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Vikings: Valhalla, the newly-announced Vikings sequel series from Netflix, may already be hitting some snags in production due to a legal issue raised by a German film company. Deadline reports that lawyers for the Berlin-based W2 Filmproduction said last week that W2 may seek an injunction as part of its ongoing action against Vikings producers Morgan O'Sullivan and James Flynn of Octagon Films, which is also a producer on the spinoff series.

W2 alleged that the producers diverted around €40 million out of Octagon, of which they are shareholders. The case, which began in 2016, returned to court last Thursday, with O'Sullivan and Flynn denying W2's allegations.

Lawyers for W2 told the court the company had only learned about the Vikings spinoff through the media, and that the fees generated from the original Vikings series remain a central issue in the legal action. The company fears funds generated by Vikings: Valhalla, which the German firm says should go to Octagon, will be diverted to the defendants instead.

Friday, O'Sullivan and Flynn's lawyers said they did not accept W2's suggestion that the spinoff series breached undertakings previously given to the court and asked the judge for a 12-month extension in order to comply with a court order to produce documents relating to dozens of film and TV productions. However, the judge advised that a substantial volume of documents must be supplied by Jan. 17, and that the case will reconvene in court on Jan. 31.

W2 is a 49 percent shareholder in Octagon, which is among the most successful production companies in Ireland, boasting credits like Vikings, The Tudors, Love/Hate, Penny Dreadful and The Borgias. Flynn's work includes Neil Jordan's Greta and John Michael McDonagh's Calvary. O'Sullivan was a producer on films such as Leap Year, P.S. I Love You and Becoming Jane.

The Vikings sequel series was revealed last week with O'Sullivan, MGM TV, series creator Michael Hirst and showrunner Jeb Stuart all noted as being on board. The show is set to film in Ireland, where the original series was also shot.