Legal Theory

What legal theory is Disney using to sue Florida Gov. Ron DeSantis?

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People mill around in Disney World in Orlando

Guests mill around in front of Magic Kingdom Park at Walt Disney World Resort in Orlando, Florida, in 2018. Photo by Kyodo via the Associated Press.

Disney’s federal lawsuit against Republican Florida Gov. Ron DeSantis alleges that he violated several constitutional protections by retaliating against the company for its political speech.

The April 26 suit, filed Wednesday in the Northern District of Florida, seeks confirmation of contractual agreements reached between Disney and its self-governing improvement-district board before its renaming and takeover by DeSantis appointees.

Disney also is asking the court to overturn laws that made the board changes possible and to find that the new board’s renunciation of the contracts is unlawful.

Disney claims that DeSantis sought the legislation in retaliation for the company’s vocal opposition to the “Don’t Say Gay” law, which limits classroom discussion of sexual orientation and gender identity.

“This government action was patently retaliatory, patently anti-business and patently unconstitutional. But the governor and his allies have made clear they do not care and will not stop,” the suit said.

The agreements between Disney and its prior board were tools to secure long-term development plans on Disney property, according to the suit.

A development agreement permits Disney to use its land “up to a defined maximum development program,” including how much that Disney can devote to commercial, retail, restaurant and hotel space, according to the suit. The agreement also allows Disney to build one additional major theme park and two additional minor theme parks through 2032.

The other agreement was a declaration of restrictive covenants that give Disney the power to review the appearance of exterior improvements to its properties, require Disney approval for the district’s use of Disney names and characters, and ban the district from selling merchandise referring to Disney.

The new board still has the power to exercise limited governing powers, including the authority to impose some taxes, build and maintain roads, provide emergency services, adopt and enforce building codes, and operate utilities.

The suit cites five causes of action. They are:

  • The new oversight board’s abrogation of the two agreements violates Disney’s rights under the contracts clause. “The substantial—indeed, total—impairment of Disney’s contract rights was not ‘necessary’ to serve an ‘important’ government interest, as required to survive contracts clause scrutiny,” the suit says.
  • The new oversight board’s declaration that Disney’s agreements are void and unenforceable violated Disney’s rights under the takings clause of the Fifth Amendment. “When a law overrides ‘substantive’ contract rights in ‘specific’ real property, the clause’s protections apply,” according to the suit.
  • The new board’s renunciation of Disney’s contracts violated the due process clause of the 14th Amendment. “The due process clause forbids any state or local entity from adopting any ‘arbitrary and irrational’ legislative act affecting a person’s state-created rights—including property interests,” the suit said.
  • The new governing board’s “retaliatory interference” with the Disney agreements is an unconstitutional chilling of Disney’s speech in violation of the First Amendment.
  • Changes in the district board overseeing Disney chilled Disney’s speech in violation of the First Amendment.

Defendants include DeSantis and members of the new governing board.

A DeSantis spokesperson commented in a statement forwarded to the Associated Press.

“We are unaware of any legal right that a company has to operate its own government or maintain special privileges not held by other businesses in the state,” the statement said. “This lawsuit is yet another unfortunate example of their hope to undermine the will of the Florida voters and operate outside the bounds of the law.”

Disney is represented by Wilmer Cutler Pickering Hale and Dorr, by O’Melveny & Myers and by Losey.

The judge in the case is Chief U.S. District Judge Mark E. Walker of Tallahassee, Florida, a nominee of former President Barack Obama.

Reuters reports that Walker “has struck down several laws that defined DeSantis’ conservative political agenda, including statutes that sought to limit the speech of college professors, curtailed protests and restricted voting access.”

Other publications covering the suit include the New York Times, Courthouse News Service and Law360.

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