And at this point, that federal judge agrees with them.
Warner Bros, obviously, cries foul. They point out that several studios have tried to develop the property for years, with Fox saying nary a word, and passed up the chance to properly reacquire the rights some time back. Their view of the lawsuit is that it's just an opportunistic grab on a movie that has been gaining more and more buzz. You can read the whole legal chronology over on Deadline Hollywood (Finke's done a top-notch job of documenting the ins and outs) and see which side you come down on. It's exhausting -- isn't this what studios have lawyers for? To avoid this kind of last-minute litigation lunacy?
It's unlikely that the movie will really be delayed -- but it is possible that Warner Bros. will have to hand Fox a substantial chunk of change in order to release the film, as they had to do for Dukes of Hazzard some years back. As one of Finke's readers noted, suddenly the Harry Potter and the Half Blood Prince schedule shift makes a lot more sense. The studio's 2009 budget could be pretty tight.
Watchmen opens (hopefully) March 6th, 2009.