Peter Jackson and Fran Walsh expressed interest in 1995 in filming The Hobbit, which would be part one of a trilogy (the other two would have been films based on The Lord of the Rings). Frustration arose when Jackson's producer,Harvey Weinstein, discovered Saul Saentz had production rights to The Hobbit, but distribution rights still belonged to United Artists. The studio was on the market, so Weinstein's attempts to buy those rights were unsuccessful. Weinstein asked Jackson to press on with adapting The Lord of the Rings.MGM bought United Artists, while New Line earned the rights to produce The Lord of the Rings. New Line has a limited-time option on The Hobbit, with their hold on the rights set to expire in 2010.In September 2006, MGM expressed interest in teaming up with New Line and Jackson to make the film.
In March 2005, Jackson launched a lawsuit against New Line, claiming he had lost revenue from merchandising, video, and computer games releases associated with The Fellowship of The Ring. Jackson felt the lawsuit was minor, and that New Line would still let him make the film. New Line co-founder Robert Shaye was annoyed with the lawsuit and said in January 2007 that Jackson would never again direct a film for New Line, accusing him of being greedy. But in August 2007, after a string of flops, Shaye was trying to repair his relationship with the director. He said, "I really respect and admire Peter and would love for him to be creatively involved in some way in The Hobbit." In September, New Line was fined $125,000 for failing to provide requested accounting documents.
On December 18,2007, it was announced that Jackson would be the executive producer of The Hobbit and its sequel. And it was hoped that back-to-back shooting on these films would begin in 2009, and then released in December 2010 and December 2011 respectively. New Line and MGM will co-finance the film, and the latter studio will distribute the films outside North America — New Line's first ever such deal with another major studio.
The Tolkien Estate filed a lawsuit against New Line on February 11,2008, for violating Tolkien's original deal with Saul Zaentz that they would earn 7.5% of the gross from a film adaptation. The Estate is seeking compensation of $150 million, because they were only paid $62,500 before production of the trilogy began. A court order was also filed that would allow the Tolkien Trust to terminate any rights to future films based on Tolkiens work, including The Hobbit and the second derivative prequel.
In April 2008, Guillermo del Toro signed on to direct both pictures, and he will move New Zealand for four years after finishing Hellboy II: The Golden Army to develop the duology with Jackson and the teams at WETA and Wingnut Films. The director met with Ian McKellen, Andy Serkis (who hope to reprise their roles as Gandalf and Gollum respectively), concept artists John Howe and Alan Lee, Weta Workshop head Richard Taylor, make-up artist Gino Acevedo and composer Howard Shore to keep continuity with the previous films. Del Toro said that he thought the world of The Hobbit is a "world that is slightly more golden at the beginning, a very innocent environment ... taking you from a time of more purity to a darker reality throughout the film, but [in a manner] in the spirit of the book". He also intends to push the technology of animatronics to new levels ; "We really want to take the state-of-the-art animatronics and take a leap ten years into the future with the technology we will develop for the creatures in the movie. We have every intention to do for animatronics and special effectswhat the other films (LotR trilogy) did for virtual reality . Producer Mark Ordesky will return to supervise the prequels,and each film will cost around $150 million.The films are now expected for 2011/2012, and the New Line-MGM distribution agreement remains in place.
MGM expressed interest in another prequel film, set between The Hobbit and The Lord of the Rings. Jackson concurred, stating "one of the drawbacks of The Hobbit is [that] it's relatively lightweight compared to LOTR... There [are] a lot of sections in which a character like Gandalf disappears for a while. From memory — I mean, I haven't read it for a while now — but I think he references going off to meet with the White Council, who are actually characters like Galadriel and Saruman and people that we see in Lord of the Rings. He mysteriously vanishes for a while and then comes back, but we don't really know what goes on." Del Toro said the sequel was "an integral part of telling the story of those 50 years of history lost in the narrative. There will be certain things that we will see from the first movie but from a different point of view, but it will feel like a volume, in the five volumes of the entire story." Orlando Bloom, Viggo Mortensen, Cate Blanchett, Elijah Wood, and Christopher Lee have said they would reprise their roles as Legolas, Aragorn, Galadriel, Frodo Baggins, and Saruman if they were required for either prequel. Source:wikipedia.org