** Shares of media giants Paramount Skydance PSKY.O and Warner Bros Discovery WBD.O fall after Reuters reports that a group of U.S. states is preparing a lawsuit to block PSKY's $110 billion acquisition of WBD

** WBD down 3% at $26.28; PSKY extends losses, falls 7% to $9.89

** The group of U.S. states includes California and New York

** It was not immediately clear which other states would join the lawsuit

** Including session's moves, PSKY is down 26% YTD while WBD has fallen 9%