Get the lowdown on why Peter Jackson isn't on board (at least not yet) for ''The Hobbit.'' Plus: the filmmaker New Line reportedly wants instead...

By Missy Schwartz and Vanessa Juarez
Updated January 08, 2007 at 05:00 AM EST
Credit: Peter Jackson: Sam / Starface / Retna UK
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Seventeen Oscar wins. $3 billion in worldwide box office. Near-universal praise from critics. Yes, we’re talking about the Lord of the Rings trilogy and the man who directed, produced, and co-wrote all three movies: Peter Jackson. You’d think that Hollywood would be begging Jackson to make The Hobbit. But you’d be wrong. In a letter to fans posted on on Nov. 19, Jackson announced that New Line was pursuing other filmmakers for the LOTR prequel — and since then, the situation has only gotten more complicated. Here’s our primer on how the most anticipated movie since The Phantom Menace ran into obstacles worse than evil Lord Saruman.

Money. Jackson’s Wingnut Films filed a lawsuit against New Line in 2005, asking the studio to fully disclose all revenue from The Fellowship of the Ring, including international box office, DVD and TV sales, and merchandise like videogames and action figures. (It’s possible that amount could be in the tens of millions.) And while he is not suing for a specific sum, the studio could owe him millions. Or zilch. ”We would like an independent body — whether it be a judge, a jury, or a mediator, to look at the issues,” Jackson explained in his letter. ”We are happy to accept whatever that ruling is.” A source close to the Jackson camp alleges that New Line has continuously stymied the audit. New Line execs declined to discuss the matter, only saying ”We are in litigation with Wingnut Films, and have been unsuccessful despite a formal mediation, as well as discussions with Wingnut directly, to settle the matter.” According to Jackson, the studio would be willing to settle, provided the director committed to making The Hobbit, which has been envisioned as two movies. But for Jackson, those terms are ”the worst reason in the world to agree to make a film.” Meanwhile, Saul Zaentz, the producer who bought the Hobbit and LOTR rights in 1976, is no doubt following the legal fracas with a sense of déjà vu. He too sued the studio back in 2004 over royalties, and settled in 2005. And in 2003, Viggo Mortensen spearheaded an attempt to get New Line to offer greater compensation to some of the cast. The studio eventually coughed up bonuses of an undisclosed sum.

It all boils down to who owns the rights to The Hobbit. While it sounds ridiculous today, for years the LOTR books (and their prequel) were mired in development hell. Zaentz had originally bought the rights to turn the Tolkien works into movies from United Artists, now a subsidiary of MGM, back in 1976. (MGM still owns the distribution rights to The Hobbit.) In 1997, Zaentz sold those rights to Miramax, which passed the property on to current owner New Line a year later. (Phew!) But the studio now seems to be facing a ticking clock, because insiders speculate the window for New Line to make a Hobbit movie might close sometime after 2008. Which may explain why the studio is suddenly so gung ho to reunite with Gollum, Gandalf, and Co.

As Jackson told his fans, he is not interested in discussing The Hobbit until the lawsuit is resolved. And with a possible deadline looming, New Line is understandably not interested in losing hundreds of millions of dollars in potential box office and ancillary revenues. So, according to sources, the studio recently began courting other filmmakers,including Spider-Man director Sam Raimi. (Raimi did not return calls for comment.)

Finally, some good news. Yes, Jackson did say he is now focusing on The Lovely Bones, which is due to begin shooting next year. But everyone from TheOneRing-ers to trilogy star Ian McKellen is publicly lobbying for him to make the movie. ”I should have relished revisiting Middle-earth with Peter again as team leader,” McKellen wrote on his website. ”I am hoping that New Line, MGM, and Wingnut can settle outstanding problems.” Then there’s MGM, which may be the most optimistic party of all. ”We support Peter Jackson as a filmmaker, and when the dust settles, we believe he’ll be making the movie,” said a rep for the studio. ”We can’t imagine any other result.” It’s safe to say that they speak for millions — a fact Jackson is no doubt hoping will be very hard for New Line to ignore.

The Hobbit

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