Judge dismisses Disney suit against DeSantis over special tax district

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AP DeSantis November 2022

Republican Florida Gov. Ron DeSantis speaks in November 2022 in Las Vegas. (Photo by John Locher/The Associated Press)

In a legal victory for Florida Gov. Ron DeSantis (R), a federal judge in Tallahassee dismissed on Wednesday a lawsuit filed by the Walt Disney Co. over the state’s dismantling of the entertainment giant’s special taxing district.

Disney sued DeSantis last year, claiming that the Republican governor had violated the company’s freedom of speech when he asked state lawmakers to dissolve the Reedy Creek board that manages the 25,000 acres that encompass Walt Disney World in central Florida.

The company alleged DeSantis targeted Disney after its CEO opposed the Parental Rights in Education bill, referred to as “don’t say gay,” in 2022.

Judge Allen Winsor of the U.S. District Court for Northern Florida ruled that Disney “lacks standing to sue the governor” and that the law it was suing over was constitutional. He also noted that the changes lawmakers made to Disney’s former special district “works to Disney’s significant detriment” because “now it faces land use decisions by a board over which it has no control.”

DeSantis’s office celebrated the decision.

“This ruling finally ends Disney’s futile attempts to control its own special government and receive benefits not available to other businesses throughout the state,” DeSantis spokesman Jeremy Redfern said in a statement.

Disney issued a statement after the dismissal Wednesday, vowing that the company would “press forward” with its case but not specifying how.

“This is an important case with serious implications for the rule of law, and it will not end here,” the statement said. “If left unchallenged, this would set a dangerous precedent and give license to states to weaponize their official powers to punish the expression of political viewpoints they disagree with.”

Attorneys for the Central Florida Tourism Oversight District board that DeSantis installed last year to oversee Disney’s property called the case “a frontal assault on this bedrock principle of our constitutional order.” The previous taxing entity had given the company “de facto authority to govern itself through handpicked board members,” they contended.

But attorneys for Disney argued that DeSantis was punishing it for exercising First Amendment rights to criticize the government and using a “relentless campaign to weaponize government power” and squelch free speech.

A group of mostly Republican former governors and other top state officials from around the country filed an amicus brief of support and likened DeSantis’s actions against the company to the way the leaders of China and Russian handle criticism.

“[We] understand, as the Founders did, that debates over public policy are to be welcomed, not feared; spirited debate is the lifeblood of a healthy democratic process,” the amicus brief states. “The proper role of a governor when faced with such dissent is to engage with it, not to suppress or punish it through the exercise of government power.”

Winsor’s decision is the latest chapter in a two-year-old feud between Disney and DeSantis.

It started when Disney’s CEO at the time, Bob Chapek, came out against proposed legislation to prohibit discussion of gender-related issues in public schools. DeSantis was championing the Parental Rights in Education bill and lashed out at the company.

The GOP supermajority in the legislature went along with the governor’s push to wipe out the Reedy Creek Improvement District, the special taxing entity that for half a century had managed the land around Disney World near Orlando.

When local officials in the two counties where Disney operates said that action left them with Disney’s $1 billion tax debt, legislators passed another law to re-create the taxing district, with board members appointed by the governor. They named the district the Central Florida Tourism Oversight District.

The new board held its first meeting in April. Disney filed suit in federal court minutes after it ended. Board members then countersued Disney in state court, claiming that actions taken by the outgoing group took away almost all of their governing power.

The state case is moving forward because the judge hearing it rejected Disney’s motion for dismissal.

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