James Cameron's forthcoming Avatar has been trumpeted as the future of cinema, pointing the way to a brave new world of 3D computer-generated film production. But could it be that this future has already come and gone - flopping at the box office back in 2008?

The makers of the little-seen animated fantasy Delgo certainly think so and are considering legal action against Avatar's backers 20th-century Fox. "From what we have seen, we are amazed by the visual similarities between the two films," Atlanta-based Fathom Studios said in a statement. "We are considering what legal options may be available to us."

Reportedly the first independent CGI animated feature to be made in America, Delgo starred Freddie Prinze Jr and Jennifer Love Hewitt as two love-struck aliens who help save their respective planets from an intergalactic tyrant voiced by Anne Bancroft. Budgeted at an estimated $40m (£24m), the film bowed out with just $700,000 from US cinemas, making it the year's biggest box office failure.

Avatar director Cameron has claimed that his film has been in the planning stages since the late 90s, although production did not officially begin until 2006. However, the creators of Delgo reportedly posted "proof-of-concept" imagery on their dedicated website, delgo.com, as far back as 1998.

Following last week's screening of 15-minutes of Avatar footage, parallels between the two films were noted by pundits on USA Today, NY magazine and the Huffington Post. According to online movie critic JoBlo, the similarities between Delgo and Avatar are "pretty damn conclusive and practically warrant a likeness lawsuit from the lowest-grossing movie ever to be filed against the director of the highest-grossing movie ever".

Avatar goes on general release from 18 December 2009.