Slashdot Mirror
LoTR Lawsuit Threatens Hobbit Production
eyrieowl writes "J.R.R.'s heirs are suing for royalties on the LoTR films. Apparently they haven't gotten any money due to some creative accounting. Peter Jackson ought to understand...he had to sue the studio for much the same reason.
As for The Hobbit? FTFA: 'Tolkien's family and a British charity they head, the Tolkien Trust, seek more than $220 million in compensation...[and]...the option to terminate further rights to the author's work.'"
Looks like the deal was done maybe 40 years ago:
Under the contract, New Line was to pay a percentage of all gross receipts, after deducting 2.6 times the production costs, plus advertising expenses in excess of a certain amount, according to Eskenazi. (from TFA)
Nowadays it seems as though even the average slashdotter knows you take a portion of gross, because nothing involving MPAA or RIAA related-companies ever clears a 'net profit' (wink wink).
It looks like Tolkien & co where less saavy 40 years ago, and essentially signed up to get screwed. I hope the movies were profitable enough that they can still clear some money for the family, but 2.6 times production costs of those movies is a hell of a lot, and 'advertising expenses in excess of a certain amount'- especially if that amount was a 1969 dollar amount, and not a percent-well, they could really end up with a contractually dictated 'nothing.'
Alcohol, Tobacco and Firearms should be the name of a store, not a government agency.
Unfortunately, you aren't a Hobbit, and this kind of stuff is so common it has it's own name and Wikipedia entry. Look up Hollywood Accounting. It's pretty simple and extremely sleazy. Remember that profits are simply income minus expenses. If you make $100,000 but it costs you $40,000 in expenses, you have $60,000 in profits.
Most movie earnings are reported in gross sales. Profits are slim, on purpose.
Let's say you are a Hollywood producer.
1) Make a deal with somebody to "share the profits" by using their idea.
2) Produce the movie by hiring sub-contractor "companies" that happen to have you has the CEO. These "companies" are very expensive, and payed based on gross sales.
3) Movie gets produced, makes record sales.
4) The "companies" previously hired are payed based on the sales numbers, leaving no money left to call a "profit".
5) ???
6) Screwed partner makes nothing because there are no profits to share.
I have no problem with your religion until you decide it's reason to deprive others of the truth.
Uh, The Silmarillion and The Children of Hurin. There are tons of notes and papers the Tolkien kept while writing his stories. Many of these offer insight into the world of Middle Earth, and would not have been easily accessible if it wasn't for the work of his son. Christopher Tolkien has spent a great deal of time going through his father's work, assembling notes from various sources to try to provide a more detailed history of Middle Earth. While the heirs aren't responsible for the original tale, they have done there share of work to get the story behind the story out and available to the public. Without the background, creating a movie like LotR would be much more difficult. The entire mythos was not well documented within the confines of the books. There were a lot of details that don't fit nicely within story form that were important to the movie. One of the biggest examples is the Elvish language. Much of the language has been put together from his original notes, which have been assembled by Christopher over the years.
This is definitely not a case were the children are sitting around trying to bum money off of their parent's work. I am very thankful for their contributions. Without their work, my knowledge of Tolkien would probably be limited to The Hobbit and The Lord of the Rings.
Actually, Chris did a goodly amount of work recompiling the whole Middle Earth saga from notes, he tried to fill in unfinished stories of his father. He did try to clarify inconsistencies, add stories, and overall maintain the work that was left behind.
No, he wasn't responsible for the work that these movies is based on directly... But he did become the de facto caretaker of the fictional setting.