Paramount Files Countersuit Against Warner Bros. Discovery In Their Ongoing Battle Over ‘South Park’ Streaming Rights

Two months after being sued for $200 million by Warner Bros. Discovery (WBD) over South Park streaming rights, Paramount has fired back with a $52 million countersuit of its own.

WBD is arguing that Paramount was engaged in an “illicit conspiracy” and used “verbal trickery” to get around a $500 million deal the companies agreed to in 2019, while Paramount says it’s given WBD’s streamer HBO Max everything that was guaranteed in the deal and its time for Warner to pay up.

Context: We covered Warners’ suit at the time it was filed in a story that can be found here, but here’s a quick recap. Back in February, WBD sued Paramount, alleging that the company, South Park Digital Studios (SPDS), and MTV Entertainment had colluded to find a way around a 2019 streaming contract worth $500 million. WBD says that the companies used “verbal trickery designed to circumvent the terms of the 2019 agreement” by using “grammatical sleight-of-hand, characterizing new content as ‘movies,’ ‘films,’ or ‘events’ to side-step SPDS’s contractual obligations” to HBO Max. By reclassifying new South Park content, WBD argued, Paramount was allowed to keep it exclusive on its own Paramount+ streaming platform.

What’s happening now? On Wednesday of this week, Paramount filed a counterclaim with the New York Supreme Court that argues that HBO Max got everything it was owed under the agreement but has withheld two required payments of $26 million.

What does Paramount want? According to the complaint, South Park Studios is looking to recover all the unpaid license fees, totaling more than $52 million. The document continues, “In addition, based on WarnerMedia’s material breaches of contract, and its indications that it will continue to withhold the $225+ million in license fees still owed for the rest of the five-year term, South Park Studios is entitled to a declaratory judgment confirming the parties’ rights and obligations under the Term Sheet.” In other words, they want WBD to keep making the payments from the 2019 deal.

What’s Paramount saying? In a statement, a Paramount Global spokesperson said:

Warner Bros. Discovery has indefensibly refused to pay the more than $50 million it owes for South Park content that it has undisputedly received and which HBO Max continues to air and exploit. Warner Bros. Discovery’s argument that Paramount Global was required to deliver additional South Park content is baseless and wholly unsupported by the parties’ agreement. Furthermore, it certainly does not justify WBD’s refusal to pay for immensely valuable content all of which it has received and from which it continues to profit.