New Line Cinema (now a part of Warner Brothers) and the Tolkien Estate have reached a settlement in their legal battle over the Lord of the Rings films. This means the upcoming film adaptation of The Hobbit will not be axed on account of some monetary squabbling.

The Tolkien Trust’a British charitable trust representing the estate of J.R.R. Tolkien (1892-1973) “sued to stop the further production of films based on the author’s work, and sought payment of at least $220 million based on the three Lord of the Rings films directed by Peter Jackson and released by New Line (a division of Warner Brothers). Their claim was that, under a 1969 contract, the trust and the other Tolkien heirs are entitled to 7.5% of gross receipts from films and related products.”

This is good news for LOTR fans everywhere. The two Hobbit films will continue as planned.