EXCLUSIVE: The Weinstein Company has set a May production start in Asia on a sequel to Crouching Tiger, Hidden Dragon. There is a script by John Fusco, and TWC is in talks with veteran Chinese director Ronny Yu. Harvey Weinstein is producing.

The new film is derived from the same source material as the Ang Lee-directed 2000 film that won the Oscar for Best Foreign Language Film and three other Academy Awards. Lee isn’t involved in this one, which is based on Silver Vase, Iron Knight. That is the fifth book in the Crane-Iron Pentalogy by Wang Du Lu. Crouching Tiger was the fourth book in the series. Fusco, whose credits include Spirit, Hidalgo and The Forbidden Kingdom, is an avid follower of Wu Sia, the centuries-old genre of Chinese fiction that this series is part of.

“This was an opportunity to explore a lifelong passion I’ve had for Wu Sia, and if there wasn’t continuing source material, I would never have gotten involved,” Fusco told me.

The sequel continues to revolve around Yu Shu Lien, the character played in the original by Michelle Yeoh. It’s not immediately clear yet which actors will reprise, but some likely will. “This introduces a new generation of star-crossed lovers, and a new series of antagonists in a battle of good and evil. It has a Knights Errant quality. There is an alternate universe in the books, a martial forest that exists alongside the real world, full of wandering sword fighters, medicine men, defrocked priests, poets, sorcerers and Shaolin renegades. It’s so vast and rich, and I found characters from the second and third books in the series to create a most interesting stew while being as true to the source material as I could be.”

TWC and Sony had battled several years ago over the rights to the books left behind by the author, who died in 1977. Reports quoted his son, Hong Wang, saying his family made very little money from the original film, and that they went out to make another deal. TWC feels it walked away with those theatrical rights and is going ahead with its film, which has a budget north of $20 million.

Casting will get underway after the director signs, and for his part Fusco expects a return from Wo Ping Yuen, the legendary fight choreographer responsible from the high wire action work in the original. They worked together on Forbidden Kingdom (pictured). Fusco separately scripted Marco Polo for Electus/Weinstein Co and Starz, as well as the feature Highwaymen, which has John Lee Hancock attached to direct a retelling of the Bonnie & Clyde story from the vantage point of Texas Ranger Frank Hamer, who was called out of retirement to head the manhunt. Liam Neeson is eyeing that role. He also adapted the rise of Elvis Presley pic Last Train To Memphis for Fox 2000 and Steve Bing, based on the Peter Guralnick novel. Fusco’s repped by UTA.