According to The Hollywood Reporter, Paramount may leave California due to possible litigation by the state’s attorney general. The lawsuit is related to the $111 billion merger between Warner Bros. Discovery and Paramount.

Reportedly, “friends and advisers” have been pushing Larry Ellison to headquarter the company outside of the Golden State. Although the potential lawsuit is coming from a coalition of states, California is leading the charge. The lawsuit claims that the merger will harm competition in major markets. If Paramount moves, California would lose out on $ 30 million in planned spending. 

Paramount has not made a final decision on a location change. The company leased facilities in New Jersey last year. They will have 285,000 square feet in New Jersey for 10 years.

Paramount believes that the merger would actually be beneficial for competition. Paramount has stated that acquiring Warner is necessary for it to compete with the deep-pocketed tech companies such as Amazon, Netflix, and Apple.

The lawsuit could be filed as early as this week. If everything goes well for Paramount, the deal is expected to be closed in Q3 of this year. 

“We continue to engage constructively with the remaining few regulators around the world still considering the merger, including State Attorneys General, and are prepared to address any legitimate antitrust issues. We are confident this transaction raises no such concerns, as demonstrated by the dozens of antitrust authorities around the world that have carefully reviewed the transaction,” Paramount told Semafor according to The Hollywood Reporter.

The California-led lawsuit is just one of the hurdles that Paramount has to pass, although they have received good news as of late. Last month, news surfaced that the European Commission is planning to approve the deal after a lengthy investigation.

“We have been engaged with all regulatory and law enforcement bodies in a constructive and transparent manner and will continue to do so,” a Paramount spokesperson said last month per The Hollywood Reporter.