‘Watchmen’ Lawsuit May Spell Big Trouble For Film

Breaking news out of Hollywood — this time from the legal sector — which could spell big trouble for “Watchmen.”

According to Deadline Hollywood, a federal judge has denied a Warner Bros. motion to dismiss 20th Century Fox’s legal battle over the rights to develop, produce and distribute a film based on the classic graphic novel by Alan Moore and Dave Gibbons. While the legal jargon is a bit, uh, too legal, it appears that Fox retained distribution rights to the film through a 1991 claim, and although producer Larry Gordon acquired an option to acquire Fox’s remaining interests, that option was never exercised, thus leaving Fox with distribution rights.

So what does this mean?

Basically, it means that Fox could stand to make millions — and likewise, Warner Bros. could lose as much — as a participant in the film, which stands to do quite well at the box office. This also spells huge trouble for Warner Bros. in terms of “Watchmen” being, quite possibly, their big movie of 2009, and it may disrupt their entire line-up of the coming year’s slate of movies. According the source material, a similar situation happened to Warner Bros. around the “Dukes of Hazzard” release, where the company had to pay millions just to release the film.

Stay tuned, as this story is only heating up.

UPDATE: The legal documents behind this case have hit the web for those who like comics AND studying for law school.

Okay, all you armchair lawyers out there — what do you think of these recent developments? Let us know in the comments.