The estate of author J.R.R. Tolkien—represented by a British charitable trust called The Tolkien Trust—is suing New Line Cinema, claiming the film company failed to pay the trust its cut of the three films released earlier this decade. The trust claims its deal with New Line was for 7.5% of the gross receipts from the Lord of the Rings movies (The Fellowship of the Ring, The Two Towers, and The Return of the King) released in 2001, 2002, and 2003. According to the complaint, the films have taken in nearly $6 billion, but the Trust has seen only the upfront payment of $62,500. The suit seeks $150 million in compensatory damages, and unspecified punitive damages.
“The Tolkien trustees do not file lawsuits lightly, and have tried unsuccessfully to resolve their claim out of court,” Tolkien estate lawyer Steven Maier said. “New Line has not paid the plaintiffs even one penny of its contractual share of gross receipts despite the billions of dollars of gross revenue generated by these wildly successful motion pictures.”
New Line declined to comment on the pending litigation, but insiders note that the lawsuit could put a damper on the producer’s plans for the two-movie prequel based on The Hobbit, which Peter Jackson is planning to executive produce (see our earlier story).
According to the filing, Tolkien established a trust and through it signed a movie deal in 1969 with United Artists. His heirs created the charity after his death. In 1978, Hollywood producer Saul Zaentz acquired the rights, produced the animated 1978 film, and then licensed the rights to live-action films to New Line.
In 2004, Zaentz sued New Line claiming the studio owed him $20 million in royalties on the film trilogy (they settled out of court in 2005). And in 2005, Jackson sued New Line over missing payments (they settled in 2007).