Kiwi director Peter Jackson says he has been dumped from two Lord of the Rings movies – The Hobbit and another Rings prequel – by movie studio New Line.
In an email sent to fansite theonering.net, Jackson and partner Fran Walsh said New Line was now "actively looking to hire another filmmaker for both projects".
The email said the demise of the partnership was due to an ongoing lawsuit with New Line over income from the first Lord of the Rings film, The Fellowship of the Ring, and a "limited time option" on the rights to make the films.
It said Jackson and Walsh had planned to begin "development and design" on the two new Rings films next year while filming The Lovely Bones, and once the lawsuit had been dealt with.
Jackson apologised to Rings fans, saying he was "very sorry our involvement with The Hobbit has been ended in this way".
"This outcome is not what we anticipated or wanted, but neither do we see any positive value in bitterness and rancor," Jackson said.
"We now have no choice but to let the idea of a film of The Hobbit go and move forward with other projects."
A posting under the email by 'Xoanon' said it felt like "there had been a death in the family" and whoever ended up directing the movies had "big shoes to fill".
Jackson and Walsh's full email is published on theonering.net.