim, who 0:13:54.200 --> 0:13:57.059 is now the General Counsel at Paramount that guided this through. 0:13:57.500 --> 0:14:00.220 And at the time, he went to court- against AT & 0:13:59.820 --> 0:14:03.720 T and Tom Warner because he insisted that they divest CNN. 0:14:04.179 --> 0:14:07.160 And they said, no, we won't do that. And AT & 0:14:06.580 --> 0:14:09.260 T won in court. Now, sadly for them, they did 0:14:09.300 --> 0:14:11.760 not make a success of it with these assets, as 0:14:11.820 --> 0:14:14.020 has been the history. I'll sort of think of them 0:14:14.100 --> 0:14:16.500 as cursed. But it's interesting to me that he's come 0:14:16.540 --> 0:14:20.540 back around to be involved again in the control of CNN. 0:14:21.110 --> 0:14:24.010 So tell me this. We've talked about this before, but 0:14:24.410 --> 0:14:28.550 how is the Trump administration– in the antitrust area, are 0:14:28.570 --> 0:14:32.310 they being any more aggressive than last time? It doesn't 0:14:32.350 --> 0:14:33.120 seem like it. 0:14:33.480 --> 0:14:33.820 No. 0:14:34.420 --> 0:14:36.440 The answer would be no. And I can give you 0:14:36.500 --> 0:14:39.760 some data that backs that up. So far in 2026, 0:14:39.760 --> 0:14:41.880 as we come into the fourth quarter, there has been 0:14:41.920 --> 0:14:44.920 not one single challenge without a simultaneous settlement to a 0:14:44.960 --> 0:14:47.040 deal by the Department of Justice. I don't even know 0:14:47.070 --> 0:14:49.650 if there's been one by the FTC. Trump's FTC has 0:14:49.710 --> 0:14:53.090 challenged a few small health care deals and one deal 0:14:53.270 --> 0:14:58.670 related to do-it-yourself adhesive for constructions. Gorilla Glue. Oh, really? 0:14:58.710 --> 0:14:58.890 Right. 0:14:59.010 --> 0:14:59.970 Okay. Now I get it. 0:15:00.120 --> 0:15:01.820 Yes. I have it at home. Right. 0:15:02.620 --> 0:15:05.800 So there have been very few challenges across the board 0:15:06.320 --> 0:15:10.000 since the Trump administration enforcers took over by both the 0:15:10.080 --> 0:15:12.680 FTC and DOJ. But really what's glaring is this year, 0:15:12.740 --> 0:15:15.110 nothing at all by the Department of Justice. So when 0:15:15.140 --> 0:15:17.090 you look at it that way, it's a very business 0:15:17.150 --> 0:15:21.310 friendly enforcement era that we're in on the M & 0:15:20.990 --> 0:15:23.910 A side right now. And, you know, they're beginning also 0:15:23.950 --> 0:15:26.560 to settle some of the monopolization suits as well. that 0:15:26.600 --> 0:15:28.900 were existing that they inherited when they took over. And 0:15:28.920 --> 0:15:31.540 I think we'll probably see a settlement of a suit 0:15:31.620 --> 0:15:34.020 that's been running for a few years now against Apple. 0:15:34.360 --> 0:15:37.479 We may see a settlement of an FTC suit against Amazon. 0:15:37.560 --> 0:15:40.280 I'm just guessing. I'm not talking in the near term, 0:15:40.320 --> 0:15:42.580 but in the longer term, the ones that are left 0:15:42.720 --> 0:15:45.730 over that were started by the Biden administration. 0:15:46.450 --> 0:15:50.590 So the effort goes into settlements instead of bringing new cases. 0:15:50.810 --> 0:15:53.010 Thanks so much, Jen. It's great to have you on again. 0:15:53.640 --> 0:15:58.090 That's Bloomberg Intelligence Senior Litigation Analyst Jennifer Rhee. Turning to 0:15:58.120 --> 0:16:03.050 environmental law news, the Trump administration has announced rule changes 0:16:03.390 --> 0:16:08.370 that will effectively erase efforts undertaken by Presidents Barack Obama 0:16:08.430 --> 0:16:13.190 and Joe Biden to address climate change. EPA Administrator Lee 0:16:13.230 --> 0:16:18.290 Zeldin announced the agency is repealing rules that limit planet-warming 0:16:18.350 --> 0:16:23.160 greenhouse gas emissions from coal and gas-fired power plants. one 0:16:23.180 --> 0:16:26.930 of its most aggressive moves so far to unwind U.S. 0:16:26.990 --> 0:16:28.610 environmental regulations. 0:16:29.630 --> 0:16:32.610 It means providing companies that choose to invest in America 0:16:32.630 --> 0:16:36.250 with the certainty that their work will pay off and 0:16:36.270 --> 0:16:40.220 their money won't get tied up in unnecessary, burdensome regulatory battles. 0:16:40.970 --> 0:16:44.400 The EPA says removing the rule will save power plants 0:16:44.560 --> 0:16:48.900 more than $ 300 billion in costs. It also estimates it 0:16:48.940 --> 0:16:53.880 will result in an additional 533 million metric tons of 0:16:54.020 --> 0:16:59.790 carbon dioxide emissions by 2040. This follows the agency's axing 0:16:59.850 --> 0:17:04.670 in February similar EPA climate standards for cars and trucks, 0:17:05.150 --> 0:17:08.609 another major source of emissions, and the reversal of the 0:17:08.710 --> 0:17:12.800 legal underpinning for those rules, known as the endangerment finding. 0:17:13.220 --> 0:17:17.100 Joining me is environmental law expert Pat Parenteau, a professor 0:17:17.140 --> 0:17:20.840 at the Vermont Law and Graduate School. Pat, where do 0:17:20.859 --> 0:17:24.060 we stand with the EPA repealing these rules? 0:17:25.000 --> 0:17:30.100 So this is the second shoe to drop following EPA's 0:17:30.540 --> 0:17:34.990 repeal of the endangerment finding, which, of course, as we've talked, 0:17:35.150 --> 0:17:39.609 undergirds all of the regulation of greenhouse gas emissions from 0:17:39.869 --> 0:17:43.350 every source, you know, mobile sources, cars and trucks, but 0:17:43.390 --> 0:17:48.669 also stationary sources, power plants, etc. So they've already repealed 0:17:49.030 --> 0:17:53.600 the tailpipe emission standards for cars and trucks. And now 0:17:53.760 --> 0:17:59.860 they've repealed the greenhouse gas controls for power plants. And 0:17:59.980 --> 0:18:05.070 in addition to repealing the Biden administration rules for power plants, 0:18:05.650 --> 0:18:13.630 they've also initiated another rulemaking to completely eradicate greenhouse gas 0:18:13.690 --> 0:18:15.850 emissions from the Clean Air Act. So this is a 0:18:15.890 --> 0:18:18.990 two-step kind of process that they're engaged in, but all 0:18:19.010 --> 0:18:23.490 of it is premised on their argument that, in fact, 0:18:23.670 --> 0:18:28.889 EPA lacks authority to regulate greenhouse gas emissions under the 0:18:28.950 --> 0:18:32.540 Clean Air Act. So You know, that's what they're going for. 0:18:32.619 --> 0:18:35.659 What they want is a case to get back to 0:18:35.680 --> 0:18:40.550 the U.S. Supreme Court and have the court review its 0:18:40.650 --> 0:18:45.889 ruling in the landmark Massachusetts v. EPA case and either 0:18:45.990 --> 0:18:50.260 overturn it completely or at least revise it to the 0:18:50.320 --> 0:18:55.100 point where it agrees with EPA now that EPA doesn't 0:18:55.119 --> 0:18:58.260 have the authority to regulate these emissions. So that's kind 0:18:58.280 --> 0:18:58.820 of where we are. 0:18:59.150 --> 0:19:02.670 So if EPA doesn't have the authority to regulate greenhouse 0:19:02.710 --> 0:19:06.060 gas emissions, then which agency has the authority? 0:19:06.560 --> 0:19:10.600 Well, no federal agency would. The question would be, does 0:19:10.619 --> 0:19:14.540 that open the door to state regulation? And the answer 0:19:14.580 --> 0:19:17.240 would be, yes, it would. I mean, to the extent 0:19:17.280 --> 0:19:21.480 that some states, like California, of course, and others, might 0:19:21.520 --> 0:19:24.429 be willing to step in and try to fill the gap. 0:19:24.750 --> 0:19:28.310 But that's not the kind of program... that would be successful. 0:19:28.369 --> 0:19:30.969 You don't want to leave it up to individual states 0:19:31.010 --> 0:19:34.010 to decide whether they're going to regulate, and if so, 0:19:34.290 --> 0:19:37.520 to what extent they're going to regulate. That will defeat 0:19:38.340 --> 0:19:45.810 a coordinated, comprehensive, intelligent way of transitioning away from fossil 0:19:45.850 --> 0:19:48.610 fuels to cleaner sources of energy, which is what we need. 0:19:49.800 --> 0:19:52.640 So the point of this rule revocation is to save 0:19:53.240 --> 0:19:55.140 coal and natural gas plants? 0:19:55.940 --> 0:19:59.620 Yeah, it's primarily coal. Gas plants don't have as much 0:19:59.760 --> 0:20:05.850 trouble meeting emission standards, frankly. The state-of-the-art gas plants, they 0:20:05.910 --> 0:20:11.489 could definitely benefit from some carbon capture and sequestration, but 0:20:11.530 --> 0:20:15.649 it's really the coal plants that the Trump administration is 0:20:15.690 --> 0:20:18.800 trying to salvage. And of course, they ordered through the 0:20:18.840 --> 0:20:23.120 Department of Energy, the Trump administration ordered old power plants 0:20:23.900 --> 0:20:27.260 in Michigan to keep operating, even though the utilities wanted 0:20:27.300 --> 0:20:30.460 to shut them down because they're not cost effective, right? 0:20:30.940 --> 0:20:35.409 So the first part of what EPA has done is 0:20:35.450 --> 0:20:39.570 to say, we don't believe that CCS, carbon- capture and 0:20:39.670 --> 0:20:46.109 storage is a viable technology. Now, that's, of course, contradicted 0:20:46.510 --> 0:20:51.850 by the industry itself, which has been using CCS for decades. 0:20:52.410 --> 0:20:55.510 They use it to capture the carbon so that they 0:20:55.550 --> 0:21:01.520 can inject it into oil and gas formations to recover 0:21:01.820 --> 0:21:05.300 what they call secondary recovery of oil and gas. So 0:21:05.580 --> 0:21:10.859 we know that CCS works There is a question about 0:21:10.920 --> 0:21:15.490 whether it's, quote, ready for prime time. The Biden administration, 0:21:15.750 --> 0:21:20.930 you know, required 90 percent capture of carbon emissions from 0:21:21.109 --> 0:21:24.350 coal plants. But they gave the Biden administration gave the 0:21:24.450 --> 0:21:29.570 utilities until 2032 to figure out how to do that. So, 0:21:29.950 --> 0:21:33.710 I mean, there is a legitimate question under the terms 0:21:34.170 --> 0:21:38.510 of the Clean Air Act, which requires adequate demonstration of 0:21:38.910 --> 0:21:43.469 of control technologies, there is a question about whether 90% 0:21:43.470 --> 0:21:49.220 capture and storage is commercially feasible. But, you know, if 0:21:49.280 --> 0:21:53.200 it isn't 90%, is it 50%? Because even that would 0:21:53.240 --> 0:21:57.560 be useful, right? So the legal question on the immediate 0:21:57.700 --> 0:22:02.000 repeal of the greenhouse gas regulations of power plants is 0:22:02.020 --> 0:22:05.720 going to turn on a technical determination by the courts. 0:22:06.480 --> 0:22:11.510 Is CCS really a viable, achievable technology right now. 0:22:12.130 --> 0:22:16.810 Is the EPA actually arguing that greenhouse gases from power 0:22:16.869 --> 0:22:21.030 plants don't endanger human health or the environment? 0:22:21.690 --> 0:22:25.270 Yeah, they've already said that with regard to emissions from 0:22:25.609 --> 0:22:29.900 cars and trucks. So there's another technical question about whether 0:22:29.920 --> 0:22:34.570 that finding is applies also to stationary sources like power plants. 0:22:34.670 --> 0:22:38.590 But the bottom line is the Trump administration and Zeldin 0:22:38.630 --> 0:22:44.689