My very first post on EAB back in May dealt with ICC Design suing NBC Universal, Universal Studios, Warner Brothers and New Line Cinema over its concept of Halloween-themed attractions. While there isn’t any new information to report on that case, this post concerns other litigation concerning New Line Cinema.
New Line Cinema recently settled a lawsuit brought by the Tolkien Trust, a UK charity run by the late J.R. Tolkien’s two children, Christopher and Priscilla. The bulk of the lawsuit concerns royalties the Trust was to receive from the “Lord of the Rings” trilogy. Tolkien agreed to sell the rights to make films based on the Lord of the Rings in 1969 in exchange for 7.5% of the gross receipts from any films based on Tolkien’s books after a contractually designed artificial payment level was reached. The Trust, which manages the estate of the “Lord of the Rings” trilogy and its intellectual property, brought the lawsuit in February 2008 alleging that the Trust has not received a penny of the royalties from the “Lord of the Rings” trilogy. The trilogy has grossed nearly $6 billion in theatrical and DVD sales.
The lawsuit asked for $150 million in damages from New Line Cinema for breach of contract, the right to terminate the studio’s rights to make more films based on Tolkien’s works, reformation of the original 1969 contract, punitive damages, an accounting, and related relief. Click here to view the actual complaint.
In September, both parties settled the suit. The terms of the settlement are confidential, but are probably favorable to the Tolkien Trust. The Trust acknowledged as much when it said it “regrets that legal action was necessary, but are glad that this dispute has been settled on satisfactory terms that will allow the Tolkien Trust properly to pursue its charitable objectives.”
The suit ensures that the movie version of Tolkien’s “The Hobbit” will move forward into production. The Hobbit is the prequel to the Lord of the Rings and will be released in two parts, with the first part set to hit theaters in 2011. Part two is due to be released in 2012. The film will begin shooting next year in New Zealand with Guillermo del Toro directing both and Peter Jackson as producer.