New Reedy Creek Board Lawyers Up for Battle with Disney World
At their second meeting, Reedy Creek replacement board discussed its new business, including an agenda item for potential legal challenges aimed at Walt Disney World. This post covers moves they’ve made thus far to lawyer up for litigation, what Disney did that precipitated this, and our commentary about how it all might play out.
Let’s start with a quick recap of what’s happened since we last covered the Reedy Creek Improvement District (RCID) saga. State lawmakers passed a bill that renamed the Reedy Creek Improvement District, while maintaining the special district’s taxing benefits and most of its unique authorities (with some exceptions). The key change was that the Governor of Florida would appoint the district’s board.
Governor DeSantis thereafter signed the bill into law, and appointed members to the newly-dubbed Central Florida Tourism Oversight District (CFTOD). At a press conference, DeSantis announced his five appointees, all of whom are political donors or loyalists, while also proclaiming that there’s a “new sheriff in town” and promising “accountability” for Disney.
Among many other things, DeSantis claimed that the board members would ensure that Walt Disney World will be “what Walt envisioned,” and gave examples of limits his appointees could impose and how future Disney content could be shaped.
Since then, the Central Florida Tourism Oversight District held its first meeting. That mostly revolved around firefighting, COVID-19 policies, and various grievances during a public comments section. Somewhat like a scene in Parks & Rec, but sincere and wholly unentertaining. The actual substance of the meeting was largely uneventful, in equal parts because actual governance is uneventful and because the new board members were unsure of the mechanics for conducting new business.
Someone must’ve bought a copy of Robert’s Rules of Order since then, as the second meeting of the Central Florida Tourism Oversight District was far more eventful. The new Board of Supervisors agenda for their March 29, 2023 meeting contained a plan to obtain “Additional Special Legal Counsel” (Item 8.2 starting on page 61 of the Agenda).
That reveals that the new Board of Supervisors has engaged four different law firms for the following purposes:
Cooper & Kirk will represent the District regarding certain constitutional and contract matters and potential legal challenges for matters involving the District that occurred under the prior board of supervisors and that may involve the Walt Disney Parks and Resorts U.S., Inc. and its affiliates and subsidiary and related entities.
Lawson will represent the District regarding certain constitutional and contract matters and potential legal challenges for matters involving the District that occurred under the prior board of supervisors and that may involve the Walt Disney Parks and Resorts U.S., Inc. and its affiliates and subsidiary and related entities.
Nardella & Nardella will represent the District on those matters specifically assigned by the District and accepted by the firm. Waugh Grant PLLC will represent the District and provide litigation and dispute resolution counsel for the District for any matters designated by the District.
According to reporting from the Orlando Sentinel and WESH’s Bob Hazen, the new Board of Supervisors took issue with a 30-year development agreement made between the Reedy Creek Improvement District and the Walt Disney Company prior to the new Board of Supervisors taking over.
Those agreements consist of restrictive covenants, license agreement, and developer’s agreement that were discussed at a public hearing by RCID on February 8. (The relevant documents can be found here.)
Central Florida Tourism Oversight District asserts that this renders them powerless to offer any oversight over Walt Disney World’s tourist district in Central Florida, effectively undermining their very name! The CFTOD contends that clandestine covenants were made, tying the hands of future board members for decades, according to a legal presentation by CFTOD lawyers during the meeting.
The agreements approved by the prior Board of Supervisors contains language that allows the agreement to remain in effect in perpetuity (or “until twenty one (21) years after the death of the last survivor of the descendants of King Charles III, King of England”) without regard for future action by the new board.
Disney really covered their bases with the agreement, dictating general maintenance standards and including a section titled “Prohibition On Use Of Disney Name.” Among other things, this provides that RCID and its successors (that means CFTOD) cannot use the “Disney” name, nor can it use “any of the fanciful characters (such as Mickey Mouse), designs, symbols, representations, figures, drawings, ideas or other intellectual property owned, developed or created by” Disney in any manner whatsoever. So I guess a King Mickey Mouse meet & greet at the next CFTOD meeting is really out of the question!
Upon discovering these restrictions, the CFTOD’s new Board of Supervisors voted to bring in outside legal counsel to examine the agreement, with one lawyer in attendance presenting on behalf of CFTOD suggesting they should hire more law firms so CFTOD can challenge Disney on even footing, using firms with “deeper bench.”
“We’re going to have to deal with it and correct it,” board member Brian Aungst Jr. said. “It’s a subversion of the will of the voters and the Legislature and the governor. It completely circumvents the authority of this board to govern.”
Board member Ron Peri added: “This essentially makes Disney the government. This board loses, for practical purposes, the majority of its ability to do anything beyond maintaining the roads and maintaining basic infrastructure.”
CFTOD board chair Martin Garcia argued that because of how rich and powerful Disney is, the Board of Supervisors may have to take an “adversarial position” against the company. Garcia further suggested that they might have to go all the way to United States Supreme Court in “protracted litigation” against the Walt Disney Company.
After the meeting was over, Disney released the following statement: “All agreements signed between Disney and the district were appropriate and were discussed and approved in open, noticed public forums in compliance with Florida’s Government in the Sunshine law.”
In terms of commentary, I don’t really know what to say. Throughout the Reedy Creek battle, every effort to predict specific outcomes based on legal analysis has proven futile. In our most recent article that touched upon the RCID takeover, I conceded that this was not how I expected the saga to play out.
With that said, there’s one way I’ve been right on the money all along: that this is not about the law, passing meaningful legislation, or the tough and thankless work of local governance. It’s about political theater; scoring a “win” in today’s era of ‘politics as team sports’ and the ongoing culture wars. The goal isn’t to govern; it’s to grab headlines and dominate the news cycle.
Serious analysis isn’t appropriate here because these aren’t serious people with sincere motivations. That’s likely why Disney opted against fighting this previously and instead put out deferential and conciliatory statements. The company’s calculus was that it’s not as easy to “fight” a one-sided culture war. The satisfaction was in the struggle.
For Disney, it was a matter of choosing the least-bad option and hoping they picked wisely, both in the short and long-term. As we pointed out previously, Disney would be correct assuming that it was dealing with rational actors. The interests of the Central Florida Tourism Oversight District and Walt Disney World would be aligned, as both would want to promote tourism and grow the local economy. However, that’s a fairly bold assumption in the actual current environment.
It’s difficult to say what’s happening here. Did Walt Disney World and Reedy Creek Improvement District execute agreements they otherwise wouldn’t have as an “insurance policy” to give them certainty during an uncertain time? Probably.
Were these agreements “unlawful,” “unusual,” or “suspect” as the new Board of Supervisors claims? Those words are not even remotely synonymous. Not a lot of precedent exists for a corporation to have its own special district that allows said company to act as its own government, so technically, anything that district does is “unusual.” That doesn’t make it unlawful or suspect, especially if those moves are made with transparency and in compliance with Florida law.
Moreover, I wouldn’t trust the assertions of board members who, as recently as this month, did not know how to accomplish the most basic component of the job that they were appointed to do. These individuals not knowing about the existence of an agreement does not make it unlawful, unusual, or suspect. I’ve never visited Massachusetts, but that doesn’t mean it doesn’t exist.
Based on the public record, the agreement between RCID and Disney was made out in the open, following proper notice and hearing requirements. It’s openly available for viewing online. Current CFTOD board members could’ve attended that meeting if they so desired, just as I could board a flight to Boston or wherever.
It’s also entirely possible that the new Board of Supervisors doesn’t believe what they’re saying, and that this is more grandstanding. They needed to find a way to remain relevant and in the spotlight, and not burdened by the unpleasantness of local governance or administrative law. (Ew.) Since Walt Disney World wasn’t helping them out by sticking with the fight, they found a new and exciting way to revitalize it. Beats doing actual work!
In fairness, it also doesn’t mean that the new Board of Supervisors is wrong. It’s entirely possible that these agreements are all of the things that the new-look CFTOD claims. Maybe Walt Disney World wanted to cease the public fight, but give themselves an insurance policy. That could be precisely why the company has released the conciliatory statements–because they knew it didn’t really matter and the new board would have its hands tied.
Perhaps the Walt Disney Company is playing 4D chess, and their calculus is that this new board challenging agreements in court is the better course of action than Disney suing the state. This route definitely does seem more boring and dull, and less likely to garner headlines and captivate the attention of more mainstream audiences. The thing is, we don’t know and won’t know until this is dragged out for more months and/or years, or until the parties tire of it and move on.
Honestly, even as someone who enjoys the Walt Disney Company’s inner-workings, palace intrigue and political machinations, I’m exhausted by all of this. Some of the verbiage in the Developer’s Agreement from February 8 is mildly humorous, but I know that amusement will quickly give way to more unpleasantness. Even as I wasn’t wild about the overall outcome of the Reedy Creek replacement, I was more than ready to put this whole saga in the rearview mirror, hoping that CFTOD just go about its mundane day-to-day business. The characters are one-dimensional and cliche, and the writing in this season has gotten tedious and lazy. If I want dumb drama masquerading as something more, I’ll just watch Succession.
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YOUR THOUGHTS
What is your reaction to the latest season of the Reedy Creek Improvement District drama? Keep the comments civil, and avoid personal attacks or perpetuating pointless culture wars. Respectfully debating the change is totally fine, but don’t attack others or troll for controversy. That’s why Facebook was invented.
Sheldon Cooper, who loves nothing more than writing up complicated contracts, must have had a hand in writing up the perpetuity clause. I see the workings of his brain all over it. I also see Leonard Hofsteder’s face as he reads it.
The “new sheriff in town” is looking more like Barney Fife than Andy Taylor. And this Florida sitcom is far from over. I eagerly await the next chapter.
Agree with your commentary here Tom.
And/but, I think Disney will think twice about including LGBTQ characters for a while in order to avoid controversy in Orlando/Tallahassee. Regardless of your social preferences (in your optional for-profit entertainment!), that’s not the way these things are supposed to work.
While the details of this fight will be tedious the strategies employed will likely be fascinating. Disney originally tried to be agnostic toward the Florida Rights in Education/Don’t Say Gay Law but their own employees forced a reaction (This was one point that Disney really missed Iger’s political savy vs. Chapeks “bull in a China shop” approach). Elimination of Reedy Creek improvement district was a creative answer, that clearly wasn’t well thoughtout as the potential consequences were uncovered quickly. It also gave Desantis national attention on a topic central to his constituent base – but at the same time was a clear move of increasing government authority over a public company, something traditionally very much against Republican values. The potential consequences of elimination of the district were avoided by changing the name and making the board political appointees with no relevent experience (reinforcing a willingness to increase government power over public companies). And of course Disney mitigated potential damage to it’s interests by quietly changing the authority of the board in a manner that sounds legal but likely slightly shady. So now what? At least one board member has suggested taking it as far as the supreme court (a move that could backfire given the suggestion that the structure and new board may not be constitutional?)…at the very least a long legal battle is ahead…I have to believe a long battle favors Disney, the politcal winds are fickle, Desantis got his national attention out of it – a protracted battle will only make more moderate Republicans (of which I am one) begin to question his comitment to smaller government and free markets. Disney has returned to having a savy politician at the helm (Iger) can the Florida Governer prove he is a match?
Noticed I missed the word “Parental” in the name of the law – unintentional omission
“Serious analysis isn’t appropriate here because these aren’t serious people with sincere motivations. ”
The Governor didn’t appoint the CFTOD Board because of their extensive knowledge of public works, negotiating wage deals with unions, water or wastewater systems, or economic development. Rather, they were appointed because they had an ax to grind with a private corporation. Harassment, not public service, is their primary motivation.
If the Governor truly wanted to reform these districts, there would have been a year of research, draft proposals, public hearings, and legislative mark ups and all the districts in the State could have been affected. The fact that this change flowed through a supine Legislature so quickly and was clearly aimed at one corporation, says it all.
Bravo Disney.
All Desantis appointees are part of the good ole boys club. From Central Florida tourism oversight board to Board of Education that have no education experience and all the rest of his cronies with positions and paychecks.
Completely agree, Hooper.
Moreover, RCID/CFTOD *only* oversees Disney property, not Universal or any other “tourist trap”. How DeSantis or the Florida legislature think they can call this the Central Florida Tourism Oversight Board is laughable, because it doesn’t oversee any Central Florida tourist destination besides Disney. It’s just another case of DeSantis’ overreach and his attempt at trying to enforce his vision of what kind of entertainment should be shown at Disney… DeSantis needs to let Disney be Disney and leave them alone — there’s a reason people go to visit there to visit. If people didn’t like what Disney did there, they wouldn’t come. End of story.
Go Disney!
Yes, definitely un-serious people doing un-serious things. We knew this was going to be the case when the qualifications required for board members were released and specifically said the board members could not have relevant experience.
How dare you inject your personal beliefs in this piece. In calling out of Succession as a “dumb drama masquerading as something more” you have gone too far this time Tom!
Well, it is a personal blog
Well, there’s no good nudity, so… Come on, HBO, you can do better!
Wow…. these responses really went political.
Isn’t it a political subject and post?
Because it is a political attack. Nothing else.
I’d rather Disney, the Corporation, ran the parks instead of DeSantis, the “person”. I have heard nothing but bad things about him from my friends who live there since he reared his head.
In the future, maybe Disney should just provide entertainment, instead of giving their political and woke views. Every time companies do this, they alienate half the country. Just keep your mouth shut and run your company. Disney was literally forced to finally give their employees a decent wage. The theme park workers are mostly terrific, but the entertainment, sports and news end are terribly overpaid. If Disney dropped ESPN (which has been an albatross for over a decade), streamlined their overstuffed news division, and fold in the tent of the money pit Disney-Plus, then maybe their stock will rise and their company would make more money.
Disney-Plus cannot get enough, or will they ever, subscribers to cover the cost of the ever expanding shows. They should throw in the towel and merge that money mistake into HULA, which they already owned.
Even if one doesn’t agree with Disney’s views on any subject matter, the government should not be punishing their right to express a viewpoint. Also, with that sound economic plan you shared, I’m surprised you weren’t the choice to lead the company over Iger. If the government can do that to a company like Disney, just imagine what they can do to you.
The whole affair is ridiculous.
I see no reasons why the Disney CEO had to comment on the Parental Rights Act or whatever euphemism was used for controversial education law. Disney can produce movie characters that are openly gay or protect people from discrimination by their company but they are not a PAC.
As for the Florida governor, he is just another archaic male who is insecure about his manliness and who can’t resist getting into a (explicative) contest just to show he’s king of the hill. All he had to do is say, “Disney had their say but this is what we’re going to do. End of story.”
And the Florida taxpayers are going to pay millions of dollars in legal fees and court costs in a futile fight with a company, for whom the legal costs will be pocket change, because of a male ego that got out of hand.
Mike, I agree with most of what you say. Nevertheless, I think it is okay for business leaders to talk out about government legislation that negatively affects their employees and customers. It is no secret that Disney is a company that supports diversity and inclusiveness and I have no problem with Chapek letting the Governor know his concerns.
Agree. A fiasco and DeSantis is a terrible politician.
The “don’t say gay” law which was the basis of this ruckus had nothing to do with Disney and it’s internal workings. It was a law forbidding discussion of gays and lesbians in classrooms, which had nothing to do with Disney. Chapek spoke out because of pressure from stock holders and employees and this controversy was one of the reasons he was fired and the old CEO came out of retirement to try put out this fire – which was to no avail – and fix other problems.
DeSantis is the kind of obsolete, archaic, narcasistic, authoritarian, hard headed, vindicative, old fashioned male who is going to go out of his way to pound down anybody who dares to oppose him, like the corrupt big city machine politicians back in the day. Sort of like a dog that has to mount any other dog just to show he’s top dog. A very destructive and self-destructive type of insecure male who was probably abused verbally and even physically by his father. A classic illustration of Alfred Adler’s theory of the inferiority complex leading to the neurotic quest for money and/or power. I’ve dealt with the type. Even walked away from a high paying job because the boss turned out to be that sort. The world will be better off when they’ve all died out – hopefully.
I’m not greatly interested by the “don’t say gay” political controversy that sparked this conflict but it it amusing, in a morbid way, to see the House of Mouse outwitting DeSantis. And Disney has an inhouse legal department with 380 lawyers headed up by a senior vice president who makes over 15 million per year. Disney is worth 135 billion and rakes in 20 million PER DAY just from their parks. DeSantis and his handpicked board are too blinded by the capital sin of pride to see what they’re getting into. Let the games begin! Start popping the corn and get out your soda pop or beer!
I think there’s a cartoon out their showing Micky Mouse treating DeSantis in a way reminiscent of an infamous scene in an old movie about an encounter between some canoeists on a certain remote river in Georgia and the local folks. Fun, fun, fun!
P.S. – Disney CEO Bob Iger couldn’t leave this alone and now has denounced DeSantis as being anti-business and anti-Florida.
There’s an old saying in politics. Never wrestle with a pig. The pig will love it and you’ll just get yourself muddy.
But then I guess I can’t leave it alone either – wasting time commenting on issues that don’t concern me.
There’s a clown college in Florida. The governor got married at Disney World. Where did he go to school? He appoints people who have no experience nor qualifications to govern. Now there’s multiple law firms hired which will only enrich the law firms in fees for the next 5 or 10 years. Who pays the bills the governor keeps racking up? We sure don’t need him in DC so you good people of Florida made him. You keep him.
The 4 law firms hired by the board one of which is charging $795 an hour will be paid for by the citizens inside their taxing district. All his other legal fees and Atorney General costs are paid by the fine citizens of FL including the republicans that voted for them. Desantis went to school at Harvard though I believe before going into the US Navy. We will gladly ship him to share with the Country.
Well, that clown would be better in DC than the broken robot there now. but then, who wouldn’t be better?
It is very disturbing that the Florida governor wants so much control over a private company. The Disney Company for the most part provides more than just entertainment and creativity. They employe a lot of people, sadly 7,000 jobs are ending. Hopefully these good people can find jobs else very quickly. That being said, why make one of the most know companies world wide a political pawn. Really the Florida governor is a bit Authoritarian. Let’s a just be good neighbors and good Americans!
I think its disturbing that a corporation should be allowed so much power. DeSantis will not let this go unanswered. Disney has always been the bully in the school yard and Im glad someone is standing up to them, even if it is just “theatre” as Tom says.
Just as it was said..”These people were hand picked by DeSantis”. They don’t have a clue as to what to do. They said that it goes around the voters, legislature, and the governor.. No it goes around our governor who skin is to thin to handle someone saying something about a law that shouldn’t even be on the books. He is nothing but weak, whiny little baby.
Did the New Sheriff in Town get Out Foxed by a Mouse ???
Did I miss the part where the “voters” wanted DeSantis to do this? Didn’t DeSantis just decide to take down Disney and Reedy Creek because they voiced an opinion different than his?
Yes that’s right. The public didn’t want him to do this. The voters voted for Desantis and the super majority “rubber stamp” legislators but didn’t vote for this and public opinion was against it. A representative in southwest Florida first thought of this I believe it was and Randy Fine jumped on board and gave Desantis the idea and he got all excited.
I agree 100% with your commentary here, and the whole thing sickens me. The politics, the grandstanding, the big government control over businesses and individuals that DeSantis clearly favors, all of it. Reedy Cteek wasn’t about the Disney corporation, how it was run, content it creates, or any of the things he was promising the new board would be able to change, so therefore of course the new board would not be expected to be about that either. Stick to public services and infrastructure and stay in your under qualified lane, CFTOB.
I think it’s kind of cool that this episode has, for once, united Disney fans in support of Disney!
Disney proved it did the right thing when yesterday the board member told the media that he didn’t “think” that the board wanted to deteriorate the guest experience or the Disney work and etc… It’s the “think” that is troublesome and meant that one or more of the board members may have wanted to or in the future an extremist board member could do that very action. State government has no business commandeering private business or their assets even over a petty bickering by a out of control governor or legislature. Or to violate their 1st amendment rights. Not even the largest private corporation in the state that built this state.
The King Charles III descendants to deal with the Rule Against Perpetuities was a particularly nice touch.
Also, if anything, Disney got this idea from Republican state governments. Recently there has been a trend whenever a Democrat has won an election to a statewide position where Republicans controlled the state legislature, the legislatures would move to severely limit the powers of that position before the Democrat took over. The most egregious examples of this were in Wisconsin and North Carolina.
You’re right on! I live in Wisconsin and know first hand what you’re talking about! It works for the Republican’s but when its done for them, they cry about it.
And as Charles’ grandmother (the Queen Mum) was 102 when she died, and his mother (Queen Elizabeth II) was 96 or 97 when she died… this agreement could be in effect for 100 years or more… Well played Disney. It seems that DeSantis’ ‘Ivy League’ law degree is a bit lacking…
Why did DeSantis feel the need to mess with Mickey Mouse? Mickey is one of the most iconic characters across so many generations. Did he really think that it would improve his chances at the Republican nomination or even winning the Presidential vote? I don’t think so. I think that he made a mistake!
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