Pick Your Side: Disney v. DeSantis
Florida Governor Ron DeSantis’s fight with entertainment giant Walt Disney Co. is almost hard to watch. The latest salvo was launched this week by the governor’s side, which filed a lawsuit against Disney in an attempt to invalidate two long-term contracts that give Disney substantial control over the district it is in. And that’s just this week.
Maybe a legal battle isn’t the most hospitable way to treat one of your state’s largest employers and taxpayers, but it seems that for DeSantis, there’s a principle at stake.
Let’s start at the top.
The Parental Rights in Education Bill
The fight started over Florida’s Parental Rights in Education Act (originating as House Bill 1557), which prohibits educating children in 3rd grade and lower about sexual orientation and gender identity. Styled by the media as the “Don’t Say Gay” bill, protests against the legislation came from all corners of the country, including major media organizations and large corporations.
Disney chose to offer an opinion on the legislation. It issued the following press release:
To ALL who come to this happy place, welcome. Disney Parks, Experiences and Products is committed to creating experiences that support family values for every family, and will not stand for discrimination in any form. We oppose any legislation that infringes on basic human rights, and stand in solidarity and support our LGBTQIA+ Cast, Crew, and Imagineers and fans who make their voices heard today and every day.
On March 28, 2022, Governor DeSantis signed the bill into law. Disney responded by announcing that the goal for the company was to have the legislation repealed or struck down by the courts, and that it would support state and national organizations that shared that goal.
Round One: DeSantis’s First Punch
That was too much for Governor DeSantis. The next day, he said that he thought Disney’s statement “crossed the line” and promised to “make sure we are fighting back.” And a Republican state representative soon announced that “if Disney wants to embrace woke ideology,” the legislature would strip it of its self-governance.
In 1966, Florida passed a law that created a special improvement district in roughly 43 square miles in Central Florida, the Reedy Creek Improvement District (RCID). The state granted the RCID the authority to develop itself and provide utilities and other services to those within its boundaries. Disney, the largest landowner in the RCID, built theme parks (including Walt Disney World) within the district and had administrated the district through an elected board of governors since its founding.
In February 2023, the Florida legislature convened a special session at the governor’s behest to create a successor agency to the RCID’s board of governors. While reenacting the RCID’s charter, Florida passed legislation creating the Central Florida Tourism Oversight District (CFTOD), which would be administrated by a board appointed by the governor subject to confirmation by the Florida Senate.
Round Two: Disney Counter-punches
Meanwhile, Disney wasn’t just waiting for the boom to drop. As early as January of this year, the RCID’s board saw where the Florida legislature was headed. The board published notice of its intent to enter into two agreements with Disney. One was a long-term land development agreement; the other, a declaration of covenants that would place restrictions on how the property within the district could be used. The terms of each of these agreements are very favorable to Disney.
Over the next two weeks, the RCID’s board held two publicized hearings on the agreements. On February 8, the board approved them. That same day, the RCID and Disney signed the agreements and recorded them in official county records.
Round Three: DeSantis Strikes Back
DeSantis’s hand-picked CFTOD board sat for its first meeting a month later, on March 8. They discussed various options regarding the district, but somehow overlooked the two February agreements.
But not for long. At its second meeting on March 29, the CFTOD board announced that Disney had pulled a fast one on the state. At its April 19 and April 26 meetings, the CFTOD board announced and unanimously passed a resolution accompanied by legislative findings declaring that the two agreements were void and unenforceable.
Meanwhile, the governor and the legislature ratcheted up the rhetoric. Throughout April, Governor DeSantis promised that Disney would get its comeuppance. He initiated both civil and criminal investigations of Disney. He even suggested that the state might use the land taken from Disney’s control to build a state prison, among other things. For good measure, the legislature advanced a bill that would prohibit enforcement of the February agreements unless ratified by the CFTOD board, something it declared it was unwilling to do.
Round Four: Disney v. DeSantis
Disney had finally had enough. Getting attacked on all sides by a hostile government and at risk of losing billions in investments, Disney filed a lawsuit in federal district court against the governor, the CFTOD board, and other state officials involved in the campaign against it. In its complaint, Disney contends that Florida engaged in a targeted campaign of government retaliation that violated its constitutional rights, and that the February agreements are valid and enforceable.
Round Five: DeSantis v. Disney
Not to be outdone, the CFTOD filed its own lawsuit in Florida state court against Disney, seeking to invalidate the February agreements. The board contends that the agreements were the result of a secret, backroom deal that seeks to circumvent the express will of the people of Florida.
Who Wins?
Disney is our bet — in both cases.
In Disney v. DeSantis, Disney raises a number of persuasive constitutional arguments, but the most compelling is that the government violated its First Amendment rights. Disney spoke out against the Parental Rights in Education bill, which it has every right to do, and the government punished Disney for doing so. For the government, retaliating against someone for asserting their First Amendment rights is a constitutional no-no.
In DeSantis v. Disney, the government faces the uphill battle of trying to convince a judge that contracts that were duly noticed, executed, and recorded should be ignored if the political winds change. Besides, if a contract could be invalidated on the grounds that it was negotiated by interested parties in secret, very few government contracts would survive.
What’s Next?
With both parties seemingly dug in, we expect that both Disney and the state will pay tons of money to pricey lawyers while they duke out their multiple court battles. Florida could save a lot of money, both in the short and long term, if it would tone down the rhetoric, eat a little crow, and let its largest taxpayer get back to doing what it does best: making people happy.
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