It’s a high-stakes game of Hollywood chicken. 

It appears Rob Bonta called David Ellison’s bluff this week when the CEO of Paramount Skydance reportedly back-channelled a threat to the California Attorney General’s office — and the Los Angeles Mayor’s office — that he’d officially announce Paramount’s move out of California, regardless of a settlement in the ongoing antitrust case.

“Mayor Bass is taking [Paramount’s threat] seriously, Governor Newsom is taking it semi-seriously. But Bonta believes he has a relatively strong anti-trust case,” said a knowledgeable source. “And while Bonta would rather settle, he’s also willing to go to trial — and he also thinks that Ellison is acting a little crazy.”

On Wednesday, TMZ reported that Paramount notified Bonta and Bass that the studio was imminently announcing its intention to leave California. But no announcement has, at least so far, been made. (Paramount is not commenting.)

But TMZ then walked back its original story, saying talks were still ongoing. Making the move messier, a court-supervised settlement conference between the parties is already scheduled for October 14 and 15.

“David is used to getting his way and I think he’s so angry and frustrated right now that he could be saying, ‘I’m going to show them and I’m going to punish them because no one thinks I will do this,’” said a source.

Bonta’s office would not confirm or deny whether settlement talks are occurring. “It’s no secret that Paramount has been making this threat, despite its alleged commitment to California and Hollywood,” read a statement to P6H yesterday. “What Paramount decides to do is Paramount’s choice alone. We’ll continue to apply the law without fear or favor and continue to be open to coming to the table for good faith discussions.”

As the clock ticks down, one showbiz pro half-jokingly told us yesterday of the California quandary. “You know the perfect person who should be in power in this situation? Arnold Schwarzenegger. He’s the former governor, he’s a movie star. It’s a dereliction of a lot of peoples’ duty [if] California can’t find a way for this to work. All bets are off for what comes next. The adults at the table really need to step up.”

Bonta has indicated he’s open to talks, but said any resolution would require “robust structural remedies.”

According to several sources, Bonta’s main conditions are keeping Paramount and Warners independent from one another for a period of time, and ensuring they are actually competitive. The other major condition is that Paramount and Warner Bros. cable assets would not merge.

Beyond the shockwaves created by TMZ’s bombshell report, top showbiz execs were unfazed by the news of Paramount’s alleged exodus. “It’s all negotiations and positioning… meaningless,” huffed one veteran entertainment CEO. Another showbiz vet said of Paramount’s latest threat: “Not going to happen. They’re about to go into settlement talks. This has to be a BS thing for Bonta.”

Either way, Wednesday’s headlines pulled Bass further into the fray as the Paramount suit becomes a hot-button issue in LA’s mayoral race.

Bass’ upcoming mayoral challenger, Nithya Raman, opposes the Paramount-WBD merger, and thinks the case should be decided in court. But Bass has called for a “swift and urgent resolution” to the dispute.

One top political strategist told us of the political fallout from Paramount’s potential move: “If [Paramount] really was to leave, the repercussions are almost incalculable. There would be a ripple effect [beyond studio jobs] to craft services, florists, drivers, everybody. The AG is not playing ball and is resistant. [Bass and Newsom] would like to see this all taken care of for all the obvious reasons. Who wants to lose a studio to another state?”

But, “This isn’t a Karen Bass problem. It’s much bigger than that,” said the insider. 

Local showbiz watchers have been wondering what happens to the famed Paramount lot if the studio leaves. “You know who’s gonna buy the lot? OnlyFans,” a source joked, (we think?). “They only made about a billion more than Hollywood last year. It can be our version of Dollywood.”

The latest drama is set against the backdrop of imminent court-ordered settlement talks, after Bonta dramatically pulled the plug on a meeting last month and accused Paramount of “playing games” by leaking details of the talks. Paramount previously shot back in a statement: “As we have assured the Attorney General’s office, Paramount has not been the source of the leaks of any of our confidential discussions with the AG’s office. We remain hopeful and stand ready to continue good faith discussions to resolve the attorneys general suit and move forward with our plans for increased competition and increased output to the benefit of the talent and entertainment workers.”

Ellison has already received an entreaty from Tennessee’s Deputy Governor to consider moving his studio there, and had conversations with top Texas pols, including attorney general and Senate hopeful Ken Paxton, sources previously told us. The reports had some of the combined studios’ 7,500 L.A.-based staffers eyeing Zillow for homes in Nashville and Austin. 

But long before Bonta’s lawsuit was filed in June, Ellison’s dad, Oracle billionaire Larry Ellison, had discussed moving Paramount out of state with his top aides and pals. The tech mogul previously moved his own primary residence out of California to Hawaii and shifted Oracle’s corporate base from Silicon Valley to Texas, with a large corporate campus in Austin. In 2024, Larry announced Oracle was moving its world headquarters to Nashville.

Bass, in responding to a separate Variety story on the matter, wrote on X: “I will continue to engage with Paramount, Attorney General Bonta, and entertainment leaders to keep jobs in LA. This industry was built here. Its workers are here. I’m going to fight like hell to keep it here.”