Peter Jackson will not be at the helm of the Lord Of The Rings Trilogy "prequel" The Hobbit due to a legal dispute between Jackson and New Line.

An ongoing lawsuit involving compensation owed to Jackson for his work on Fellowship of the Ring stands in the way as New Line is unable to talk to the director until the dispute is resolved. 

Because of the limited time that New Line has the rights to make the film they are forced to seek a different director for the film. No word yet on who will take Jacksons place in what are surely large shoes to fill.