Steven Spielberg has officially withdrawn from “Harvey.” He spent the last half year developing the picture to be his first directing vehicle for the reconstituted DreamWorks.

Spielberg delivered the news this week to 20th Century Fox, which had earmarked soundstages on the Fox lot in anticipation of an early 2010 production start. Fox had agreed to have DreamWorks finance 50% of production through its new funding relationship with Reliance, and either distribute domestically or internationally through its arrangement with Disney.

Pic—an adaptation of Mary Chase’s Pulitzer Prize-winning play about a man who befriends a six and one-half foot tall invisible rabbit—has been a challenge to pull together since Spielberg committed last August. One of the biggest challenges has been setting a star for Elwood P. Dowd, a role played in the 1950 film by James Stewart.

Spielberg’s first choice was Tom Hanks, but the actor who is often regarded as a modern day Stewart wanted no part of taking over a role played by the iconic star. Spielberg and Fox spent several months courting Robert Downey Jr. While the “Sherlock Holmes” star never committed, he did make suggestions on rewrites of the Jonathan Tropper script. He and Spielberg never found themselves in creative synch on the script, and the director finally called the whole thing off. 

A spokesman confirmed Spielberg’s exit.

The development is certainly a disappointment for Fox, partly because the project’s trajectory last summer was so dramatic. 20th topper Tom Rothman got the script from his Fox 2000 execs Elizabeth Gabler and Carla Hacken, showed it to Spielberg, and had a yes within days.  

Fox 2000 will continue working on “Harvey” and could re-approach Spielberg and Downey. 

It wasn’t immediately clear which picture Spielberg will direct instead. He completed production last March on “The Adventures of Tintin: Secret of the Unicorn,” and though he has been preoccupied with Stacey Snider in launching the new DreamWorks and godfathering projects like “Transformers: Revenge of the Fallen,” Spielberg is itching to direct the first film for his new partners at Reliance.

There are several homegrown candidates—he’s got such projects at the Abraham Lincoln Civil War film scripted by his “Munich” writer Tony Kushner, and the Jeff Nathanson-scripted “The 39 Clues,” but it’s clear that Spielberg will be reading a lot of scripts over the holidays.

The Reliance-backed DreamWorks recently green lit its first film, the Shawn Levy-directed Hugh Jackman-starrer “Real Steel.”

“There Will Be Blood” writer/director Paul Thomas Anderson has found religion, and Philip Seymour Hoffman, for his next film.

Anderson has written an untitled period drama that is set up at Universal. Hoffman, who has played supporting roles in most of Anderson’s past films, would this time be the centerpiece.

Hoffman will play “The Master,” as in “master of ceremonies,” a charismatic intellectual who hatches a faith-based organization that begins to catch on in America in 1952.

The core is the relationship between The Master and Freddie, a twenty-something drifter who becomes the leader’s lieutenant. As the faith begins to gain a fervent following, Freddie finds himself questioning the belief system he has embraced, and his mentor.

Anderson's treatment of religion was cynical in "There Will Be Blood." Here, the scrutiny isn't specifically directed toward faith-based movements like Scientology or Mormonism that are newcomers compared to established religions. Anderson explores the need to believe in a higher power, the choice of which to embrace, and the point at which a belief system graduates into a religion. . 

Universal, which has become very selective about green lighting adult dramas, won’t make a decision on Anderson’s $35 million budget pic until he delivers his finished script. His hope is to make the picture next year, sources said.

Anderson’s frequent collaborator, JoAnne Sellar, is the producer. 

Hoffman made his breakthrough in the cast of Anderson’s “Boogie Nights,” and has also appeared in the Anderson-directed “Hard Eight,” “Punch-Drunk Love” and “Magnolia.”

Neither the studio nor reps for Anderson or Hoffman would comment.

Universal Pictures has acknowledged that Paul Greengrass has departed a fourth installment of “The Bourne Identity.”

Studio has issued this statement from the director:

Said Greengrass: "You won't find a more devoted supporter of the Bourne franchise than me. I will always be grateful to have been the caretaker to Jason Bourne over the course of The Bourne Supremacy and The Bourne Ultimatum. I'm very proud of those films and feel they express everything I most passionately believe about the possibility of making quality movies in the mainstream. My decision to not return a third time as director is simply about feeling the call for a different challenge. There's been no disagreement with Universal Pictures. The opportunity to work with the Bourne family again is a difficult thing to pass up, but we have discussed this together and they have been incredibly understanding and supportive. I've been lucky enough to have made four films for Universal, and our relationship continues. Jason Bourne existed before me and will continue, and I hope to remain involved in some capacity as the series moves on."

The exit of Greengrass--which first surfaced on The Playlist blog--is certainly a blow to Universal’s attempt to put together a fourth installment of one of the studio’s most important franchises, but it is not necessarily a fatal one.

Franchise-building is a difficult exercise, particularly here, when “Bourne 3” was intended to be the final installment. It did so much global business that the hit-hungry studio sparked to doing another. Universal's progress has been hamstrung by the fact that the creatives were otherwise engaged in directing other movies for the studio—each with Damon as the star.

For instance, Greengrass—who, like Damon, was never officially attached—has been consumed with “The Green Zone,” a big budget film that Universal releases in March.

The development process on “Bourne 4” began with a draft by George Nolfi—who did uncredited writing on the last scene of “Bourne 2” and who wrote “Bourne 3” with Tony Gilroy and Scott Z. Burns. But Nolfi left to make his directing debut on "The Adjustment Bureau,” a Nolfi scripted Damon vehicle which Universal acquired from MRC.

The studio then brought in Joshua Zetumer to write a parallel script, but the movie hasn’t yet taken shape, despite the best efforts of producer Frank Marshall, and Capitivate Entertainment’s Jeffrey Weiner and Ben Smith, who control the rights to the novels of the late Robert Ludlum.

Where does Universal go from here on “Bourne 4?” Two possible scenarios: if Damon is happy with the job that Nolfi did on “The Adjustment Bureau,” he might back Nolfi’s candidacy to return to “Bourne 4,” maybe as director.

There is also Gilroy, another writer-turned-director. Gilroy misfired on the Universal film he directed, “Duplicity,” but he has been the creative catalyst as screenwriter, the only scribe whose name is on all three films. Gilroy could certainly return to rewrite and direct.

The two-week $481 million worldwide gross of “The Twilight Saga: New Moon” has put Summit Entertainment into the big leagues.

It has also created high class challenges for toppers Rob Friedman and Patrick Wachsberger. As they come down from blockbuster euphoria, they are going to have to cut checks larger than most indie companies ever do if they move ahead with a plan to break Stephenie Meyer’s finale, “Breaking Dawn,” into two pictures. 

Sources said Summit has so far only gone as far as setting scribe Melissa Rosenberg--who wrote the first three films--to finish the series, but Summit has to clear several hurdles before telling Rosenberg if she should write one scripts or two.   

Among those hurdles is figuring out whether “New Moon” director Chris Weitz will respond favorably to overtures from the film company and the cast to return and shoot two more films, back to back. 

Summit execs would not comment, but multiple sources said that the film company wants to go the two-film route, which means re-opening negotiations and getting approval from the author. It also means making new deals with a principal cast that is only locked up for four films. If “Breaking Dawn” becomes two pictures, all of the key cast members will get fat raises, and the three principals—Rob Pattinson, Kristin Stewart and Taylor Lautner—could land eight-figure paydays. 

That is what happened the key cast members when Warner Bros. extended its blockbuster Harry Potter franchise by turning J.K. Rowling’s last book, “Harry Potter and the Deathly Hallows” into two films that will be released in November, 2010 and July, 2011.The global success of the franchise made the paydays worthwhile.  

While the solution to most of Summit’s challenges will be determined by its willingness to cut large checks, the prospect of a Weitz return is more complicated.

After feeling violated by New Line’s decision to drastically alter his adaptation of “The Golden Compass,” Weitz said he felt redeemed and reinvigorated by the success of “New Moon.” Yet, just before the film’s release, Weitz was steadfast that he would next direct “The Gardener,” a comparatively tiny film scripted by Eric Eason, with Paul Witt and Christian McLaughlin producing. At the time, he said Summit was in discussions to fund that film.

Summit hasn’t closed a deal for “The Gardener,” probably because the film company wants Weitz to postpone it and work on “Breaking Dawn” instead. Could he possibly resist the chance to finish a global franchise he helped build, even though it will mean more time away from his family for a long shoot? That is the question he and his WME reps will weigh shortly. Though Summit hasn’t officially made Weitz an offer, sources said the job is his if he wants it. After bringing in “New Moon” at around $50 million and keeping the cast happy, he’s the logical choice.

David Slade directed the next installment in the series, “Eclipse,” which bows June 20, 2010.

With Harry Potter and his wizard friends ready to graduate Hogwarts, Warner Bros. has gone back to the cauldron to stir up a new coming-of-age witch franchise.

Studio has acquired “Beautiful Creatures,” the first of a five-novel series by Kami Garcia and Margaret Stohl that is published Dec. 1 by Little, Brown.

Richard LaGravanese is set to write the script and direct the film.

Erwin Stoff will produce.

Ethan Wate, a popular high school student, hates living in a small in South Carolina where nothing happens—until he meets and becomes bewitched by Lena Duchanne, a 16-year old whose family has moved back to town and who wishes for a mundane life.  The star-crossed couple has to confront an age old curse that has haunted her family for generations, as she comes to grips with her powers.

While LaGravanese has written/directed several female-centric films—“P.S. I Love You” is the most recent—this is his first film foray into the supernatural. 

“I love supernatural stories that have well drawn mythologies, and I liked that this book has all the basic elements of a classic first love story with a supernatural layer over it,” LaGravanese said. “So the first time they hear the words boyfriend and girlfriend, they accidentally overhear each other telepathically. Their first kiss comes after he saves her life and their first date is part of a bigger adventure that leads to the unraveling of the mysterious curse that haunts her family.”

LaGravanese most recently scripted “Water for Elephants,” an adaptation of the Sara Gruen novel for Fox 2000 with Francis Lawrence directing and Reese Witherspoon attached to star, and “Liberace,” the Steven Soderbergh-directed pic that has Michael Douglas attached to play the title character and Matt Damon attached to play his lover. Both films are on track to begin production next year.

CAA brokered the book deal with The Gernert Company.
 

David Guillod, who parted ways with UTA over the holidays, is landing at Paradigm.

Guillod had been a partner and  was once co-head of the Motion Picture Talent Department at UTA. until earlier this year. Move is a surprise, as reports had Guillod leaving the representation biz to focus on a venture involving Oni Press, a comic book imprint that the agency represented.  

Paradigm topper Sam Gores issued this memo:

Dear colleagues,

 We are very pleased to announce today that David Guillod will join us at Paradigm.

 David has spent the last 8 years at UTA where he was a partner and the Head of the Motion Picture Talent department and before that was a partner at Handprint. Many of us have known David for several years, going back to his manager days and we are very happy to have him on board.  Even though David has been contemplating a move into the Development Business, he decided after meeting with us over the holiday weekend and some further soul searching that he really loved his clients and being an agent. Last night he decided that the culture and environment at Paradigm is the right place for him to pursue the next chapter of his career.

It is too soon to make any announcements regarding clients but know that David will assume a very senior agent capacity within the agency. 

 David is a great addition to Paradigm’s present and future.  Please join me in welcoming him to the Paradigm family.

 Sam

In an exceptional deal for a director to make his feature helming debut, Ghost House Pictures has made a seven-figure deal with a Uruguayan commercials director to direct his pitch for an alien invasion film.

How did Fede Alvarez score such a million dollar deal when most first-time helmers make $250,000? The heat is based on “Ataque de Panico!” (Panic Attack), a four minute 48 second short film about an apocalyptic robot attack that Alvarez directed through his  commercial production house at a cost between $300-$500. Watch for yourself: http://vodpod.com/watch/2461813-ataque-de-pnico-panic-attack-2009

After the short found its way to the internet and Kanye West featured a link to the film on his blog, a 30-year old who was not on anyone’s radar outside the Uruguayan blurb market suddenly found the biggest agencies in Hollywood in a collective panic attack to sign him. That created a chain reaction of activity over two weeks that led to a trip to Hollywood, where he met with every major agency, management firm and law firm that responded to the short--and a big deal. 

After he signed with CAA, Anonymous Content and attorney Karl Austen, Alvarez made a pre-emptive deal with Ghost House that sets the helmer up to make his first film under the guidance of one of his directing heroes, Sam Raimi, who formed the genre label Ghost House within Mandate Pictures with Rob Tapert, Nathan Kahane and Joe Drake.

Raimi sparked to Alvarez’s short film—which offers a stylized vision of apocalyptic destruction that appears to have been made for far more than Alvarez spent. After Alvarez pitched an original idea for an alien invasion idea to the “Spider-Man 4” director, Ghost House  closed a deal with Alvarez’s new reps that guarantees him a six-figure holding deal to wait while Ghost House hires a high-end scribe to turn the idea into a feature. The six-figure deal will be applied against a seven-figure fee if Ghost House
makes the film.

Raimi will produce with Ghost House partner Tapert, with Vertigo’s Roy Lee and Doug Davison also be involved in producing capacities. Kahane will be exec producer.

The idea that an unknown could put himself on the map by placing his film on the internet shows how much the Hollywood landscape is changing and how hungry financiers and studios are to find a filmmaker who might deliver the next “Paranormal Activity,” “District 9” or “Twilight.” 

While the Thanksgiving weekend showed that stars can still perform—Sandra Bullock has carried the $30 million “The Blind Side” to a $100 million gross in just over one week—Alvarez’s short conjured up a high concept, visually-intriguing film that can be made for a small budget with no gross players by a filmmaker who can plug into a youthful demographic.

The Ghost House deal gives Alvarez the opportunity to make his Hollywood debut that is godfathered by Raimi in a mentoring role similar to the one that Peter Jackson served in Neill Blomkamp’s directing debut on “District 9,” an under $30 million film which has grossed over $180 million worldwide.

Paramount Pictures has landed U.S. distribution rights to “Area 51,” the Oren Peli-directed follow-up to the sleeper hit “Paranormal Activity.”

Deal puts the studio back in business with the creative and financing team behind “Paranormal Activity,” the $11,000 budget film which has grossed more than $106 million since Paramount began rolling it out in September.

Peli had a much larger budget to work with on this extraterrestrial tale than he did for his ghost story, as sources said he brought the film in at a shade under $5 million.

Paramount made a high-seven figure commitment, said sources to become co-financier with Incentive Filmed Entertainment and the Aramid Entertainment Fund. The trio will be co-financing partners going forward on any sequels.

As many as four other bidders wanted the picture, but Paramount Film Group president Adam Goodman had an inside track. He was instrumental in acquiring “Paranormal Activity” while at DreamWorks, and was the hands-on exec at Paramount, which did a superb job at slowly rolling out the film as the picture built word of mouth and became a breakout hit.

Goodman closed the deal with David Molner, chairman of Incentive Filmed Entertainment, Stuart Ford, CEO of IM Global, and CAA.

Just as they did on “Paranormal Activity,” Peli wrote and directed “Area 51” and Jason Blum is producing through his Blumhouse Productions banner. Room 101’s Steven Schneider, IM Global’s Ford and Amir Zbeda are executive producers.

Pic, which completed principal photography three weeks ago, was fully financed by Incentive and the Aramid Entertainment Fund. Latter is a co-financing partner of Paramount’s slate on films that include the “Transformers” films.

The film employs the “found footage” narrative structure that Peli used in “Paranormal Activity” to tell the story of three teens whose curiosity leads them to the notorious Area 51 portion of Nellis Air Force Base in the Nevada desert.

Fueled by the strong grosses of “Paranormal Activity,” “Area 51” was one of the brisk sellers at the American Film Market. It has sold internationally almost everywhere except Japan and certain Eastern European markets where talks are ongoing. Key buyers include Momentum in the U.K., Concorde in Germany, Equilatero/Warners in Spain, Village Roadshow in Australia, Alliance in Canada, Playarte in Brazil, Gussi in Latin America, RCV in Benelux and Svensk in Scandinavia.

Studio and financiers confirmed the deal and said they were pleased to be teaming once again on a film that hasn’t yet set a release date but will surely find its way to theaters some time in 2010.

“Moviegoers everywhere demanded to see Oren Peli’s spectacular debut and we are excited to show them what he’s created next,” said Par’s Goodman.

Peli and Blum said they were “Happy to continue working with with agile and talented production, marketing and distribution teams at Paramount that made `Paranormal Activity’ such a remarkable success.”

Molner said the deal illustrated the fertile ground in creating moderately budgeted franchises that have become some of Hollywood’s biggest hits.

“These films show that real franchises can be successfully launched from the independent side of the business, not something the marketplace necessarily believed five years ago,” he said. “As financiers, we’re very lucky to create value in ownership with major distributors like Paramount Pictures and the enviable talents of Jason, Oren, and IM Global.”

Said IM Global’s Ford: “With the international distribution already set up on the film, bringing Paramount onboard after they did such distinguished work on `Paranormal Activity’ is the perfect finale, and most important piece in the jigsaw.”

As Peli and Blum go into postproduction on “Area 51,” the next deal to be made will be for another installment of “Paranormal Activity,” which will once again be done through Paramount.

In what has to constitute the shortest retirement in Hollywood history, “New Moon” director Chris Weitz told BFD at a Gotham screening that he has no plans to hang it up at age 40. In fact, Weitz says he never intended to retire in the first place.

Thursday’s New York Post’s Page Six column cited a Moviemaker Magazine interview to report that Weitz was leaving the business after making one more film. He seemed to have rallied since doing that interview. Indeed, he had a vigor comparable to Minnesota Vikings QB Brett Favre, who has made temporary retirement as much a part of his playbook as the forward pass. 

Weitz said he will start production in March or April on “The Gardener,” but was contemplating a future beyond that. His prospects will surely brighten after the expected monstrous opening weekend for “New Moon.”  

Scripted by Argentinian writer/director Eric Eason, “The Gardener” reunites Weitz with “Twilight”-maker Summit Entertainment. Deals with Weitz and Eason are being negotiated.

“There are no werewolves or vampires, just a Mexican gardener in Los Angeles,” Weitz said at the cast screening held at the Landmark Sunshine Cinema.

Unlike his last book-based film “The Golden Compass,” Weitz said he was energized by the experience of making “New Moon” because Summit and “Twilight” series author Stephenie Meyer trusted him to honor the books that created a ferocious fan base, while adding his own stylistic imprint. He expected the same on “Golden Compass,” and was crushed when heavy-handed editing by New Line eliminated 30 minutes of footage and neutered any of the edge evident in the Phillip Pullman books

“It was an utter violation of my status as a director, and the worst thing that has happened to me professionally,” Weitz said.

The filmmaker said loyalty to the “Golden Compass” cast and crew kept him from speaking out when the film was released.

Said Weitz: “I practically bit through my tongue, but I would be very happy to see `New Moon’ surpass `The Golden Compass.’ Now, that dish is cold, and I’m ready to eat. I was treated badly, it was almost like they never read the books. They seemed frightened of offending the Right. This was a wonderful experience by comparison. I got to work with terrific young actors at the top of their game, and see Taylor Lautner perform so well.”

While Moviemaker quoted Weitz as focusing on surfing and learning Spanish and kung fu, those apparently will remain hobbies. Depth of Field, the company he runs with brother Paul, has a potential Oscar entry in the Tom Ford-directed “A Single Man,” and Paul is off directing “Little Fockers.”

Weitz said he’s learning to be careful about swearing off movies when he’s drained from finishing one, because it’s like a fully dilated pregnant woman swearing off reproduction.

Weitz and Favre aren’t the only ones who haven’t stuck to retirement proclamations.  In 2002, an Entertainment Weekly cover trumpeted the exclusive that Stephen King would soon stop writing books. Subsequently, he has killed more trees than a lumberjack, cranking out fat thrillers. And King had enough words left over to become a columnist for that magazine.

He plays majestic screen figures like God ("Bruce Almighty") and Nelson Mandela (the upcoming Clint Eastwood-directed "Invictus"). Can Morgan Freeman's backing help launch a company trying to infiltrate the digital DVD download business? 

Freeman and Revelations Entertainment partner Lori McCreary have thrown their financial resources and technical expertise behind Digiboo LLC, a new venture that will allow consumers to rent films by plugging in a small, portable USB 3.0 flash drive into kiosks that will be set up at retail outlets beginning in January.

Run by CEO Richard Cohen--former MGM Home Entertainment and Consumer Products president--the L.A.-based Digiboo launches a pilot program in January with Oregon-based Movie Gallery Inc. that will see 100 digital movie kiosks operate in Hollywood Video and Movie Gallery retail stores, with plans to expand into airports, coffeehouses and college campuses.

While Revelations partners Freeman and McCreary are best known for feature film pursuits--she and Revelations are producers of “Invictus"--they have long experimented in hi-tech ventures.

Samuel Edge, the CEO of Digital Revelations, will become Digiboo’s Chief Technology Officer and will be involved day to day in the new venture. Revelations’ last tech venture was the digital movie-store ClickStar, a joint venture between chipmaker Intel and Relevations that launched at a time when consumers might not have been ready for digital downloading.

McCreary and Edge said things are changing. Downloads are speedy and easily played on home entertainment devices. Their involvement in the venture came from continuing dialogue with Intel.

“We were invited by Intel a year ago to help put together a technical strategy to distribute digitally, using USB as the medium,” Edge said. “USB 3.0 is remarkable for its portability, and the ability to walk to a kiosk, and walk away in eight to 15 seconds with a movie in your pocket.”

Digiboo joins Blockbuster on the battleground of this fledgling film rental technology, which eliminates DVDs in favor of downloads that can be played on computers, mobile phones, netbooks, televisions and other home devices.

While Blockbuster reportedly will launch its program using SD cards, Digiboo chose USB 3.0 technology, which the company says are already compatible to computers and can be adapted to other devices with an installed base device. An 8 GB unit holds up to four movies, with rental periods expiring at the end of 3-day windows, and copyright protected by digital rights management technology.

It is inevitable to compare any new video venture to Redbox and its $1.09 per day DVDs that have shaken up Hollywood. 

Digiboo won’t beat that price—Cohen said that price point will vary during the pilot program, but will likely be comparable to the $3.50 to $5.50 that Hollywood Video and Movie Gallery charges for rentals. But Digiboo kiosks will offer more than 1000 movies and TV shows for rental and sale, he said, and the download system eliminates the need for a trip to return a DVD.

“We don’t have any fantasy of knocking Redbox out of the box, because DVDs will remain a successful business for a good long time,” Cohen told Daily Variety. “The marketplace is very big, and there’s room for Redbox, Netflix, Blockbuster, Hollywood Video, and us. Each serves a portion of a market that sometimes overlaps. For people who want a $1 a day rental, we’re not the better alternative, but we believe we offer sufficient benefits, including portability, to achieve a meaningful marketshare. Newer televisions are being built with USB ports, and we’re working with a manufacturer on a relatively inexpensive unit that will adapt other televisions. The netbooks that have become so popular won’t ever be able to play DVDs, but they are equipped to handle USB.”  

Aside from his MGM stint, Cohen was CEO of DVD kiosk company TNR Entertainment and also former exec veep in home video for Disney. He formed the company last year with Jeff Karbowiak, Blake Thomas and Eric Villette, who were also senior MGM Home Entertainment executives. Funding, he said, comes from a variety of investors in the U.S. and Europe, and he said that Revelations has become its most prominent investor, with McCreary joining the Digiboo board and Edge playing a key day to day role in the company.

He declined to say if Freeman will use his iconic industry status to help win studios over into supplying their titles to the new venture.

“They bring enormous credibility and intelligence to the company and validate the approach,” said Cohen, who said he’s in ongoing negotiations with studios to supply product, but was confident that the kiosks would be well represented with a wide selection.