Why Tim Burton's Batman 3 Never Happened:
Tim Burton’s Batman 3 never happened because of the reaction to Batman Returns, which was swift and brutal throughout the press.
The screenwriter of Batman Returns, Daniel Waters said he was aware of the potential backlash immediately. As a subversive voice who made his bones on the cult classic dark comedy about teen murder and suicide, Heathers, Waters was one of the driving forces that turned the sequel into a near fable about the sameness of freaks, be they cats or bats. And when recalling the first time he saw the movie with an average audience (for the 2005 documentary Shadow of the Bat – Part 4: Dark Side of the Knight), Waters said, “It’s great. The lights are coming up after Batman Returns, and it’s like kids crying, people acting like they’ve been punched in the stomach, and like they’ve been mugged. Part of me relished that reaction, and part of me to this day is like, ‘Oops.’”
For the same documentary, director Burton also seemed bemused and baffled by the mixed reactions 13 years later. Says Burton, “One person would come in and go, ‘This is so much lighter than the first movie.’ And then the next person would come in and go, ‘Oh, this is so much darker than the first movie.’ And it’s like, light and dark are opposites! But it was 50 percent passionately one way and 50 percent the other.”
Many more details surrounding the demise here:
http://www.denofgeek.com/us/movies/batman/239632/why-tim-burtons-batman-3-never-happened