The fine line between stupid and brilliant has been walked again, but it’s unclear which side Hannover House will fall on just yet. We reported late last week that the company would team with Red Bear Entertainment to deliver an animated, 3D, Pg-13 Terminator film that used characters from the original film. In short, a naked cartoon Arnold.

That apparently didn’t set well with, you know, the people that own the rights to the franchise, and lawyers for Pacificor sent a cease and desist letter to Hannover House last Friday.

Find out what exciting legal jargon has either stalled or ensured the film’s creation:

According to Deadline Huntsville, the ultimatum is as follows:

“The purported development deal, among other things, violates the U.S. Copyright Act, 17 U.S.C. § 101, et. seq., constitutes trademark interference and can result in civil penalties. Accordingly, we demand that Hannover House, TDGI and/or Red Bear Entertainment: (1) immediately issue a retraction clearly indicating that Pacificor had no knowledge of the development venture and that its approval has not been sought nor obtained; (2) stop issuing press releases mentioning the purported development venture and the Terminator Franchise unless and until approval for such a venture is obtained from Pacificor; (3) notify this office in writing not later than five days after your receipt of this letter of your compliance with these demands.”

In layman’s terms:

“Stop making the movie and stop saying you’re making the movie or we’ll sue the living daylights out of you.”

Special thanks to Google Legal Translator for that one.

Of course, this is one of the more bizarre moments in film development history, and it will be even more bizarre if the film ultimately gets created because of the announcement and threatened lawsuit. A representative from Hannover House, Eric Parkinson, noted that he’ll be meeting with Pacificor with the promise of delivering them a “$20 million to $30 million rights payment” if they can work out a deal.

Theoretically, it could be because of the premature announcement that Hannover House gets their meeting and gets the sign off on making the film.

However, this whole thing seems even more absurd considering that Hannover House is a minor distributor with almost zero notables under its belt. The closest thing it has to anything recognizable to a film audience would either be Hounddog from 2007, recent release Twelve, or the Sundance favorite happythankyoumoreplease.

It’s also a company whose reported 2009 Net Income $486,ooo. Granted, it’s working with financial backers, but essentially a boutique distributor is looking into a $70 million production for an internationally known franchise and promising giant rights payments.

At least from the outside, this makes little sense.

If there’s an announcement of the film going forward, it’ll make even less.

What the?

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