So, we have the Tolkein Trust suing New Line and now we have Fox suing Warner Bros. as they claim to have exclusive rights to develop, produce and distribute a film based on the graphic novel "Watchmen," a film in which Warner Bros. is currently filming and has already set a 2009 release. Hmmm, quite a predicament eh? I mean, really, what do you do in this situation? My only guess would be for Fox to ask for a portion of the gross receipts, but then again if they technically own the exclusive rights they could ask for 100% of the receipts. This is all speculation of course since the lawsuit seeks unspecified damages.

One thing is for certain, Fox seeks to enjoin Warners from going forward Watchmen, saying in the lawsuit that it seeks to "restrain (Warner Bros. Pictures) from taking actions that violate Fox's copyrights and which stand to forever impair Fox's rights to control the distribution and development of this unique work." Yikes!

Fox claims that between 1986 and 1990, it acquired all movie rights to the 12-issue DC Comics series and screenplays by Charles McKeown and Sam Hamm. In 1991, Fox assigned some rights via a quitclaim to Largo International with the understanding that the studio held exclusive rights to distribute the first motion picture based on "Watchmen," according to the lawsuit.

When Largo dismantled, the rights were transferred to producer Lawrence Gordon. Under a "turnaround agreement" between Fox and Gordon, the producer agreed to pay a buy-out price to Fox if he entered into any agreement with another studio or third party to develop or produce "Watchmen," among other things.

The project apparently bounced around to Universal and Paramount before returning to Warners. Now, Fox claims that neither Gordon nor Warners has paid the buy-out price or advised the studio of any other conditions required under the agreement, including procedures necessary to acquire the rights to "Watchmen" from Fox.

Quite a sticky situation if you ask me and one we will have to keep our eye on closely.