The estate of fantasy writer J.R.R Tolkien has reached a settlement with the studio behind the "Lord of the Rings" movies after alleging it had not received "even one penny" of royalties from the trilogy of money-spinning films, officials said Tuesday.
The legal dispute had threatened to disrupt production of "The Hobbit," the eagerly anticipated prequel to the "Lord of the Rings" which is due to begin filming in 2010.
An attorney for the Tolkien Trust, which together with HarperCollins Publishers had filed a lawsuit against New Line Cinema in February 2008, said the settlement was finalized ahead of a scheduled October 19 trial.
The terms of the settlement are confidential.
The settlement was welcomed by J.R.R. Tolkien's youngest son, Christopher Tolkien, on behalf of the trust.
Tolkien said he and other trustees "regret that legal action was necessary, but are glad that this dispute has been settled on satisfactory terms that will allow the Tolkien Trust properly to pursue its charitable objectives."
"The trustees acknowledge that New Line may now proceed with its proposed films of 'The Hobbit,'" Tolkien said in a statement.
Alan Horn, Warner Bros. president and chief operating officer, said he was pleased agreement had been reached ahead of a trial. New Line is now part of Warner Bros.
"We deeply value the contributions of the Tolkien novels to the success of our films and are pleased to have put this litigation behind us," Horn said. "We all look forward to a mutually productive and beneficial relationship in the future."
The "Lord of the Rings" films produced by New Line were released in 2001, 2002 and 2003, respectively, and all were major box office hits.
The three films have grossed around three billion dollars at the worldwide box office.
However lawyers for the Tolkien Trust said in February 2008 that the author's estate had received no slice of the profits.
"I cannot imagine how on earth New Line will argue to a jury that these films could gross literally billions of dollars, and yet the creator's heirs, who are entitled to a share of gross receipts, don't get a penny," lawyer Bonnie Eskenazi said in a statement at the time.
Lawyers had been seeking 150 million dollars in compensatory damages, punitive damages and the right to strip New Line of its right to make any further films based on Tolkien's work, including the "The Hobbit."
