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The twist to the argument is that, for now, the studio owns rights to the LOTR prequel The Hobbit. Fans are keen for Jackson to make the movie, as is he, but chief Bob Shaye has said: "It will never happen during my watch."
Jackson, and his company Wingnut Films, have launched a lawsuit against New Line, claiming that they have not been paid what they are owed for the Fellowship of the Rings trilogy.
"Our issue with New Line Cinema has only ever been about their refusal to account for financial anomalies that surfaced from a partial audit of The Fellowship of the Ring," Jackson said in a statement. "We attempted to discuss the issues raised by the Fellowship audit with New Line for over a year but the studio was and continues to be completely uncooperative.
"It is regrettable that Bob has chosen to make it personal," he continued. "I have always had the highest respect and affection for Bob and other senior management at New Line and continue to do so."
When asked about the prospect of Jackson working on The Hobbit, Shaye blasted: "I do not want to make a movie with somebody who is suing me. It will never happen during my watch.
"He got a quarter of a billion dollars paid to him so far, justifiably, according to contract, completely right, and this guy, who already has received a quarter of a billion dollars, turns around without wanting to have a discussion with us and sues us and refuses to discuss it unless we just give in to his plan."
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