Fans of J.R.R. Tolkien's Lord of the Rings series are undoubtedly familiar with the connotations of "The Hobbit," but presumably they do not immediately think of a little pub in Southern England. This potential confusion, and use of the name of the business without permission, are what led the owners of the copyrights and trademark rights to file suit against the neighborhood establishment.

The pub has been operating for over 20 years, and has several drinks named after characters in the series,and even a picture of Elijah Wood as Frodo Baggins appears on its loyalty card. The Saul Zaentz Company (SZC), the holder of the copyright and trademarks, recently sued the pub for infringing on its rights, including the name of a film it is set to release also entitled, "The Hobbit."

Apparently, according to public "outcry," including a facebook group with over 50,000 fans in support of the pub, the SZC has allegedly suggested an amicable end to the dispute,  by offering to license the pub for a relatively discounted fee of $100 per year. It has additionally been reported that the actors Stephen Fry and Sir Ian McKellen, both of whom are set to appear in the upcoming Hobbit films, have offered to demonstrate their support for the pub by paying the licensing fees themselves.

I find the conclusion in this case interesting. It is definitely a situation in which the holder of the intellectual property rights is creating value by not strictly enforcing its rights. The explanation for this position, aside from the public's general disdain, is because the pub probably poses no real threat to the SZC. They aren't producing movies with the same plot line, nor presumably memorabilia with any meaningful revenue stream. In fact, its probably because they are selling alcohol and an perhaps even an experience meant to capture what the enterprise attempts to create, that the pub goers may even proliferate further patronage of the Hobbit brand. Thus, the brand name is only being re-enforced further, to the ultimate profitability of the Hobbit line of films.

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