Paramount and Warner Bros. Discovery executives reportedly fear a US judge could temporarily block their US$111 billion (A$170 billion) merger within days, delaying the deal as a costly deadline approaches.

A federal court in California is scheduled to hear a request on Friday from 12 US state attorneys general seeking a temporary restraining order against the transaction.

People close to the companies reportedly expect the order could be granted, potentially preventing the merger from closing for at least two to three weeks.

Paramount had been targeting a completion as early as next week but has now abandoned its July 22 goal, while maintaining it expects the takeover to close by the end of September.

A delay beyond September 30 would trigger a “ticking fee” estimated at about US$650 million for every quarter the deal remains incomplete, or approximately US$6.9 million a day.

The states, led by California Attorney General Rob Bonta, argue the combination would reduce competition, increase prices and harm cinemas, cable distributors and audiences.

As reported earlier this week, Paramount has dismissed the lawsuit as “fundamentally flawed” and accused the states of protecting Netflix and other technology giants from greater competition.

The merged company would bring Warner Bros., HBO, CNN, Discovery, CBS, Paramount+, HBO Max and Paramount Pictures under the same corporate umbrella.

It would also determine the future ownership of Australia’s Network 10 and 10 Play, which are currently controlled by Paramount.

Paramount has rejected the states’ claims, arguing the merger is needed to compete against technology and streaming giants including Netflix, Amazon and Apple.

The company has committed to releasing at least 30 films annually, maintaining 45-day cinema windows and operating Paramount and Warner Bros. as separate film studios.

The proposed takeover is also facing lawsuits from the Writers Guild of America, Paramount+ subscribers and Paramount shareholders.

The WGA claims the merger would remove a major buyer of television and film projects, reducing employment opportunities and giving the combined company greater power to suppress writers’ wages.

Paramount’s lead lawyer Jeffrey Kessler said the company would appeal if the court granted the restraining order and was prepared to take the dispute as far as the US Supreme Court.

The deal has already received approval from the US Justice Department and Australia’s competition regulator, although reviews remain underway in the UK and Europe.