Attempts to settle President Trump’s $20 billion lawsuit against CBS are getting even more complicated for its parent company, Paramount Global, as Democrats in California’s state senate are launching an investigation into a potential deal and whether it could be considered a bribe. 

Mr. Trump is suing CBS over how CBS News producers edited Vice President Harris’s October 2024 interview with “60 Minutes.” The controversial edit, only discovered after CBS released alternative versions of the interview on lesser platforms, removed a “word salad” from the beginning of her answer to a question about Israel. Executives at Paramount reportedly believe that settling the lawsuit will pave the way for the Federal Communications Commission to approve its merger with Skydance Media. 

The California senate’s energy, utilities, and communication committee and the judiciary committee sent a letter to a former CEO of CBS News and Stations, Wendy McMahon, who was forced out last month, and a former executive producer of “60 Minutes,” Bill Owens, who was forced out in April, inviting them to testify as part of an investigation into a potential settlement.

“Your recent resignations from CBS’s leadership, amid public reports of internal concern about the editorial and ethical implications of the proposed settlement, suggest that you may possess important, first-hand knowledge relevant to our legislative oversight responsibilities,” the letter said. 

The Democratic lawmakers noted published reports that executives at Paramount think that settling the lawsuit would pave the way for the FCC to approve Paramount Global’s acquisition by Skydance Media, which is considered vital to saving the studio and to the bottom line of the Redstone family, which controls Paramount.

 The Trump-appointed chairman of the FCC, Brendan Carr, says the lawsuit is unrelated to his agency’s review of the merger. However, the agency is conducting a “news distortion” investigation of the Harris interview, which he said could factor into the review process. Paramount executives reportedly believe that despite Mr. Carr’s comments, Mr. Trump’s lawsuit, which runs parallel to the news distortion probe, needs to be resolved before the merger happens. Paramount is facing a July 6 deadline to close the merger or it could owe Skydance a $400 million breakup fee.

“Perhaps even more concerning is the potential chilling effect of Paramount’s settlement on investigative and political journalism. Such a settlement would signal that politically motivated lawsuits can succeed when paired with regulatory threats,” the letter said. “It would damage public trust in CBS News and other California-based outlets, diminishing the state’s stature as a national leader in ethical journalism.”

The state senators warn a settlement could violate federal anti-bribery laws and California’s Unfair Competition Law.

“This is a voluntary request. You are being approached as friendly witnesses who may help our committees assess whether improper influence is being exerted in ways that threaten public trust and competition in the media sector,” the letter said. “This hearing will mark the beginning of our inquiry.”

Specifically, the letter asks for information about whether anyone in the newsroom voiced objections to a potential settlement, if “editorial decisions were impacted or overridden,” if “counsel or leadership acknowledged the weakness of the lawsuit’s claims,” or if anyone at CBS “indicated” that a settlement may be “advantageous or necessary in order to influence the regulatory review of the merger.”

Representatives for CBS and Paramount did not respond to the Sun’s request for comment by the time of publication. 

The letter comes as Paramount and Mr. Trump’s legal team have been negotiating a potential settlement with seemingly little progress. Attorneys for Paramount offered the president $15 million, the Wall Street Journal reported. A veteran media reporter, Matthew Belloni, reported that Mr. Trump’s team demanded $50 million in a “take-it-or-leave-it situation.”

The president’s team is also believed to be pushing for an on-air apology for the Harris interview. The New York Post’s Charles Gasparino reported that there could be another condition of a settlement: requiring CBS News to air public service announcements for causes important to the Trump administration, such as the rise of antisemitism or supporting American veterans. CBS News, including “60 Minutes,” has been under fire in recent months for anti-Israel content and editorial policies.

The prospect of a settlement has roiled the reliably liberal news division at CBS, which has defended the editing of the Harris interview. CBS attorneys have tried to get the case dismissed. However, despite New York and Washington legal analysts dismissing the lawsuit, in news reports, as “frivolous” and “easily winnable,”  the conservative, Texas-based judge presiding over the case has allowed the suit to move forward. Ms. McMahon and Mr. Owens were reportedly staunch opponents of a settlement and had set a “red line” over an apology.

As the legal battle dragged on, “60 Minutes” ran weekly, one-sided anti-Trump segments criticizing Mr. Trump’s policies. The non-executive chairwoman of Paramount, Shari Redstone, reportedly asked if “60 Minutes” could hold off on running more stories about the Trump administration until the Skydance deal was approved. Ms. Redstone had also expressed frustration with what she felt was an anti-Israel bias in the newsmagazine program’s coverage of the Israel-Hamas war. 

In Mr. Owens’s resignation memo, he stated he had lost the ability to make “independent decisions” for “60 Minutes.” One of the show’s main hosts, Scott Pelley, in a remarkable on-air appearance after Mr. Owens’s ouster, blamed the merger for the situation but told viewers that Paramount had not blocked any of its stories, yet. However, during a recent interview with “The New Yorker Radio Hour,” host Lesley Stahl told the far-left editor David Remnick that Mr. Owens was being asked to “either not run pieces or to change parts of the stories.”

When Ms. McMahon resigned, she stated it was because she did not agree with her bosses on the “path forward.” Puck’s Dylan Byers reported that she was “fired” because of her bosses’ displeasure with her job performance in various areas — not just her opposition to a settlement — but was allowed to resign to save face. 

The ouster of Ms. McMahon and Mr. Owens seemed to signal that a settlement could be coming soon. Ms. Stahl told the New Yorker that she believed a settlement is inevitable after their departures, as they were standing up to the top brass. 

However, even without the two dissenters at CBS, a settlement could take some time, as executives at Paramount are reportedly starting to get nervous about the allegations it would constitute a bribe and expose them to legal perils.

Last month, three powerful, liberal Democrats, Senators Sanders, Warren, and Wyden, sent a letter to Paramount warning that a settlement could violate federal anti-bribery laws. Meanwhile, the Freedom of the Press Foundation said it would sue Paramount if it settles. 

It’s unclear if the pressure campaign from Democratic lawmakers and other left-wing groups will sink the chances of a settlement. However, it could factor into negotiations and force Mr. Trump to accept a lower amount — in line with what other companies have paid him — to try to avoid the appearance of a bribe.

In December, Disney paid Mr. Trump $16 million after host George Stephanopoulos falsely and repeatedly said the president had been “found liable for rape.” Mr. Belloni said the case was winnable for Disney, as the president’s team would have to show Mr. Stephanopoulos met the high bar of “actual malice” to win. However, the case, filed in a Florida court, was heading to the deposition phase, and the settlement was seen as an attempt to avoid potentially bruising legal battles with the new administration as well as to avoid embarrassing disclosures about Mr. Stephanopoulos during the discovery process. 

Amid the threats of lawsuits and investigations, Paramount’s board is concerned that its Directors and Officers liability insurance would not cover its potential legal fees, Mr. Gasparino reported. That type of liability insurance does not usually cover legal expenses when the charges or lawsuits involve bribery allegations.