The Hobbit in July 2007?

[Mister Underhill]

This is excerpted from a longer article in today's Variety that's mostly about films that MGM actually is doing:

As for "The Hobbit", [MGM Chief Harry] Sloan confirmed that MGM was in talks with Peter Jackson to make two movies based on J.R.R. Tolkien's "prequel" to "The Lord of the Rings".

However, making the film is contingent on negotiations with New Line, which owns the right to produce "The Hobbit" (MGM owns only the right to distribute the films). And people close to Jackson say that until his ongoing lawsuit with New Line -- over monies he says are owed him from the "Lord of the Rings" franchise -- is settled, a serious conversation over "The Hobbit" cannot proceed.

Even so, Sloane remains optimistic. He said the first "Hobbit" pic would be a direct adaptation of "The Hobbit", and the second would be drawn from footnotes and source material connecting "The Hobbit" with "The Lord of the Rings".