The Hobbit curse has struck again, with JRR Tolkien's estate suing the film's producers to the tune of $98m for overstepping rights for Lord of the Rings merchandising and property.

Hollywood Reporter, which has obtained a copy of the law suit filed in a United States district court in Los Angeles yesterday, reports the Tolkien family and publisher HarperCollins allege Warner Bros, New Line, and Saul Zaentz Co - which holds the rights to Rings and The Hobbit -  have infringed the copyright and breached a contract.

The lawsuit, filed just over a week out from The Hobbit premiere in Wellington, is for US$80m, or NZ$98m, in damages plus an injunction on games and other products that allegedly breach the agreement.

The estate is arguing that  agreement only allows the studio to create ''tangible'' merchandise, as opposed to an ''online slot machine'' or other digital works that are allegedly offensive.

''The original contracting parties thus contemplated a limited grant of the right to sell consumer products of the type regularly merchandised at the time such as figurines, tableware, stationery items, clothing and the like,'' the lawsuit says.

''They did not include any grant of exploitations such as electronic or digital rights, rights in media yet to be devised or other intangibles such as rights in services.''

The estate said it only learned of the existence of  Lord of the Rings: The Fellowship of the Ring: Online Slot Game via a spam email in 2010.

That caused it to investigate and discover Warners was planning real-world slot machines with Rings characters.

It was also planning other products that fell outside the original agreement, the estate claims.

- © Fairfax NZ News