Executives at New Line are probably breathing a sigh of relief this morning, as a legal battle that threatened to disrupt production on the planned Hobbit movies has now been settled. JRR Tolkien’s heirs had taken the studio to court over claims that they hadn’t been paid $220 million of their share of the profits from the Lord Of The Rings movies, and they also wanted the courts to terminate any further rights New Line had over Tolkien’s work, which would have meant they couldn’t make the planned Hobbit movies.
It all stems from a 1969 film rights deal, which gave Tolkien’s heirs 7.5% of the gross receipts from any works made from the Middle Earth books, however New Line disputed the terms of the deal and claimed they didn’t owe the money the plaintiffs were claiming. However rather than getting into a protracted legal battle, Variety is reporting that New Line has now settled with the Tolkien Trust for an undisclosed sum, and the heirs have said they are satisfied with the terms and happy for the studio to get on with making The Hobbit movies.
It’s not the first time New Line has been sued over profits from the Lord Of The Rings movies, as both Peter Jackson and producer Saul Zaentz (who originally bought the LOTR film rights in 1969) previously issued legal action saying the studio was undereporting the profits the films had made, but both settled out of court. With all these issues now cleared up, it looks like the way has been left clear for Guillermo Del Toro to direct the two Hobbit movies, which are currently due out in 2011 and 2012.