In a defiant statement issued Monday, Warners said it was prepared to go to trial or to appeal last week's ruling by U.S. District Court Judge Gary Feess, who stated that the studio had infringed on Fox's copyright in making the adaptation of the Alan Moore superhero graphic novel.
"We respectfully but vigorously disagree with the court's ruling and are exploring all of our appellate options," the studio said. "We continue to believe that Fox's claims have no merit and that we will ultimately prevail, whether at trial or in the Court of Appeals."
Fox, meanwhile, is looking for an injunction against the March 6, 2009, release of the movie.
"Watchmen," directed by Zack Snyder ("300"), is one of Warners' tentpoles for next year, with a budget well north of the $120 million. While it is considered a seminal piece of literature with an appeal beyond the geek community, Warners has been carefully implementing a publicity campaign to generate word-of-mouth and awareness of the movie.
Both sides met Monday morning at the Los Angeles federal court, where Feess said he stands by the Christmas Eve ruling and also said he plans to hold a trial Jan. 20 to decide remaining issues such as damages, how far Fox's rights extend, and if to actually block the release of the movie.
Monday's events seem to be a speed bump to a costly settlement, with the hardline postures likely a strategic move for both sides more than anything else. Fox, which finally snapped a long boxoffice losing streak with "Marley & Me," gains most with a settlement, not a blocked release; the studio is already taking a beating in the geek blogosphere for messing with a fan-favorite property. Warners, meanwhile, could be on the hook for millions for developing and then filming a movie in which the film's producer, Larry Gordon, didn't pay Fox turnaround fees after allegedly reacquiring rights to the property.
"We are gratified by the recognition of our rights in the Judge's order, which speaks for itself," Fox said in a statement.