Paramount Skydance is in advanced talks with California AG Rob Bonta over his suit to block the media giant's $81 billion deal to buy Warner Bros. Discovery. The two sides have discussed compromises like having Paramount operate it and WBD's studios separately for a while instead of combining them right away, the Wall Street Journal reported Friday.

The negotiations come after Paramount CEO David Ellison threatened to pull his legendary studio out of California if a deal isn't reached. As recently as Thursday, Bonta was talking tough, saying he has been winning the legal battle – but adding he was "open" to settlement talks if Paramount comes to the table "in good faith."

Paramount brass have been eager to close the deal, with a painful $7 million per day "ticking fee" kicking in Oct. 1 if the deal isn't wrapped by then. Paramount has asked the states to put up a $1.88 billion bond to address costs of delay, a request Bonta has rejected.

Cali Dems including Gov. Gavin Newsom and Los Angeles Mayor Karen Bass have publicly urged Bonta to settle with Paramount, saying it's vital to keep tens of thousands of Paramount jobs in the state.