Today we have some great news for those looking forward to the upcoming adaptation of The Hobbit (and who isn’t?): the project can officially go ahead as the Lord of the Rings lawsuit filed long ago by the Tolkien estate has now been settled.

The Hollywood Reporter is reporting that New Line Cinema, publisher Harper Collins and the Tolkien estate have come to an agreement in the lawsuit over profits from the three Lord of the Rings films. The quick overview of what the lawsuit was about is as follows: the Tolkien estate sued New Line for damages of at least $150 million because the studio failed to pay the 7.5% of gross receipts that they were supposed to get from what the three LOTR movies made, which combined came to about $6 billion (yowza!).

The estate claimed that it hadn’t been paid “one penny” of what they were owed by the studio. They also had a problem with a lot of the studio’s claimed expenses, some of which included “advertising” payments to AOL, as well as money for production offices and facilities being used for other New Line projects. When the lawsuit was filed by the estate, they also requested a court order that would allow them to stop any productions New Line had planned which are based on any Tolkien works, including The Hobbit.

Although details of the settlement are being kept under wraps, Christopher Tolkien (J.R.R’s eldest son) had the following to say by way of a press release:

“The Trustees regret that legal action was necessary, but are glad that this dispute has been settled on satisfactory terms that will allow the Tolkien Trust properly to pursue its charitable objectives. The Trustees acknowledge that New Line may now proceed with its proposed films of ‘The Hobbit.'”

Warner Bros. President and COO, Alan Horn, had this to add:

“We deeply value the contributions of the Tolkien novels to the success of our films and are pleased to have put this litigation behind us.”

The reason it’s important that the lawsuit has finally been settled is that even though The Hobbit was going into production (as far as we all knew), there may have come a time when the Tolkien estate had the right to terminate it. Just imagine that for a second: director Guillermo del Toro, along with Peter Jackson and whoever they put in place as the primary cast are all underway with production, and out of nowhere it gets shut down because of a lawsuit over (when it comes down to it) money.

Fan reaction would have been worse than if The Joker was recast for the next Batman movie

Having said that, did anyone really think that the lawsuit wasn’t going to eventually be settled? The Hobbit is one of the most anticipated movies on the horizon (if not THE most anticipated), and is undoubtedly the biggest project that the studio has in the pipeline at the moment. Were they really going to let someone stand in their way if it was just a question of money?

Although, as stated, no details were made available about the settlement, it appears the studio has done the right thing, cut the Tolkien estate their precious (get it?) check and put it all behind them. And now so should we.

What do you think about the Lord of the Rings lawsuit finally being settled: Was the Tolkien estate right to want a court order that could’ve stopped The Hobbit because they weren’t paid what they were owed? Let us know in the comments below.

The Hobbit is now officially able to go ahead, with Part 1 scheduled for a December 2011 release, and Part 2 following a year later in December, 2012.

Source: THR