Topline
Board members of the special district that oversees Walt Disney World, appointed by Florida Gov. Ron DeSantis (R), sued Disney in state court Monday—less than a week after Disney sued DeSantis and the board—the latest twist in a year-long war between the media giant and Florida Republicans that erupted over the state law known as “Don’t Say Gay.”
Cinderella Castle at Walt Disney World’s Magic Kingdom Park on April 3, 2022, in Orlando, Florida.
Timeline
The Florida legislature passes HB 1557, the Parental Rights in Education bill known by critics as “Don’t Say Gay,” which restricts classroom instruction on sexual orientation and gender identity through the third grade and became a subject of national controversy, as opponents decried it as anti-LGBTQ.
Following pressure from its employees over its silence on the bill, Disney publicly condemns HB 1557 the day DeSantis signs it into law, saying in a statement the law “should never” have been enacted and its “goal as a company is for this law to be repealed by the legislature or struck down in the courts.”
DeSantis blasts Disney for opposing HB 1557, saying the company “crossed the line” and his administration was “going to make sure we’re fighting back when people are threatening our parents and threatening our kids.”
Florida State Rep. Spencer Roach (R) tweets that Florida Republicans have started meeting about repealing the 1967 Reedy Creek Improvement Act, which established the Reedy Creek Improvement District, the special district that oversees Walt Disney World and functions in the same way as a county government, handling local infrastructure services.
The Florida legislature passes legislation that dissolves Reedy Creek and other special districts established before 1968 as part of a special session the governor amended to include the Disney feud, with the law set to take effect on June 1, 2023.
Local officials raise concerns about getting rid of Reedy Creek without a plan to replace it, saying abolishing the tax district could be “catastrophic” for local taxpayers by shifting the district’s debt to local governments, and Fitch Ratings warns that Reedy Creek’s debt rating could be downgraded over the concerns.
Undaunted, DeSantis signs the bill into law.
Former Disney CEO Bob Iger reassumes control of the company, replacing outgoing CEO Bob Chapek in a surprise move.
After months of silence on the details of Reedy Creek’s dissolution, the Financial Times reports lawmakers are considering backtracking on the plan to punish Disney and seeking a “compromise” with the company instead, citing Iger’s return to power as a reason to make amends with the company—but DeSantis’ office immediately denies the report, saying the governor “does not make ‘U-turns.’”
Florida lawmakers call a special session in part to address how the government will handle Reedy Creek.
Disney and the Reedy Creek board—made up of members largely elected by Disney—finish executing a development agreement and restrictive covenants that give Disney broad power over development on its land and give the company approval rights over the exteriors of any buildings on its property, even if they’re not Disney-owned.
DeSantis signs legislation that overhauls the special district and renames it to the Central Florida Tourism Oversight Board, and names five appointees—including DeSantis donors and conservative activists—to its board, replacing the previous board elected by the district’s landowners.
The DeSantis-appointed board announces its discovery of the development agreement Disney signed in February and expresses its outrage, with chair Martin Garcia saying the agreement “essentially makes Disney the government” and means the board loses “the majority of its ability to do anything beyond maintain the roads and maintain basic infrastructure,” while Disney maintains in a statement that the agreement was done in accordance with Florida law.
Hours after DeSantis called for a state investigation into the development agreement and the special district’s previous board, Iger hits back at DeSantis during a shareholder meeting, saying, “A company has a right to freedom of speech just like individuals do,” and criticizing the government’s war on Disney as “anti-business” and “anti-Florida.”
DeSantis announces additional measures the state intends to take against Disney at a press conference, including legislation to nullify the development agreement and subjecting Disney’s rides and monorail to state safety inspections—rather than let Disney use its own inspectors—and the governor floats actions the board could take, including building a state prison on land in the district that Disney doesn’t own.
The special district board meets and vows that “nothing is off the table” in terms of its retaliation against Disney, listing a wide range of potential steps the district might take including greater government regulation over things like swimming pool inspections and alcohol licenses; raising Disney’s utility prices and joining lawsuits against Walt Disney World protesting how it’s taxed.
The board unanimously votes to declare the development agreement “void and unenforceable,” prompting Disney to sue DeSantis and the board members in federal court minutes later; the Florida Senate then passed legislation that evening that would also nullify the agreement, despite Disney’s litigation.
The special district board countersues Disney in state court, asking for the court to void the development agreement and restrictive covenants.
Crucial Quote
“In an effort to stymie Florida’s elected representatives, Disney covertly cobbled together a series of eleventh-hour deals with its soon-to-be-replaced puppet government,” the board’s lawsuit alleges. “Perhaps out of haste or arrogance, Disney’s deals violate basic principles of Florida constitutional, statutory, and common law. As a result, they are null and void—not even worth the paper they were printed on.”
Chief Critic
Disney has not yet responded to a request for comment on the board’s countersuit, but the company’s lawsuit filed last week defends the development agreement and restrictive covenants as lawfully enacted and argues DeSantis and the board’s attacks on the company are an infringement on the company’s First Amendment rights. “Disney regrets that it has come to this,” the company said in its lawsuit. “But having exhausted efforts to seek a resolution, the Company is left with no choice but to file this lawsuit to protect its cast members, guests and local development partners from a relentless campaign to weaponize government power against Disney in retaliation for expressing a political viewpoint unpopular with certain State officials.”
What To Watch For
The DeSantis board lawsuit asks the state court to declare the agreement and covenants null and void and issue an order that enjoins Disney from enforcing them. Disney’s lawsuit asks the court to essentially restore the special district to how it was before DeSantis’ attacks began, except with the development agreement now in place. The litigation asks for the laws that overhauled the special district in the first place to be overturned, as well as the board’s vote Wednesday to nullify the special agreement. Disney’s case, filed in federal court, has been assigned to U.S. District Judge Mark Walker, an Obama appointee who has been willing to strike down DeSantis’ policies in the past, though the case could be appealed all the way to the Supreme Court.
Surprising Fact
DeSantis’ board has said the legal battle over the development agreement will have a negative impact on companies in the special district—including small business owners who independently operate restaurants, stores and other businesses on Walt Disney World’s land. Board chair Martin Garcia told small business owners at its meeting Wednesday that the “legal mess” over the agreements had forced the board to hire lawyers, and “we’re going to have to raise taxes to pay for that.” Garcia’s comments were made before Disney’s lawsuit and the board’s countersuit were filed, presumably further raising the district’s legal fees.
Tangent
DeSantis’ recent attacks on Disney have ramped up as the Florida governor is widely expected to soon launch his 2024 presidential campaign. His Republican rivals have been critical of DeSantis’ war on Disney, with former President Donald Trump saying the governor’s feud with the company is “all so unnecessary, a political STUNT!” and potential GOP candidate Chris Christie telling Semafor the episode makes him question if DeSantis is really a conservative and saying it “rightfully makes a lot of people question [DeSantis’] judgment and his maturity.” A Reuters/Ipsos poll released Wednesday found the feud could win DeSantis some votes in a GOP primary, however, finding that 54% of GOP respondents had a more favorable view of the governor based on his fight with Disney. The poll found a 73% majority of the general electorate were less likely to support candidates “who [back] laws designed to punish a company for its political or cultural stances,” however, suggesting it wouldn’t bolster him in a general election.
Key Background
The Reedy Creek Improvement District has been in place since even before Walt Disney World opened in 1971, functioning like a local government and overseeing such functions as roads, waste collection, construction permits, emergency services and utilities for Disney’s property. The special district is formally separate from Disney, but prior to DeSantis’ takeover the company was able to exert a significant level of influence as its major landowner. Landowners’ votes for board members was based on the acreage of land they own in the district, and other residents in the special district with voting powers were handpicked by Disney to reside there. Disney’s opposition to HB 1557 and subsequent refusal to give in to the government’s attacks on it for opposing the law comes as the company has in recent years pushed for more diversity in its theme parks and entertainment content, with more recent films including LGBTQ themes and the company updating rides in its theme parks to get rid of racial stereotypes. Disney drew widespread attention online when its main company Twitter account shared information about its upcoming Pride Night at Disneyland, the company’s first, immediately following DeSantis’ April 17 press conference ramping up the state’s attacks on the company.
Further Reading
Disney Sues DeSantis After Board Votes To Get Rid Of Special Agreement (Forbes)
DeSantis Ramps Up Disney Feud With New Measures Against Theme Park (Forbes)
DeSantis Disney Board Meeting: Here’s How Governor And His Appointees Could Change Disney World (Forbes)
Source: https://www.forbes.com/sites/alisondurkee/2023/05/02/desantis-board-countersues-disney-heres-a-time-line-of-floridas-war-with-the-mouse-over-special-district/