Khaberni - The digital streaming giant Netflix faces an unprecedented political and legal storm, where direct threat language from the White House has intertwined with judicial movements from the US Department of Justice, threatening to hinder one of the biggest acquisition deals in entertainment history amidst accusations of "conflict of interest" and politicization of economic laws.
Direct threat from Trump
The scene escalated when US President Donald Trump demanded Netflix fire board member Susan Rice, waving “severe consequences” if they failed to comply.
This attack came after comments by Rice, former National Security Advisor under Obama and former official in the Biden administration, who warned companies that "appease" Trump of potential future accountability if Democrats return to power, asserting that "the old game rules have changed."
Susan Rice returned to the forefront of controversy after rejoining the Netflix board in 2023, at a time when the company is fiercely competing with Paramount Skydance over the acquisition of Warner Bros. Discovery, a deal which could significantly alter the balance of power in the global streaming and entertainment market.
Although Trump did not specify the nature of the “consequences” he alluded to, the context of his threat was linked to increasing political pressure on media companies, especially following comments by the Federal Communications Commission Chairman Brendan Carr, who hinted at the potential threat to the licenses of media networks because of content displeasing to authorities.
“Antitrust” investigations
In a dramatic development coinciding with these threats, reports revealed that the US Department of Justice, headed by Attorney General Pam Bondi, began a comprehensive federal investigation into Netflix's influence in the entertainment industry.
Omid Asifi, Acting Head of the Antitrust Division, sent formal notices to filmmakers and producers in Hollywood, demanding them to submit sworn affidavits and official documents by no later than March 23.
The timing of this investigation raises fundamental questions; it comes just three days before the scheduled shareholder meeting of Warner Bros Discovery to ratify the acquisition deal led by Netflix, amid a peak in the bidding war with David Ellison’s owned Paramount Skydance.
The legal trajectory of the investigations
The federal investigation is based on civil antitrust law, specifically Section 7 of the "Clayton Act" and Section 2 of the "Sherman Act."
The authorities aim to determine if Netflix's acquisition of Warner Bros Discovery would lead to a reduction in competition or create a monopoly situation, particularly as Section 2 of the "Sherman Act" imposes severe penalties for monopolistic practices, which could amount to fines of up to $100 million for companies, and imprisonment for up to 10 years for individuals involved.
On his part, David Hyman, the legal representative for Netflix, refuted these accusations, describing them as baseless and affirming that the company's success relies on innovation and not exclusionary conduct.
In a direct and concise message to his competitor David Ellison, Ted Sarandos, Co-CEO of Netflix, said: “Just put a better offer on the table and see if you can win.”
The outlook of the conflict.. Will it rein in the Netflix empire?
Observers believe that this confrontation goes beyond the limits of business deals to reveal an increasing gap between Silicon Valley and the White House; while economic circles anticipate March 23, analysts see that the intertwining of federal investigations with direct political pressures could turn Netflix into a model for how state tools can be used to undermine the influence of major companies.
Experts also asserted that whether the deal succeeds or stumbles under the weight of the laws, the message to Hollywood is clear, and that is "political loyalties" may soon become an item as important as financial solvency in the balances of acquisitions and mergers.
