New Line takes its punishment in 'Rings' case

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New Line won't fight a federal court judge's decision to hit the studio with $125,000 in sanctions for failing to turn over documents in the ongoing legal battle with Peter Jackson and his Wingnut Films.

New Line could have challenged the ruling, but in a three-page response filed Tuesday, the studio's attorney Robert Schwartz wrote, "Mindful that the court's resources are valuable and limited, New Line will neither oppose that award nor seek review" of the order.

Jackson claims that New Line has not properly accounted for income for the first "Lord of the Rings" film, including DVD sales and foreign receipts, and denied his repeated requests to audit "The Two Towers" and "The Return of the King."

The lawsuit has strained relations between Jackson and New Line and any hopes of the director taking on the trilogy's prequel, "The Hobbit."

The studio's decision comes two weeks after U.S. District Court Magistrate Judge Stephen Hillman issued a terse 40-page order blasting New Line for ignoring repeated court orders to turn over several different types of documents, including e-mails, memos and internal correspondence, in the ongoing case.

"New Line's repeated and unequivocal certifications that is has fully complied with the court's discovery orders have been seriously misleading and obfuscatory," Hillman wrote.

New Line, however, "firmly believes it acted in good faith and that its positions were supported by the law, the evidence and the court's prior rulings," Schwartz wrote.

The trial is set for January.
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