A federal judge today ordered Paramount Skydance and Warner Bros. Discovery to halt their $111 billion merger, handing an early win to states that sued to block the deal. The ruling granted a temporary restraining order prohibiting the firms from completing the merger and from consolidating their operations.

The temporary order is only in effect for 14 days, but it can be converted into a preliminary injunction that would prevent the merger from being completed until the case is resolved. The temporary restraining order can be extended past the 14-day period if more time is needed to rule on a preliminary injunction.

A group of 12 states led by California sued the companies last week in an attempt to block the deal, which had been approved by the Trump administration. The states say the merger will eliminate competition by combining two of the five major Hollywood movie studios, and two of the five major owners of basic cable TV channels.

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California can keep enforcing rules that require AT&T to offer basic phone service to new customers in its wireline territory, following a federal judge's ruling last week.

AT&T sued California in May in a bid to end the state's Carrier of Last Resort (COLR) rules that require it to offer telephone service to any potential customer in its territory. AT&T asked for a preliminary injunction that would prevent California from enforcing the COLR rules while the litigation continues.

To win a preliminary injunction, AT&T had to show it is likely to succeed on the merits of its claim that California rules are preempted by a Federal Communications Commission order. US District Judge Linda Lopez denied AT&T's request for a preliminary injunction during a motion hearing on Thursday, according to a docket entry. The case is in US District Court for the Southern District of California.

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