High-Stakes Legal Skirmish Over “The Hobbit” Sequel

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The second of three planned movies based upon J.R.R. Tolkien’s classic novel “The Hobbit” is opening December 13 in theaters, but it is already generating high-stakes legal maneuvering behind the scenes. Heavyweight producers Bob and Harvey Weinstein have threatened to sue Warner Bros. studios, arguing that they should get a percentage of the film’s revenue.

The Weinsteins once controlled the film rights to Tolkien’s works, including “The Hobbit” and “The Lord of the Rings” through their ownership of the Miramax company. They later sold the company but argue that their contract entitles them to a percentage of all the new films based upon “The Hobbit.” New Line and Warner Bros., the producers of the current series of Hobbit films, gave the Weinsteins a percentage of the revenue from the first film of the series, last year’s “The Hobbit: An Unexpected Journey,” but argue that the contract did not entitle the Weinsteins to any money from the other two films. New Line and Warner have moved to have the case heard in arbitration. The Weinstein’s share of the first movie’s profits has been estimated at about $12.5 million.

There are huge amounts of money at work in television and film, and with a franchise such as “The Hobbit,” the licensing and merchandising rights alone could be worth more than the gross national product of many countries around the world. All of this money attracts litigation like piles of dwarf gold attract dragons.

Sorting out the property rights and contractual obligations in the entertainment business is not easy. All those in Florida’s entertainment industry can benefit from the help of attorneys with experience in many aspects of entertainment law.

Source: The Hollywood Reporter, “Warner Bros. Takes Miramax to Arbitration Over Weinstein ‘Hobbit’ Claims,” Tatiana Siegel, Dec. 4, 2013

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