News Reedy Creek Improvement District and the Central Florida Tourism Oversight District

[monothingie]

Based on public statements, Disney wanted to cool things off some time ago.

But with DeSantis running for president, any deal would have been spun as a DeSantis loss by his opponents.

Now that he’s no longer running and the national spotlight is no longer on him, I suspect DeSantis was willing to agree to the deal that Disney wanted to make all along.

Disney wants profitable business growth in Florida. This agreement supports that.

I agree, Disney started putting feelers out for wanting to settle and tone this down at the end of 2023 and after the setbacks in the various court cases, they realized that it would be increasingly difficult to put things back to the way they were. I agree with you on the Governor, but I will add that it was likely not the State of Florida initiating settlement talks with Disney, but the other way around.

 

[Vegas Disney Fan]

I agree, Disney started putting feelers out for wanting to settle and tone this down at the end of 2023 and after the setbacks in the various court cases, they realized that it would be increasingly difficult to put things back to the way they were. I agree with you on the Governor, but I will add that it was likely not the State of Florida initiating settlement talks with Disney, but the other way around.

I think this is exactly how it went down, Disney’s been trying to resolve this for a year but DeSantis was dug in for personal reasons, now that he’s out of the election FL could finally sit down and listen to what Disney was offering without it “damaging” a campaign. 2 years of infighting with one of your state’s largest employers/revenue generators, and millions of tax dollars spent on lawyers, for political reasons, what a fiasco.

 

[monothingie]

I think this is exactly how it went down, Disney’s been trying to resolve this for a year but DeSantis was dug in for personal reasons, now that he’s out of the election FL could finally sit down and listen to what Disney was offering without it “damaging” a campaign. 2 years of infighting with one of your state’s largest employers/revenue generators, and millions of tax dollars spent on lawyers, for political reasons, what a fiasco.

I don't disagree, but both sides were pretty much dug into their positions. Once the actual court cases started going sideways for Disney there was the realization that some type of settlement needed to be worked out. Just coincidentally it occurred after the Governor's political campaign ended.

 

[Chi84]

There's a lot of nuance with the court cases that isn't apparent from news reports. The state case required determinations of fact issues, which means it was unlikely to go out on summary judgment for either side. That's why depositions were being taken - to flesh out what facts needed to be determined in court.

In the federal case, the district judge dismissed the case at the pleadings stage based on his determination of the law (in fact, the application of a single case), which is the easiest determination to overturn on appeal. The appellate court would give no deference at all to the district court's judgment. And that particular judge has a history of being overturned by the 11th circuit. See Warren v. DeSantis USCA11 No. 23-10459 (reversing Allen Winsor), where the concurring judge stated "the state can't exercise its coercive power to censor so-called 'woke' speech with which it disagrees. What's good for mine is (whether I like it or not) good for thine." That's the decision that stood - not Judge Winsor's judgment.

Where courts are involved, this kind of nuance is everything. The point is that neither of these cases were anywhere near to being over when this settlement was reached.

 

[pdude81]

They can't pretend they are holding off on new development as a threat to the state while telling investors they are supercharging new development in the state. Those two things can't happen at the same time. And as the major taxpayer in the district, we know Disney was footing the bill for these "studies" designed to damage their reputation.

And while they have dismissed the suit/countersuit and avoided setting a potentially bad legal precedent in Florida in relation to the development agreement, they only closed off the claims made in that specific state case.

Would they be allowed a referendum by a certain percentage of voters in district to change the voting type for board seats? Or is that something that only the board can do? In my local district up north it is not that hard to get a ballot question up, as long as you follow the rubric and have enough signatures, but I don't know if similar rules apply for a multi-county special district in Florida.

 

[mikejs78]

I don't disagree, but both sides were pretty much dug into their positions. Once the actual court cases started going sideways for Disney there was the realization that some type of settlement needed to be worked out. Just coincidentally it occurred after the Governor's political campaign ended.

Nothing in the court case that is the subject of this settlement went sideways. In fact, another interpretation was that depositions were about to start and DeSantis and the CFTOD didn't want certain things to become public record.

 

[Sirwalterraleigh]

They can't pretend they are holding off on new development as a threat to the state while telling investors they are supercharging new development in the state. Those two things can't happen at the same time. And as the major taxpayer in the district, we know Disney was footing the bill for these "studies" designed to damage their reputation.

And while they have dismissed the suit/countersuit and avoided setting a potentially bad legal precedent in Florida in relation to the development agreement, they only closed off the claims made in that specific state case.

Would they be allowed a referendum by a certain percentage of voters in district to change the voting type for board seats? Or is that something that only the board can do? In my local district up north it is not that hard to get a ballot question up, as long as you follow the rubric and have enough signatures, but I don't know if similar rules apply for a multi-county special district in Florida.

They can say whatever they want. It’s not against any rules as long as you don’t say something binding that directly affects financial responses. Disney never does that. All things plausibly deniable.

Disney lost their ability to issue public bonds…which makes any large expansion unlikely as it stands now

 

[Sirwalterraleigh]

Nothing in the court case that is the subject of this settlement went sideways. In fact, another interpretation was that depositions were about to start and DeSantis and the CFTOD didn't want certain things to become public record.

Mmmmm…I don’t think it would have played out in Disneys favor that way…

But if it did…then the shareholders should be livid they settled…ceding their control over development/master planning over to a political board that will have as much Comcast influence on it as TWDC as time goes on

 

[Cliff]

They can't pretend they are holding off on new development as a threat to the state while telling investors they are supercharging new development in the state. Those two things can't happen at the same time. And as the major taxpayer in the district, we know Disney was footing the bill for these "studies" designed to damage their reputation.

And while they have dismissed the suit/countersuit and avoided setting a potentially bad legal precedent in Florida in relation to the development agreement, they only closed off the claims made in that specific state case.

Would they be allowed a referendum by a certain percentage of voters in district to change the voting type for board seats? Or is that something that only the board can do? In my local district up north it is not that hard to get a ballot question up, as long as you follow the rubric and have enough signatures, but I don't know if similar rules apply for a multi-county special district in Florida.

Additionally,...I read that all of this does NOT stop the State Investigator General from moving forward. It also has no effect on the "third-party" investor organizations suing Disney over the complaints about the public bonds and more.

There are other serious cases that could easily involve more digging, more investigation and more discovery for more court cases down the road where Disney is at legal risk. It's safe to assume that more legal court drama is coming.

Could Disney have surrendered it's fight in order to save it's actual "employees" and ex-RCID staff from being legally liable and in danger? I have to think or hope this was not a factor???.

Padora's box was opened BIG here for MANY legal outsiders to see.

As Disney fans,...yes, we are sure that Disney has done nothing wrong. However, non-Disney fans do not see the world in the same way we do.

 

[monothingie]

Nothing in the court case that is the subject of this settlement went sideways. In fact, another interpretation was that depositions were about to start and DeSantis and the CFTOD didn't want certain things to become public record.

It was going so well for them at the state level that they basically capitulated to everything the state sought?

It was a legal quagmire going nowhere for either side anytime soon. Disney more so than the state needed to move on from this.

 

[Chi84]

Nothing in the court case that is the subject of this settlement went sideways. In fact, another interpretation was that depositions were about to start and DeSantis and the CFTOD didn't want certain things to become public record.

There are people who are determined to discuss this in simplistic terms (won! lost!); my earlier post was just to clarify for the ones who are interested in the nature of court cases.

The fact is that almost no federal civil cases reach trials. Both cases were destined to be settled. Just need two parties willing to do so.

 

[Tha Realest]

There are people who are determined to discuss this in simplistic terms (won! lost!); my earlier post was just to clarify for the ones who are interested in the nature of court cases.

The fact is that almost no federal civil cases reach trials. Both cases were destined to be settled. Just need two parties willing to do so.

How many of these objectives came about?

Does the CFTOD exist?
Was the RCID reconstituted?
Are board members elected by the landowners?
Do the development agreements enacted in early 2023 still remain in effect?

 

[LSLS]

So this is just for the state lawsuit, correct? And this would be the contract laws part of the lawsuit?

If Peltz wins, he will gain 100% access to ALL of Disney's most sensitive documents, reports and metrics. All the finances, all the taxes, all the profit and loss. He will see every penny of the 16 billon they have spent on Disney + etc...

Peltz will see every single scrap of information that Disney does NOT want public......ever.

If Disney did nothing illegal and everything was properly reported and accounted for...Disney can literally LAUGH at Peltz and throw food at him has he sits in his lonely boardroom corner. They can COMPLETELY ignore him.

Ummm,....well? In the extreme UNLIKELY event Peltz "does" find severe misreporting or other problems? Ohhhh boy....Peltz is REQUIRED to blow the whistle and snitch to the IRS, SEC and DoJ. Yes,...THAT scenario could take down the ENTIRE board "if" they were all aware of what Peltz finds.

For the record, I don't think Peltz will win a seat and if he does?...I don't think he will find any legal problems.

I just can't figure out why Iger is so afraid of one man.....Iger of ALL people knows that Disney is "clean" and safe.

So you think a guy that invested billions in Disney's goal is to find gross misconduct in finances, report it, and tank the stock price? His goal is NOT to just cut things bare bones and get as much money as possible out of the short term, he is trying to destroy everything if at all possible?

 

[flynnibus]

And while they have dismissed the suit/countersuit and avoided setting a potentially bad legal precedent in Florida in relation to the development agreement, they only closed off the claims made in that specific state case.

The settlement actually included a wide range of release of claims by both parties attributed to things that 'have been, or could have been' part of the two state lawsuits.

 

[RobbinsDad]

I don't claim to understand all the nuances of this legal situation, but I can perceive one thing: both sides were losing. DeSantis lost considerable political clout nationally once he realized the fight with Disney was not popular beyond the extreme right. He assumed people in the state and beyond largely saw Disney as this woke organization that has abused their power for too long. He couldn't separate corporate Disney from DisneyWorld, something he sort of alluded to with the Burbank vs. Orlando statement. So he's decided to pivot to "DisneyWorld Savior", the man who will assume credit for spurring economic growth through park development, although it was already in play before now. As for Disney, they lost the early momentum from the unjustified RCID coup, and their protracted legal fight was getting to be perceived as stubborn, particularly after DeSantis dropped out of the presidential race. Ultimately neither side got what they want from this, other than to just get out of it.

 

[Just JBC]

Could Disney have surrendered it's fight in order to save it's actual "employees" and ex-RCID staff from being legally liable and in danger? I have to think or hope this was not a factor???.

This was the first thing I thought when I read the settlement. It appears to absolve Reedy Creek of any/all malfeasance that may have occurred during the prior administration. And since we know that the Board consisted of "landowners" who Disney trusted enough to (temporarily) sell land in the company controlled cities, there may have been an indemnity clause that would protect those favored employees if they were sued in their capacity as a Reedy Creek Board member.

From the investigative witch hunt, it did look like giving employees "free" Disney passes and discounts should have become a taxable perk once the value of those passes were no longer de minimus (so probably around 15-20 years ago). There were also allegations of improper/inadequate record keeping (which seems extra rich considering the current discovery disputes). That liability risk seemed like the biggest thing that Disney gained from this settlement.

It will be interesting to see what happens going forward, especially now that so many of the prior employees have left.

 

[Cliff]

This was the first thing I thought when I read the settlement. It appears to absolve Reedy Creek of any/all malfeasance that may have occurred during the prior administration. And since we know that the Board consisted of "landowners" who Disney trusted enough to (temporarily) sell land in the company controlled cities, there may have been an indemnity clause that would protect those favored employees if they were sued in their capacity as a Reedy Creek Board member.

From the investigative witch hunt, it did look like giving employees "free" Disney passes and discounts should have become a taxable perk once the value of those passes were no longer de minimus (so probably around 15-20 years ago). There were also allegations of improper/inadequate record keeping (which seems extra rich considering the current discovery disputes). That liability risk seemed like the biggest thing that Disney gained from this settlement.

It will be interesting to see what happens going forward, especially now that so many of the prior employees have left.

Interesting! I have a feeling that many Disney and RCID (current or past) employees are breathing a sigh of relief this week. Especially people's names that are all over Disney and RCID email communications over the years.

I could imaging them saying: "It's not my fault, I was only doing what the company wanted me to do. It was my job"

Yeah,..this ending is a good one for soooo many people.

 

[mikejs78]

It was going so well for them at the state level that they basically capitulated to everything the state sought?

It was a legal quagmire going nowhere for either side anytime soon. Disney more so than the state needed to move on

So here is where I think you are right. The case was a quagmire - CFTOD dragged its feet on discovery, and we were looking at a hearing on a motion for summary judgement later this year. There would likely be other motions after that, before even getting to trial. A trial at this point was looking to be mid next year at the earliest. Add appeals and we were looking at 2027 at least before this case was resolved.

Disney can't afford to wait that long given their development plans. They need certainty around their operating model, and they need a district they can work with. So they did capitulate on the lawsuit for that reason. Not because their case was necessarily weak, but that protracted legal uncertainty was bad for business.

They did capitulate, but on the condition of negotiations for a new development agreement. They are keeping the federal case open as a means of ensuring that a new agreement gets done. Remember, Disney wasn't going to fight the Reedy Creek loss, it was only when the development agreement was terminated that they did. They also didn't want a state trial - they tried to get that dismissed. They made a pragmatic decision to resolve quickly rather than fight for years in state court.

 

[lazyboy97o]

They are keeping the federal case open as a means of ensuring that a new agreement gets done.

I would still genuinely like an explanation for how this ensures anything for Disney. If they don’t get a new agreement then they’re back to waiting years for a resolution while local conditions are able to deteriorate.

 

[Stripes]

I think the hint is in Jeff Vahle’s statement. DeSantis and Disney worked out a deal. That’s why we’ve seen so much change recently at the district.

“We are pleased to put an end to all litigation pending in state court in Florida between Disney and the Central Florida Tourism Oversight District. This agreement opens a new chapter of constructive engagement with the new leadership of the district and serves the interests of all parties by enabling significant continued investment and the creation of thousands of direct and indirect jobs and economic opportunity in the State.”
-Jeff Vahle, Walt Disney World Resort President