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Warner Bros. Claims Tolkien Lawsuit Cost It ‘Hobbit’ Deals

Warner Bros. has added new fodder to its counterclaim against the estate of J.R.R. Tolkien, which contends that the studio overstepped its bounds in merchandising “The Lord of the Rings” and “The Hobbit.”

In a filing this week, Warner Bros. says it has lost out on “millions of dollars in license fees” from online “Hobbit” games and casino slot machines because of the “cloud over the rights.” The Tolkien estate sued the studio, New Line and the Saul Zaentz Co. in November, claiming that it never granted such online and gaming rights, and in late January Warner Bros. countersued.

“Warner has invested considerable time and money into plans for further exploitation of the [Tolkien] works that it has now had to delay, reconsider and perhaps cancel altogether as a result of [the estate’s] repudiation of Warner’s rights under the 2010 Regrant Agreement,” the studio said in its filing.

Because of the “repudiation,” the studio said it had to cancel a license agreement with Microgaming, and had to pay a portion of its development and advertising costs. As it did when it filed its counterclaim in January, Warner Bros. says that the estate is claiming that it didn’t grant online rights as a way to extract more money, or “yet another multi-million dollar payday. ” Along with New Line and Zaentz, Warner Bros. claims that the estate has long acknowledged they had granted the online rights. The estate claims that it never granted such rights, and cites the limitations of a 1969 agreement.

The estate will be responding in its own filing, but a point they made in their original complaint is that the exploitation has gone too far: The author’s son, Christopher Tolkien, has publicly decried the commercialization of his father’s works.

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