“Swift and Severe” Harm Hit Disney Following “Don’t Say Gay” Debacle, According to Investor Lawsuit

Disney has been the subject of a few lawsuits lately, and now another has hit the Company.

Disney Pride Decoration

We’ve already seen a lawsuit filed regarding Magic Key Passes and the Park Pass system in California, Annual Passes and the Park Pass system in Florida, and the Genie/Genie+ system. Now, another lawsuit has hit the Mouse, and it comes from an investor.

According to Bloomberg, Kenneth Simeone, an investor in Disney, filed a lawsuit in Delaware Chancery Court against Disney (Kenneth Simeone v. The Walt Disney Co., No. 2022-1120, Delaware Chancery Court (Wilmington)). Let’s go through the basics:

What Is the Lawsuit About?

The lawsuit is centered around Disney’s response to Florida’s Parental Rights in Education Bill (what critics called “Don’t Say Gay”). As a quick recap, Disney initially refused to make a statement on the bill. Later, Chapek apologized for not being a “stronger ally in the fight for equal rights,” and made it clear that Disney was opposed to the bill. Disney ultimately made a stronger statement as the bill was passed, indicating that it should not have been passed and that Disney would work toward its repeal.

This prompted Florida Governor Ron DeSantis to indicate that Disney had crossed a line. Following this, as a form of retaliation, the Florida legislature and Governor DeSantis passed/signed a bill into law that will dissolve Disney’s Reedy Creek Improvement District (RCID) in 2023. The RCID has essentially allowed Disney to function as its own county government for 50+ years, giving it a great deal of control over the land on which it operates in Florida.

Disney Family Pride

There has been some talk about a new district that could replace the RCID and how it would essentially function much like the RCID but potentially give the Governor some “wins,” like the ability to nominate some individuals for the new district’s Board. No final decision or arrangement has been announced yet.

That brings us to the current day and the lawsuit brought in response to Disney’s actions in handling this “Don’t Say Gay” situation.

What Does the Lawsuit Allege?

According to Bloomberg, the lawsuit claims that Disney created “‘far-reaching’ financial risks for itself by opposing a Florida law limiting instruction on sexual orientation or gender identity in elementary schools.” Simeone claims that by criticizing “Don’t Say Gay” Disney “lost control over tax and improvement issues at its Orlando-area theme park.”

Simeone has demanded that Disney turn over internal records about the decisions made surrounding the Company’s opposition to “Don’t Say Gay.”

Pride in Animal Kingdom 2022

The lawsuit alleges that the “financial repercussions from Disney’s actions, and resulting harm to the company and its stockholders, have been swift and severe.”

The investor claims that there are “legitimate questions” about the decision by Disney’s Board of Directors to let executives within Disney publically oppose the bill (now law), knowing that Disney could “lose the benefits of a one-of-a-kind deal that has existed between Disney and the state for more than half a century.”

©Spectrum News 13

It wasn’t until after Disney’s statement against “Don’t Say Gay” as the bill was passed into law that it was revealed that Florida legislators had met to discuss a repeal of the RCID. But Simeone alleges that Disney “ignored a warning from the governor about opposing the statute.”

The bill to dissolve the RCID was introduced and then swiftly passed. Though the law would greatly impact Disney, it could also impact Florida and the counties that surround Disney. Some have warned that the dissolution of the RCID could result in a huge tax burden (particularly a burden surrounding outstanding bonds) being passed on to local counties.

Florida Democratic state senator Linda Stewart has explained that she didn’t “think [DeSantis] understood how badly this could go for the state of Florida and the counties and the cities.”

What Is This Lawsuit Really?

According to Bloomberg, this is what is known as a “books and records” action. Basically, it’s a way of demanding documents that could then later be used to sue Disney’s directors over their handling of the “Don’t Say Gay” situation.

Bloomberg points out that Delaware judges “often grant such file requests.” Now that the request for documents has been made/lawsuit filed, we’ll have to wait and see how the case is decided and whether the documents are provided. That could lead to further legal action against Disney’s Board of Directors.

Pride Wall

For more updates about Reedy Creek and what could happen with the district, click here. And stay tuned for more news.

Click here to learn about 4 times Disney was sued…and LOST

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The post “Swift and Severe” Harm Hit Disney Following “Don’t Say Gay” Debacle, According to Investor Lawsuit first appeared on the disney food blog.

source https://www.disneyfoodblog.com/2022/12/12/swift-and-severe-harm-hit-disney-following-dont-say-gay-debacle-according-to-investor-lawsuit/

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