Christopher Tolkien: kill HOBBIT film

[Sauron the White]

I feel like Pippin asking Gandlaf endless questions............. one more .............

this motion to Strike later this month..... are those damages tied to punishing New Line and would the request to revoke New LInes film rights be part of that punishment?

In other words, if New Line prevails at removing punitive damages from the litigation and only actual monies owed to the Estate are then part of the suit, is the question of revoking film rights also removed from the suit?

[William Cloud Hicklin]

That's a separate matter, which has to do with the interpretation of a specific clause in the contracts.

The rights-recission issue has to do with how the court reads a term in the 1969 Agreements, which provides that if the studio is found to have failed to pay up, then Tolkien or his heirs can cancel the deal (again, this doesn't apply to Zaentz or MGM).

It's not related at all to the punitive-damages question punitive damages (which are a creation of the law, not any specific agreement) can only be awarded for torts, not brach of contract: TW is trying to get rid of the tort claims of fraud and breach of fiduciary duty).


Oh, what is a tort? A tort occurs when a person causes harm by breaching a duty imposed on him by the general law: like the duty to drive sober and not run people over. Breach of contract refers to breaching a duty imposed not by the law generally but only by the voluntary obligations of an agreement.

[Sauron the White]

One more question: given the trigger mechanism which is in the contract saying there is a measurable point where the profit royalties kick in, does the contract provide for a clear and agreeable definition of terms? Are such important terms as COST, REVENUE and PROFIT clearly defined?

To my laymans way of thinking, that would be important.

[William Cloud Hicklin]

Yes. In fact, the definition of "total gross revenues" alone runs to three and a half pages.

[Sauron the White]

So you have the contracts that were attached to the filing?

Are these available on line or in some way other than paying high downloading fees?

Is there also a definition of what cost is? That would seem to be crucial given the 2.6 multiplier.

[William Cloud Hicklin]

Unfortunately they are only available for, yes, high downloading fees.

The definition of 'cost' is also extremely long, more that I feel like typing out (what I have are graphic scans, not text files), but it boils down to monies expended in order to produce and deliver the Master Print, plus certain extras like taxes, union/guild assessments and so on. Marketing/advertising aren't part of it (the strong impression I get is that costs associated with distribution were what the 2.6 multiplier was for- in effect the sellers were saying "no Hollywood tricks here- we're going to define how much expense you can claim.")

Significantly, the contract language carefully included 'subsidaries,' which would bar exactly the sort of dodge New Line pulled with the DVD's (selling them for $.20 on the dollar to New Line Video).

[Sauron the White]

Thank you for that WCH. In your opinion, are costs, fees paid to talent associated with the film - not just up front payments but payments after the films are completed and shown? In other words, the rumored $150 million paid to Jackson - would that be part of the cost?

You say the definition is rather lengthy. Were there any clauses or terms in there which would give New Line some wiggle room to expand in the direction they want to?

[William Cloud Hicklin]

Where there are lawyers and accountants, there's always wiggle room

[William Cloud Hicklin]

although in very small print:

In our report of the litigation between the Tolkien family and New Line Cinema, producers of The Lord of the Rings (May 25), we did not make it clear that Christopher Tolkien is suing as a trustee of the Tolkien Trust, a registered charity, and the JRR Tolkien 1967 Discretionary Settlement. It was another member of the family who referred to the action as “one last crusade”, not Mr Tolkien, and the hearing on June 6 was to fix a date for the eventual trial, not actually to halt Hollywood plans to film The Hobbit. We apologise to the trustees and Mr Tolkien for these errors.

[ArathornJax]

The court on Friday sustained New Line's Demurrer that the only thing that the suit brought by the Estate only sustains a breach of contract action. I'm sure others can speak to what this means more to me but as I understand it it means that the Estate cannot seek punitive damages against New Line. Interesting . . . still doesn't change the fact that I think New Line needs to honor the contract and pay to the Estate what they are owed.

[Sauron the White]

Does this mean that
1- with the prospect of punitive damages off the table, negotiations towards a settlement should be easier?
2- the prospect of stripping NL of film rights is either removed or significantly lessened?
3- the California courts sees this as a mere dispute about money owed as opposed to someone acting in a fraudelent manner?

[ArathornJax]

Voronwe the Faithful over at two other sites states that (he is a lawyer in CA) he believes that yes, it could make it easier for the Estate to settle in time with New Line at a reduce amount probably, and that is what will probably happen next year. The prospect of stripping New Line is still in play but may be unlikely as he points out that the ruling "does show that the judge does not seem to be sympathetic to the plaintiffs' rather over the top legal positions. I think the judge, like myself, sees this as a straightfoward breach of contract case. But it certainly can be very tricky to predict what a judge will do on one issue based on what she does on other issue."

The court found that the compliant supports nothing more than a breach of contract cause of action, so no fraud was attempted. The plantiffs (the Tolkien Estate and their lawyers) have 20 days now to amend the compliant to show new evidence of fraud, something probably unlikely.

It would be nice to if New Line would just pay what they owe the Estate, but I guess that is the issue, how much they feel they actually owe the Estates, or how little they can get away with paying them. Again though this is only round one of a very long fight more than likely.

[davem]

More here:
http://www.latimes.com/entertainment...,2775685.story

[Sauron the White]

Good article.