Trustees of the author JRR Tolkien are suing a film studio for $150 million (£75 million) for unpaid profits from The Lord of the Rings films, it emerged yesterday.
The Tolkien Trust and Harper Collins, who originally published the trilogy, filed a lawsuit against New Line Cinema in Los Angeles Superior Court.
It claims New Line was required to pay 7.5 per cent of gross receipts from the films to Tolkien's estate and other plaintiffs.
The three films - The Fellowship of the Ring, The Two Towers and The Return of the King, which won 11 Oscars in 2004 - netted nearly $6 billion (£3 billion) worldwide.
But Oxford-based law firm Manches, representing Tolkien's estate in Britain, claims New Line only paid an upfront fee of $62,500 (£32,000) for the fantasy blockbusters.
The lawsuit, which is claiming compensation and punitive damages, could also delay work on a two-part prequel based on The Hobbit, which was due to start production in 2009, for release in 2010 and 2011.
Director Peter Jackson, who was behind the Lord of the Rings trilogy, has already signed up to make the two films, after resolving his own legal battle over unpaid profits with the studio last year.
Steven Maier, of Manches, said trustees "do not file lawsuits lightly".
"They have tried unsuccessfully to resolve their claims out of court," he said. "New Line has not paid the plaintiffs even one penny of its contractual share of gross receipts despite the billions of dollars of gross revenue generated by these wildly successful motion pictures."
Mr Maier also claimed the film studio had blocked the Tolkien estate from auditing the receipts of the The Two Towers and Return of the King, released in 2002 and 2003.
"Negotiations have been wholly unsuccessful, New Line are not prepared to make any realistic proposals, which is why we're now taking legal action," he said. "Obviously the Tolkien family, as trustees, feel shocked, hurt and angered at the way they have been treated by New Line."
No one from New Line, a unit of Time Warner, was available for comment.
The lawsuit claims JRR Tolkien established a trust through which he signed a film deal in 1969 with United Artists, and after the author's death, his heirs created the Tolkien Trust charity.
However, the original agreement terms were picked up by Hollywood producer Saul Zaentz, who produced an animated film in 1978 based on the trilogy, and eventually licensed the rights to make live-action films to New Line.
Other disputes over the film's earnings have surfaced in recent years.
In 2004, Mr Zaentz sued New Line, claiming the studio cheated him out of $20 million in royalties from the film trilogy, which he optioned to New Line for a percentage of the movies' profits. He and the studio reached an out-of-court settlement a year later. Jackson's production company Wingnut also tangled with New Line in 2005 over profits from the first film which made $291 million (£152 million), plus revenue from merchandise, computer games and video rights.
That lawsuit was settled last year before the studio announced in December that Jackson had agreed to direct The Hobbit.
Fifteen New Zealand actors also claimed, last June, that New Line had broken an agreement to give them five per cent of an estimated $100 million (£50 million) from sales of caps, games and other merchandise.