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The family of JRR Tolkien will go to court in the autumn in a multi-million-pound dispute over royalties from the blockbuster movie version of The Lord Of The Rings.
On 19 October, the family will take on Hollywood studio New Line Cinema in a Los Angeles court. At stake is a share of the £3billion receipts generated by the trilogy in cinema and DVD sales.
The legal action, the culmination of a long-running dispute, is being brought by the Tolkien Trust, which is run by the author's two surviving children, Christopher and Priscilla. They claim to "have not received a penny" of royalties.
The lawsuit accuses New Line of "insatiable greed" and engaging in the "infamous practice of creative Hollywood accounting".
If the family is successful, the outcome could block the long-awaited - and eagerly anticipated - cinema adaptation of The Hobbit.
That film, due to star Sir Ian McKellen in a reprise of his role as Gandalf, has been earmarked for filming next year with a general release planned for 2011.
The legal battle centres on Tolkien's decision in 1969 to sign over film rights to United Artists for £153,000.
The family's lawyers are convinced that the trust should now receive a larger amount. The action is being taken jointly with publishers HarperCollins.
Steven Maier, a commercial litigation partner with Manches law firm, said: "The trustees are appalled by New Line's attitude to their legal obligations and are determined to pursue their claims to their rightful conclusion."
New Line's parent company, Time Warner, has refused to comment.
Reader views (3)
Without reading the contract it is impossible for us to judge this case based on a brief news article.
Selling film rights often involves future royalties as well as a lump sum up front, and in 1969 the parties involved certainly knew about television, and video tape, and certainly could imagine new future ways of displaying a film. In a couple of cases the has been that "new media" such as DVD, VHS, Beta, LaserDisk, internet, etc while not specifically called out in the contract are covered - even if they did not exist nor were imagined at the time - because these "new" methods still use the FILM itself and that film is the material part of the contract, the distribution method is seen as secondary.
A contract for film rights today will specify the exact methods covered, as well as any future methods - in essence they try to avoid this Tolkien Scenario in the future.
Also many of these cases involve the 'Hollywood Accounting' mentioned, where the financial side of a movie is structured so that the entity that is responsible for paying royalties can validly claim "there are no profits."
So, unless the 1969 contract was a total sort of assignment/sale of rights with NO royalty provisions whatsoever, chances are the Tolkien's have ground on which to stand.
- Trunk, US
He sold the rights - his to sell. 153k in 69 was a lot of cash and no doubt the kids had a chunk of it. If I sold a car to someone, I do not expect - when it is sold again - to get a cut.
- Mr Pastry, Brisbane
looks like the Ring has struck again, my precioussssssss
- Jim, London
