Excellent, thank you!
What about FL making up new stuff (for, say, a fourth age campaign), as opposed to using names and concepts from other Tolkien writings?
Ought not to be a problem.
The limitation is that the licensee is not allowed to use
any material created by Tolkien from any source other than Hobbit or LotR.
The licensee is
not obligated to stick
only to material created by Tolkien (as we could see, to our detriment, in the Peter Jackson movies).
There should thus be no provision that would forbid Ligan to embellish, embroider, or expand the premise to their hearts' content with material of their own invention.
But, as we all know: with great power comes great responsibility. We hope Ligan uses it wisely; here, and elsewhere...