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Tolkien Trust Sues New Line, May Kill "Hobbit"
Posted by
kdawson
on Tue Feb 12, 2008 08:07 AM
from the mine-mine-mine dept.
from the mine-mine-mine dept.
oboreruhito writes "The AP is reporting that the Tolkien Trust and HarperCollins are suing New Line Cinema for $150 million in compensatory damages, unspecified punitive damages, and a court order revoking New Line's rights to produce any more films on Tolkien properties. The Tolkien Trust says that New Line paid them only $62,500 to make 'The Lord of the Rings' trilogy of films — instead of the agreed-upon 7.5 percent of gross receipts of all film-related revenue. The suit may set back, if not kill, a film adaptation of Lord of the Rings prequel 'The Hobbit,' which Peter Jackson had recently signed up to make after his own legal row with the studio over payment for the sequels."
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Tolkien Trust Okays <em>Hobbit</em> Movie 325 comments
saudadelinux writes "Last year, the Tolkien Trust, which administers JRR's estate, bellowed stentoriously, 'Youuuu shall not make The Hobbit!' and sued New Line Cinema for 'a reported $220m (£133m) in compensation, based on breach of contract and fraud.' New Line, chastened, has settled for an undisclosed sum of money. The Trust has given its blessing to New Line for Guillermo del Toro to film The Hobbit and for New Line to make other films based on Tolkien's work. Much rejoicing!"
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When will they learn... (Score:5, Insightful)
This is why you see lots of big actors and big name directors and talent working on more and more "indie" films. they actually get what they are promised from the indie companies.
Re:When will they learn... (Score:5, Interesting)
Parent
Re:When will they learn... (Score:5, Interesting)
Even so, many films with big-name actors that are called "independent" are nonetheless closely tied to studios. Remember the buzz over Eternal Sunshine of the Spotless Mind [amazon.com] , a fresh new film made by a new group of filmmakers outside the mainstream? Well, it came from Focus Features, which despite calling itself an "art house" studio is in fact owned by Universal.
One wonders if the accounting on European films is more honest. European film industries are heavily subsidized by the state, and when you have to report back to the state on what you've done with their funding, perhaps there is less temptation to cook the books.
Parent
If no film makes a profit... (Score:5, Funny)
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Re:When will they learn... (Score:5, Interesting)
If your name doesn't come before the title, then you're never, ever getting a sniff of the gross. Even headline producers, writers and directors often can't demand that, and end up with less than the guy working the clapboard for union salary.
One of the most egregious cases is creator/producer/writer J. Michael Straczynski getting boned over Babylon 5 [google.com]. He was in for a share of the net, and Warner Brothers demonstrated by their actions that the show was making a net profit every season (or else it would have been shitcanned). However, the final figure, after all production expenses had long since ceased, and all the money from merchandise and DVD sales (half a billion gross!) was in worked out to a claimed $80 million loss. Riddle me that.
Parent
Re:When will they learn... (Score:4, Informative)
But you're right, studios are scumbags.
Parent
Re:When will they learn... (Score:5, Informative)
That's what you think. By selling the distribution rights to a subsidiary below cost, New Line was able to show a loss on the movie while their subsidiary was showing gangbuster profits. Since the contract was with New Line rather than the subsidiary, the result is that they didn't have to pay out any royalties.
So sorry. Maybe the next film will do better? Just sign here on the dotted line and we promise cross our hearts that the next film will show a profit. Really.
I almost guarantee that the judge will take New Line to the cleaners for such accounting. It won't change anything, though, as the studios count on it being too costly to go through a court battle to recover the money you're owed. An occasional loss in court still brings them out ahead.
Parent
Re:When will they learn... (Score:5, Funny)
Parent
Re:When will they learn... (Score:5, Insightful)
Jackson himself only got paid after he sued New Line. And then New Line refused to hire him for the Hobbit in retaliation.
Its not just that the people are crooks, they are stupid crooks. They kill the goose that lays the golden egg.
Tolkein sold the rights to the film version of TLORT to pay a tax bill. At the time the film could not have been made, the technology didn't exist to do it well on a realistic budget.
What New Line seem to have forgotten is that the contract had a royalty clause. They probably forgot because its stated in terms of profit and everyone knows that the films never make profits after the Holywood accounting and the California courts are owned by the studios.
Only problem is that the contract was signed in the UK and UK law does not favor the studios on this.
Parent
Re:When will they learn... (Score:5, Informative)
Not exactly. He had already been paid quite a bit, but not nearly as much as they owed him.
-jcr
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Re:When will they learn... (Score:5, Funny)
They obviously didn't pay him enough to eat. Didn't you see how much weight he lost after making those films?!?
Parent
Re:When will they learn... (Score:4, Informative)
Not true. jackson got paid according to his contract. However, his contract did not specify that he should get a percentage of the "tie in revenues" (games, toys etc.) He sued New Line to get a piece of that as well.
Parent
Re:When will they learn... (Score:5, Informative)
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Re:When will they learn... (Score:4, Interesting)
I must admit that I was suprised that the studio apparently gave no thought given to the Tolkein Estate interest in the tie-ins. The original contract was pre-Star Wars. They bought an option on the film rights, not the merchandising. Merchandising did not exist in 1969.
Parent
Re:When will they learn... (Score:5, Informative)
I believe it went something like this (numbers made up):
Jackson gets x% of the profit from New Line Pictures.
New Line Pictures sells the DVD rights to New Line DVD for $0.50 a copy. Open market bidding would've resulted in a price of $10 a copy.
New Line Parent Company makes tons of money on the DVDs. But Jackson's contract was with New Line Pictures, who barely made any money at all off the DVDs, so Jackson gets very little money.
There were probably other similar items involved, but DVDs is the one I remember specifically.
Parent
Re:When will they learn... (Score:5, Informative)
No, but he co-wrote the screenplay, directed and co-edited all three films(at the same time) and helped set up a company specifically to do the special effects. For him, it was a 10 year project, 24/7(literally). Watch the extras and you'll see he basically lived the film for the entire project. It was only because he put so much effort into it that the film was such a great success, or even got off the ground at all.
Parent
Re:When will they learn... (Score:4, Informative)
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Re:When will they learn... (Score:5, Funny)
Without guys like us making connections and cutting deals, there'd have been only one Highlander movie. And that would have been a real tragedy.
Parent
Terry Gilliam does the Hobbit? (Score:5, Funny)
Now there is a great idea - have Terry Gilliam do the Hobbit. Only the plot would need some twisting to make it into Gilliam territory.
When the dwarves are captured by the elves, at least one needs to die during interrogation while believing that they are escaping. Sting would need to be a vorpal blade. Smaug would swallow its victims and then spit out the bones. Some time travel would be inevitable while leaving Dale. Shelley Duval would make a cameo appearance asking Thorin to return the map. Thorin would become delusional and would try to reach the Mountain in a balloon. It would all end with Bard declaring that he was not the Messiah.
Cheers,
Toby Haynes
Parent
Re:When will they learn... (Score:4, Interesting)
Article on it [nytimes.com]
So not only do they screw the Tolkien trust, but they also screw the guy who MADE the movie. Good job Newline, I have a feeling you may have a hard time attracting talent in the future.
Parent
Re:When will they learn... (Score:4, Insightful)
Probably no more than many other businesses and individuals breaking their promises nowadays. It used to be that people, and that includes companies run by them, would keep their word and promises. Big business deals were at one time sealed with a word and a handshake. Today, even a contract with more print than the phone book for a big city may not be honored.
People incurring debts and then abusing bankruptcy laws to get out of paying is no different. A couple breaking the promise of marriage, or a parent breaking a promise to their son or daughter is really no different, except in the amount of money involved. Breaking a promise these days is no longer considered by many, to be a big deal. It happens all the time and is considered normal by many.
Parent
Marriage as contract (Score:5, Insightful)
Marriage is a tad different, in that the things that are promised ("vowed," which is a word we don't hear often enough without irony) are impossible to promise. You may say you will love, cherish, and respect another until the day you die, but you are not promising something you can, in good faith, honestly *know* you can deliver.
People change. Feelings change. Circumstances change. To promise to love someone forever is not a realistic promise. You can promise to *try*. But you can't promise you *will.* At least, not with any real certainty.
In business (and in promises to kids or spouses about realistic promises), you are promising to deliver something that is within your ability. If you promised something you *can't* deliver, you are a liar. If you renege, you are a cheat (in the case of business).
I do wish there were a code of honor these days, but there isn't. Instead, misinformation, lies, and manipulation are the norm in politics and business. So, why shouldn't it be the norm in our day-to-day lives, as well?
Oh, well. If you do your best to be honorable, I will also do my best to be honorable. If we can get a few hundred thousand to also be honorable, we might be able to change things for the better.
I wouldn't count on it, though.
Parent
Re:Marriage as contract (Score:5, Insightful)
Parent
MOD PARENT UP -- "love" is a verb, after all (Score:5, Interesting)
Very well put. One thing that struck me after studying German for a while is that, much like "sit" and "set" or "lie" and "lay" are intransitive/transitive verb pairs differentiated by the central vowel ("sitzen" and "setzen" / "liegen" and "legen" in the German), so too are "live" and "love" ("leben" and "lieben") -- "love" is the transitive form of "live". So in that sense, loving someone is helping them live well, helping them grow and be healthy. Romance doesn't *have* to enter into this picture, which is why you can just as well love your siblings even despite a very rocky growing up. Which is also why I know that I'm loving my wife the most not when I'm feeling all lovey-dovey, but when she's annoying the crap out of me or I'm pissed as hell at her, but *still* try my damnedest to make things work.
Love is work. Marriage is work. And the truer measure of how much you love your partner/spouse doesn't happen during the easy times -- it's how you behave and how you work at it during the rough times, even if you happen to hate each other's guts right at that moment. *That's* when you fulfill whatever promises or vows you've made.
Cheers,
Parent
Re:When will they learn... (Score:4, Interesting)
Look, I'm going to type this very slowly, because you are clearly hard of understanding. Also, you will need to sit down, because what I am going to tell you will shock you to your very core.
Studios lie.
Are you all right? Can you speak? Just keep breathing!
Please read this [google.com]. Read all the words. Note how WB acknowledged though their actions that Babylon 5 made a net profit each and every season (or else they'd have shitcanned it). And yet the final figure, long after all production expenses ceased and all the post production merchandising and DVDs sales were in, was a net $80 million loss.
Studios lie. They lie all the time, to almost everyone. The only people that they have to keep sweet are their big names, and only if they think they can't be replaced. Everyone else has to sue them to get any money, and the studios gamble (and often win) that the peons don't have the necessary resources to do it.
So feel free to go on arguing about how things should work. The rest of us can discuss how they actually work.
Parent
Of course... (Score:5, Insightful)
New Line makes movie, movie costs $100MM to make.
Movie is a moderate hit, Movie makes $150 MM in theaters and tie-ins in the first year.
The $150 MM Profit number gets reported by New Line to your little website.
But, there's more...
The actual studio and sound stages aren't owned by New Line, they're owned by New Line Studios and Sound Stages, Inc.
And they must be compensated. $5 MM.
And, of course, the post-production is done by New Line Post Production, Inc.
Andd they must be compensated. $10 MM.
And then there's the TV advertising. This is done by New Line Trailer Production, Inc.
And they must be compensated. $30 MM.
And we can't forget the costs of booking travel and making the logistical operations. This is done by New Line Logistics
And they must be compensated. $5 MM.
And when it's all said and done...
Damn...
The movie JUST broke even.
Sorry little fella, but New Line made a big investment here, and we just don't have the ability to pay you out of our pockets: As it is we just broke even!
Of course, all those Subsidiaries will be kicking most of that back upstairs, but hey, that's THE BIZ!!!!
Parent
Re:When will they learn... (Score:4, Insightful)
Old joke: Ask a math teacher, how much does five plus five equal, they say "10". Ask a hollywood accountant, they'll close the blinds, shut the door, and whisper "How much do you want it to be?"
Parent
Soo ... (Score:4, Insightful)
I'm shocked! Shocked!
We all know that Hollywood Accounting [wikipedia.org] is a complete scam.
Re:Soo ... (Score:5, Insightful)
Parent
Re:Soo ... (Score:5, Insightful)
But I can't believe that New Line is trying to say that they made less than one million dollars on the movies though. That's got to be worst than Cutthroat Island.
Parent
Re:Soo ... (Score:4, Insightful)
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Re:Soo ... (Score:5, Interesting)
I think that New Line is scummy for their shady accounting practices, but they really should not have had to negotiate for the film rights to begin with.
Parent
Re:Soo ... (Score:5, Insightful)
Since I'm someone who makes a living off his "intellectual property", I've thought about this a lot. I just can't see any benefit (as far as the original purpose of copyright is concerned) for any rights to a work of art to be transferable in any manner. I might go so far as to say an artist should be able to "license" his idea to someone else who wants to extend the work somehow, but there's no reason his grandchildren should be able to reap direct benefits from it.
If I get rich off my work (probability: imperceptible), I'll leave the dough to my wife and daughter (who both happen to be younger and healthier than me, and thus likely to survive me). I feel the same way about patent. If an inventor wants to monetize his invention, he should either develop it himself or license it to a company to develop. When he dies, it should become public domain.
And don't tell me this will "hinder innovation". Innovators innovate. It's what they do.
Parent
Re:Soo ... (Score:4, Insightful)
Of course I personally favor the "infinite copyright period with frequent renewals and exponentially increasing fees" model. I doubt we'll ever see that though.
Parent
"'The Lord of teh Rings' trilogy". Jesus christ? (Score:5, Funny)
Let's break this down.
"The Lord of teh Ring's trilogy"
You know what, I'm not even going to bother. What kind of retard submitted this?
Ahh, delicious irony... (Score:3)
Glad to hear it--they're getting what they deserver.
Re:Ahh, delicious irony... (Score:5, Interesting)
Parent
Re:Ahh, delicious irony... (Score:5, Insightful)
Quite a bit north, actually. In point of fact, just shy of three billion [the-numbers.com] dollars. And that's not considering merchandising tie-ins, DVD sales, and all the rest of the "film related" revenue.
So I guess we now know the answer to "what has it got in its pocketses?" A shitload of other people's money!
Parent
But that WAS 7.5% of the takings (Score:3, Insightful)
Has anyone ever figured out the arithmetic to find out how much profit a given studio is making on the assumption that the takings they quote to people who should be getting X% of the total are accurate? I am pretty sure it would demonstrate a massive loss year-on-year.
Come on, the studios are right (Score:4, Insightful)
Well, answer this (Score:5, Insightful)
But what do you think the same studios would say if you took a film made in 1954 and just started distributing it? They'd sue you into oblivion. Further, it was the film studios themselves who pushed for such long copyright terms.
So I don't see they have either the legal or moral standing to complain about this. They should pay their damned bills, frankly.
Parent
Re:Come on, the studios are right (Score:5, Insightful)
Unfortunately for you the trilogy was released in 2001/2/3, and filming began in October of '99.
That's pretty far short of 50 years after the work was created, and only 26 years after the death of Tolkien himself.
Oh -- and according to Wikipedia the gross revenue of the films was $871,368,364... 7.5% of that is a hair over $6.5 million. Which means NewLine payed them less than 1% of what they were actually owed. Which, whether you think the copyright law is proper or not, when there's a contractual agreement to pay a certain amount for something and you decide "LOL FUCKIT" and actually pay less than 1% of what you said you would, well.. you're probably a giant dick and deserve to be sued for 25 times how much the original agreement was for.
I'm just sad that this means we probably won't see a Hobbit movie.. but I guess we CAN all look forward to The Hibbot?
Parent
In a very ironic way (Score:5, Insightful)
sad curse that overtook Gollum...
"My Precious, My Precious!... Must have the Precious!"
If I may say so, I truly wonder what Tolkien himself would think of all this pathetic bickering and bitter lawsuits.
Z.
Re:In a very ironic way (Score:5, Funny)
I think he would recommend rising an army of Elves, Dwarves, Hobbits and horsemen to besiege the Two Towers of New Line Cinema, and shoot their Nazgul lawyers whenever you get a chance.
Wouldn't he?
Parent
Re:In a very ironic way (Score:5, Funny)
I'm not positive; but I suspect his response would be long, boring, and involve a lot of walking.
Parent
anyone remember dragon magazine (Score:5, Funny)
"Someone get the phone, its circular metal banding off the hook!"
Nasty!!! (Score:4, Funny)
Re:Wow! (Score:5, Funny)
Surely failing to imitate Digg is a good thing...
Parent
Re:Wow! (Score:5, Insightful)
Digg can be a neat site for the sheer volume of articles, but it has some serious and aggravating problems. To give one example: it was refreshing to come here this morning and find only one story about the Anonymous protests of Scientology instead of, oh, say, ten.
The Anonymous group seems to have taken a page from Ron Paul supporters: they've positively Digg-bombed the place, putting multiple (and entirely redundant) stories onto the front page, as if this will somehow raise awareness about the CoS amongst a demographic that is vulnerable to the Church's tactics. But they can't do that on Slashdot because of the editorial control here. Add to this the fact that Digg is no longer news for nerds in the way Slashdot is (sports articles now show up with alarming frequency on Digg), and that the comments on Digg absolutely stink compared with those here (yes, they're even worse than ours).
I enjoy Digg for its constant volume of new articles, but Slashdot's articles are much better presented (yes, even with the "teh" in TFA). If this site posted more frequent stories to compete with Digg's volume I'd have little reason to go to Digg. Volume is about the only advantage they have.
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Re:Standard corporate intimidation (Score:4, Insightful)
Are you surprised? But this is what you get when company as entity have nor moral nor serious legal obligations to law. Surprise, it is cornerstone of so called American business thinking.
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