a) New Line is trying to strong-arm Jackson into dropping the lawsuit;
b) Jackson is trying to strong-arm New Line into settling the lawsuit;
c) Jackson doesn't want to work with New Line anymore, so he's been using the lawsuit as a pretext to stall until the rights revert to Saul Zaentz - now that New Line is calling his bluff, he has to get MGM to pull out, hence the announcement to stir up the fans;
d) MGM doesn't want to split the deal with New Line, so they cooked this scheme up with Jackson from the start.
I'm going to give Jackson the benefit of the doubt and plump for a). But it's interesting to consider the alternatives.
Now if you want Jackson on board, you can't appeal to New Line's kindness - you have to appeal to them on a business level. So the sensible thing is to widely propagate a boycott of all New Line movies (and all Time Warner products?) until they sign him.
Of course, this won't make any difference if it's d), but it'll help for a), b) or c).
The other solution is to persuade George Lucas to buy New Line and give Jackson the green light, thus redeeming himself and unifying LOTR and SW fandom.
