It's not really surprising. The Tolkien Estate has always been aggressive (overly so in some instances, in my humble opinion) protecting its intellectual property, but I understand it's Hollywood Lawyers in this instance.
Still, I can't help but think the pub owners should have known better. Images that clearly look like the actors from the movies and "The Hobbit" emblazoned on the banner/shingle? C'mon... they knew they were pushing the envelope. They were just hoping to stay under the radar.
Call it the
Prancing Pony, lose the character images—but keep the overall decor—and you're golden. It could be too late for that, though... that's frankly where they should have started. We wouldn't be here discussing it if they had. Popularity/business from all the attention (not to mention the "Save the Hobbit" campaign) will probably console them as they struggle to comply with the oppressive legal requirements, though.