The Kingdom of Lovely is a micronation established in 2005 by one Mr. Danny Wallace-- a British comedian, film maker, and radio and television presenter.
Back in 2005, as a part of his six part BBC comedy-documentary, How to Start Your Own Country, Wallace decided he wanted to start his own nation. He thought the best way to go about this was to "invade" the Eel Pie Island in the river Thames, with his friend Jon Bond, the Kingdom of Lovely's Minister of Defense (because Bond was a security guard at a Tesco once, and that's sort of like being an army). Shortly after his arrival, Wallace and Bond were asked politely to leave by the police department after some locals called to complain, and Wallace was forced to return the rights to the island back to the Queen.
After the Eel Island incident, Wallace decided to eschew traditional British methods of acquiring land and decided to base the whole thing online, with his apartment in East London being the official territory. He tried to get it recognized by the UN, but was ultimately turned away for the lack of actual, you know. Land.
The national motto is "Die dulci freure" The national currency is the Interdependent Occupational Unit-- the "IOU" which isn't worth money so much as it is worth time. It's moot now as, since Wallace has more or less abandoned the project, there's no way to use the IOUs. At its height, the nation had 58,165 members, but that number is no doubt off now since the BBC boards were closed down in 2007.
I haven't seen the documentary, but from what I gather, it has the process of The Kingdom of Lovely's creation interspersed with interviews of people with a vested interest in the micronation business.