Investing.com -- A coalition of states led by California secured a pause on Monday of Paramount’s planned $110 billion acquisition of Warner Bros. Discovery after arguing the merger would cause irreparable harm to competition.

California and 11 other states filed a lawsuit on July 13, claiming the transaction would create a media company with the power to raise prices in film and television.

The states argued that allowing the deal to close would lead Paramount to begin cutting jobs and sharing sensitive information with Warner Bros. Discovery, actions that would be difficult to reverse if the merger is later determined to be illegal.

The lawsuit was filed in Oakland federal court and poses a threat to Paramount CEO David Ellison’s plan to transform his company into a competitor to Netflix and Disney.

Paramount has stated the lawsuit misrepresents established antitrust law and that delaying the transaction would harm entertainment workers who have already faced years of industry disruption.

Paramount Skydance shares traded roughly 1.7% lower following the announcement. Warner Bros. Discovery declined about 1.2%.