Peter Jackson's 'Lovely Bones' changes hands

Up in the Air” is one of the lucky ones. Nurtured and greenlit by DreamWorks, it will now get made and released as a bonafide Paramount picture.

But at least the people attached to that movie know their fate. Countless others involved with some 200 projects developed by DreamWorks are sitting on tenterhooks as they await news: Will they go with DreamWorks, with Paramount or into turnaround?

One of the most prominent talents caught in the middle of the confusion is Peter Jackson, who pacted to do his $65 million adaptation of Alice Sebold’s “The Lovely Bones” for DreamWorks following a heated auction. Now, DreamWorks is leaving his movie behind, one of the many abandoned children in the messy divorce from Paramount. Jackson screened his cut of the movie, which is set for release in late 2009, for Paramount last week. They’re in charge of it now.

DreamWorks attorney Skip Brittenham and Paramount vice-chairman Rob Moore only started to untie the Gordian knot that was DreamWorks-Paramount over the past week. The process has left knots in the stomachs of many.

Of 33 active, well-developed DreamWorks projects, Steven Spielberg and Stacey Snider ponied up about $17 million for 16-17 they will produce, such as “Cowboys and Aliens.” Paramount has the right to cherrypick the ones it wants to co-finance.

Another 17 pictures — including “The Rivals,” starring Nicole Kidman and Marion Cotillard — stay at Paramount, with Spielberg able to co-finance which ones he chooses. If he doesn’t co-finance, and he’s a producer or director on any of those projects, he’ll get his 7.5% gross deal.

Even though “Up in the Air” producer Montecito Pictures has enjoyed a mutually beneficial decade with DreamWorks, the firm will not make the move. That’s because Ivan Reitman and Tom Pollock’s company has indie financing that Paramount needs more than DreamWorks. So their 25 projects will stay at the studio. And Montecito and Paramount are better positioned to deliver on their brand of genre films (“Hotel for Dogs,” “The Uninvited,” “I Love You, Man”) which don’t demand the DreamWorks touch.

In working out an amicable settlement, Paramount also sees an upside in that many execution-dependent movies will benefit from Spielberg and Snider’s creative and financial investment. As one Paramount exec said last week, “We’re going to be in business a lot together. We have the right to partner on any movie they greenlight until the end of next year. That’s a long time.”

But while the structure of the divorce deal is clear, and word trickles out on who and what goes where, there is still much to be straightened out.

Besides Jackson, DreamWorks production head Adam Goodman is still negotiating the terms of his move to Paramount to supervise the DreamWorks pics. The studio has not yet defined his title and contract. He won’t be reporting to production prexy Brad Weston; he’ll be working alongside him.

“Paramount is a war zone,” says one literary agent whofrets about the projects that have stalled during the divorce. “It never gets better there, it only gets more complicated.”

Mired in the Paramount confusion is Jackson’s “The Lovely Bones,” starring Saoirse Ronan, Rachel Weisz, and Mark Wahlberg, as well as his planned collaboration with Spielberg, the $135 million “Tintin.” Now that Universal has declined to partner on the latter pic and Paramount has put an offer on the table to fully finance (without the players’ usual rich deals), rival studio offers are being weighed.

The studio that does land the 3-D animated “Tintin” will be the one that wins approval from both Spielberg and Jackson, who may be now less willing to give up his deal, partly because he went through an ugly lawsuit with New Line Cinema over monies owed on “The Lord of the Rings.” “Tintin’s” start has been delayed, and cast members lost, including Thomas Sangster as Tintin, while the parties look to lock in a deal.

Going forward with 10 completed DreamWorks projects, Moore recognized he might as well have Spielberg and Snider on board, even on the Jackson-produced “Lovely Bones.” Because Spielberg took an executive producer credit on the film, he retains marketing consulting rights in any case. But Moore saw the value of having Snider continue to represent Jackson’s interests on the movie, since no one at Paramount has a close established relationship with the filmmaker.

Snider’s continued involvement on the pic is why Jackson and his manager, Ken Kamins, aren’t freaking out.

“The separation of Paramount and DreamWorks notwithstanding, our impression is that the transition as it relates to ‘The Lovely Bones’ will be a smooth one,” says Kamins. “We’re confident that Paramount and DreamWorks will continue to work cohesively on shepherding the film to the marketplace.”

DreamWorks leaves behind 10 movies in various states of post-production, all of which will carry the company’s logo when they’re released over the next year. That roster include Parkes/MacDonald’s romantic comedy “She’s Out of My League”; the Eddie Murphy comedy “A Thousand Words”; and two Oscar hopefuls: Sam Mendes’ “Revolutionary Road,” starring Kate Winslet and Leonardo DiCaprio, and Joe Wright’s “The Soloist,” starring Robert Downey Jr. and Jamie Foxx.

Moore asked Snider tocontinue to consult on the marketing of both “Soloist” and “Road.”

“We’ve had a good relationship on the marketing and distribution side and we expect that to continue,” says Moore.

Obviously, players like Jackson, Mendes, producer Scott Rudin and Joe Wright are going to be looked after. But there are many second-tier players who aren’t necessarily attached to favorite passion projects who have lost valuable momentum in this six-month transition. They could see their movies founder or fall from sight altogether.

Meanwhile, producers MacDonald/Parkes, Nina Jacobson and Roberto Orci and Alex Kurtzman are moving with DreamWorks. (Still to be confirmed is the route of Ben Stiller’s Red Hour.) But how many of their projects will go with them? Parkes/MacDonald’s “Dinner for Schmucks” and “Trial of the Chicago 7″ will go with DreamWorks, but left behind is a sequel to “Lemony Snicket,” because all potential films in that series belong to Paramount.

“Transformers 2: Revenge of the Fallen” carries a different status outside the agreement as a Paramount-DreamWorks co-production, as does the remake “When Worlds Collide,” which Spielberg will produce.

Meanwhile Spielberg is lining up his directing projects: After “Tintin,” his next likely pic is “Lincoln,” written by Tony Kushner and slated for a spring start with Liam Neeson in the title role. More remotely possible gigs include family pic “The 39 Clues” and the recently acquired “Chocky.”

Spielberg, of course, can always change his mind.

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