LoTR Lawsuit Threatens Hobbit Production 427
eyrieowl writes "J.R.R.'s heirs are suing for royalties on the LoTR films. Apparently they haven't gotten any money due to some creative accounting. Peter Jackson ought to understand...he had to sue the studio for much the same reason.
As for The Hobbit? FTFA: 'Tolkien's family and a British charity they head, the Tolkien Trust, seek more than $220 million in compensation...[and]...the option to terminate further rights to the author's work.'"
They crossed up their net and gross reciepts... (Score:5, Informative)
Looks like the deal was done maybe 40 years ago:
Under the contract, New Line was to pay a percentage of all gross receipts, after deducting 2.6 times the production costs, plus advertising expenses in excess of a certain amount, according to Eskenazi. (from TFA)
Nowadays it seems as though even the average slashdotter knows you take a portion of gross, because nothing involving MPAA or RIAA related-companies ever clears a 'net profit' (wink wink).
It looks like Tolkien & co where less saavy 40 years ago, and essentially signed up to get screwed. I hope the movies were profitable enough that they can still clear some money for the family, but 2.6 times production costs of those movies is a hell of a lot, and 'advertising expenses in excess of a certain amount'- especially if that amount was a 1969 dollar amount, and not a percent-well, they could really end up with a contractually dictated 'nothing.'
Let me spell this out clearly (Score:1, Informative)
Re:Threatening Hobbit Production... (Score:5, Informative)
Unfortunately, you aren't a Hobbit, and this kind of stuff is so common it has it's own name and Wikipedia entry. Look up Hollywood Accounting [wikipedia.org]. It's pretty simple and extremely sleazy. Remember that profits are simply income minus expenses. If you make $100,000 but it costs you $40,000 in expenses, you have $60,000 in profits.
Most movie earnings are reported in gross sales. Profits are slim, on purpose.
Let's say you are a Hollywood producer.
1) Make a deal with somebody to "share the profits" by using their idea.
2) Produce the movie by hiring sub-contractor "companies" that happen to have you has the CEO. These "companies" are very expensive, and payed based on gross sales.
3) Movie gets produced, makes record sales.
4) The "companies" previously hired are payed based on the sales numbers, leaving no money left to call a "profit".
5) ???
6) Screwed partner makes nothing because there are no profits to share.
Smeg off! (Score:2, Informative)
The book is 72 years old. Smeg off you vultures!
http://en.wikipedia.org/wiki/The_Hobbit [wikipedia.org]
Re:Bad news all around (Score:3, Informative)
Re:Then explain this (Score:3, Informative)
Christopher Tolkien published the Silmarillion, after JRRT's death, among several other books, including the History of Middle Earth. Sure, strictly speaking it was all JRRT source material, but there has been a wealth of information out there, produced by these guys.
Re:This is common in Hollywood (Score:3, Informative)
I agree that its criminal, but anyone who deals with this knows that you MAKE SURE you negotiate for "above the line" or "pre-expense" percentages of gross, guaranteed $x of the initial gross BEFORE expenses and marketing, as well as pre-production "commitment" fees of about half of what you want to make on the entire project. The latter is most important as it says nothing can even begin production until you get paid.
However it would be really funny to see a few people get charged with felonies for fraud and share a cell with Bernie Madoff.
Re:Then explain this (Score:5, Informative)
Uh, The Silmarillion and The Children of Hurin. There are tons of notes and papers the Tolkien kept while writing his stories. Many of these offer insight into the world of Middle Earth, and would not have been easily accessible if it wasn't for the work of his son. Christopher Tolkien has spent a great deal of time going through his father's work, assembling notes from various sources to try to provide a more detailed history of Middle Earth. While the heirs aren't responsible for the original tale, they have done there share of work to get the story behind the story out and available to the public. Without the background, creating a movie like LotR would be much more difficult. The entire mythos was not well documented within the confines of the books. There were a lot of details that don't fit nicely within story form that were important to the movie. One of the biggest examples is the Elvish language. Much of the language has been put together from his original notes, which have been assembled by Christopher over the years.
This is definitely not a case were the children are sitting around trying to bum money off of their parent's work. I am very thankful for their contributions. Without their work, my knowledge of Tolkien would probably be limited to The Hobbit and The Lord of the Rings.
Re:Bad news all around (Score:4, Informative)
Re:Then explain this (Score:2, Informative)
Re:Threatening Hobbit Production... (Score:1, Informative)
Tolkein actually had a share of revenue, not profits. 7.5% of revenue - (2.6 * costs). Somehow with $6 billion revenue, the movie costs are $2.3 billion!
I want to see the New Line Cinema aircraft carrier that was charged to this account.
Old news (Score:1, Informative)
Who dug this up? This story is over a year old...
http://movies.ign.com/articles/852/852192p1.html
February 14, 2008 - Earlier this week, the estate of author J.R.R. Tolkien sued New Line Cinema over profits from the studio's Oscar-winning, blockbuster Lord of the Rings trilogy, a move that cast doubt on the possibility of their feature film adaptation of Tolkien's The Hobbit.
Or just google "Hobbit lawsuit"
sheeesh.
Re:Then explain this (Score:5, Informative)
The contract was signed by J.R.R. Tolkien in 1969. Copyright doesn't even enter into the argument. New Line, Time Warner, and MGM are all bound by the original contract, signed by J.R.R. Tolkien. As the Inheritor of his estate, Chris Tokien has the right, along with the Tolkien Trust, to enforce the terms of the contract through civil action.
I hate to make this sound angry, but it has nothing to do with Chris Tolkien, other than he's the one who inherited the money. J.R.R. Tolkien sold a product for a specific fee, partly up front, and partly to be paid later. The studio is now using fraudulent accounting techniques to avoid paying the "later" part. If J.R.R. Tolkien were still alive, he would be the one suing. Hes not, but the contract is still binding, so his estate is suing.
Copyright doesn't even show up in this equation. Nor does whether his heirs added anything to the mythos (which he has through his clean up and publishing of all the remaining Tolkien works and notes.)
This is just simple, every day, contract law.
Disclaimer: IANAL, and this is my opinions, based on reading TFA.
Re:this is common in hollywood (Score:4, Informative)
Re:Damn leeches (Score:5, Informative)
Actually, Chris did a goodly amount of work recompiling the whole Middle Earth saga from notes, he tried to fill in unfinished stories of his father. He did try to clarify inconsistencies, add stories, and overall maintain the work that was left behind.
No, he wasn't responsible for the work that these movies is based on directly... But he did become the de facto caretaker of the fictional setting.
Re:Damn leeches (Score:4, Informative)
Fourteen years, renewable once, from date of first publication would cover everything you complain about.
BTW, the Silmarillion was not delayed until Tolkien's death due to lack of demand. Ballantine (who sold LOTR in the US) would have loved to publish it while Tolkien was still alive. Tolkien didn't authorize it. Lin Carter (in charge of Ballantine's fantasy fiction line at the time) told me (a long time ago, at a science fiction con), that he thought Tolkien simply didn't want to stop fiddling with it and changing the form, that he thought Tolkien really didn't have anything else he wanted to do.
Re:Then explain this (Score:3, Informative)
Christopher also did a fair bit of editing, cleaning-up and polishing, so he did actually have some creative input. I'd also include the audio tapes, which include an otherwise unknown piece of Elvish poetry being sung by JRRT, as contributing to our knowledge.
Re:Damn leeches (Score:1, Informative)
there is a reason why copyright runs from publication date.
What nonsense is this? Copyright exists from the moment of creation. You have copyright on a work whether you publish it or not. What is it about legal matters that compels Slashdotters to just make shit up at random?
Re:Threatening Hobbit Production... (Score:3, Informative)
And this is apparently one of them:
"The heirs also question expenses, according to Eskenazi, including an advance payment to an unnamed principal in the âoeLord of the Ringsâ films for an unrelated project, and a $1 million completion bond charged against gross receipts for each of the three films, even though a bond was issued only on âoeThe Fellowship of the Ring.â The studio also deducted a distribution fee for the home-video market, she said. "
Re:Damn leeches (Score:3, Informative)
Re:Bad news all around (Score:3, Informative)
Maybe a lot of slashdotters aren't old enough to have kids, but it seems to me that providing for one's widow and/or children is one of the things that an author would likely be concerned about, and probably even consider to be a "need".
Author's can buy life insurance like the rest of us.
Do plumbers demand royalties for toilets they fixed for their children after they die? Nope.
Same difference.
Just because you write books or make music, doesn't give you anymore rights than all the cubicle slaves and factory workers of the world.
You want something to give your children after you pass one... Buy some land, buy stocks, and get insurance. It is what everyone else has to do.
Re:Bad news all around (Score:3, Informative)
Any author can already put the money they make during a fixed term into a trust for their heirs, or otherwise leave it to them in their will or make many other arrangements to get it to them, just like a person running a business or working for wages can leave money. So it's not just like any other property, it's a special, additional way to provide for a family after death, added on to all the rest everyone including authors can use.
Re:Threatening Hobbit Production... (Score:3, Informative)
Re:They crossed up their net and gross reciepts... (Score:3, Informative)
> Tolkien clearly, obviously, lifted a lot of his LOTR trilogy from Wagner's opera Ring of the Nibelungs.
No, he stole from the same sources that Wagner's sources used to compose the Nibelungenlied and the Volsung Sagas, even going back to old Finnish epics.
Admittedly, LoTR could have been made using animation much earlier, as it WAS (look the two movies up on IMDB). The animated versions don't come close to the film adaptation, though.