http://www.nytimes.com/2008/02/12/business/media/12movie.html?ref=business February 12, 2008 Tolkien Heirs Sue New Line Over Millions From Rings By MOTOKO RICH Following in the footsteps of Peter Jackson, the director of the Oscar-winning Lord of the Rings trilogy, heirs to J. R. R. Tolkien, the author of the books on which the films are based, are suing New Line Cinema for failing to pay them at least $150 million, which they say they are owed as part of the movies gross receipts. In a complaint filed Monday in Los Angeles Superior Court, trustees of the Tolkien Trust, a British charity, joined trustees of a private family trust of Tolkien heirs and the British arm of HarperCollins Publishers in suing New Line Cinema for breach of contract. Charging unabashed and insatiable greed, the plaintiffs said in the complaint that New Line, which produced and distributed the Lord of the Rings movies, had failed to pay anything despite a nearly 40-year-old contract that entitles the trusts and the publishers to 7.5 percent of the films gross revenues, less certain costs. According to the complaint, the three movies generated about $6 billion in box office receipts and ancillary revenues from DVD sales, cable television licensing fees and other sales, although Steven Maier, the British-based lawyer for the trustees, said they had not been allowed to audit the receipts from the second and third films. In the complaint, the plaintiffs argue that New Line has clearly engaged in the infamous practice of creative Hollywood accounting, by excluding certain revenue from calculations and racking up costs that have so far prevented the studio from paying out a single dime. I think that its going to be extremely interesting to see how New Line is going to explain to a jury that these films grossed $6 billion and yet by their calculations the creators heirs are not going to get even a single penny, said Bonnie Eskenazi, the United States lawyer for the trustees. A spokesman for New Line declined to comment. According to the complaint, the trustees and a predecessor to HarperCollins signed a contract with United Artists in 1969 for the film rights to The Hobbit and The Lord of the Rings trilogy. The trustees and the publisher were entitled to a 7.5 percent share of the gross receipts. New Line eventually inherited the rights to make the movies in 1998. Mr. Jackson sued New Line in 2005 and settled last year, paving the way for New Line, owned by Time Warner, to produce two movies based on The Hobbit, with Mr. Jackson serving as the executive producer. In the current lawsuit the plaintiffs are also seeking unspecified punitive damages and are asking the court to terminate New Lines rights to make any subsequent films based on The Hobbit or The Lord of the Rings.