Disney, Ron DeSantis reach settlement in lawsuit over Central Florida Tourism Oversight District

Disney's lawsuit against DeSantis dismissed

A federal judge on Wednesday dismissed Disney's free speech lawsuit against Florida Gov. Ron DeSantis, leaving the company's remaining hopes of regaining control of the district that governs Walt Disney World to a separate state court challenge.

ORLANDO, Fla. - Allies of Gov. Ron DeSantis and Disney reached a settlement agreement Wednesday in a state court fight over how Walt Disney World is developed in the future following the takeover of the theme park resort’s government by the Florida governor.

In a meeting, the DeSantis-appointed members of the board of the Central Florida Tourism Oversight District approved the settlement agreement, ending almost two years of litigation that was sparked by DeSantis’ takeover of the district from Disney supporters following the company’s opposition to Florida’s so-called "Don’t Say Gay" law.

The 2022 law bans classroom lessons on sexual orientation and gender identity in early grades and was championed by the Republican governor, who used Disney as a punching bag in speeches until he suspended his presidential campaign this year.

The district provides municipal services such as firefighting, planning and mosquito control, among other things, and was controlled by Disney supporters for most of its five decades.

The agreement came a day after the appointment of a new board member, replacing a DeSantis-appointed board chairman who was a Disney critic. Under the deal, covenants and a development agreement Disney supporters on the board made with the company just before the state takeover would be dropped and the new board agreed to operate under an earlier plan.

Jeff Vahle, president of Walt Disney World Resort, said in a statement Wednesday that the company was pleased a settlement had been reached.

"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," Vahle said.

DeSantis, who was in Orlando on Wednesday, said at a news conference that "we have been vindicated on all those actions."

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"I’m glad that they were able to do that settlement," DeSantis said. "Those 11th hour covenants and restrictions were never going to be valid. We knew that."

As punishment for Disney’s opposition to the controversial law, DeSantis took over the governing district through legislation passed by the Republican-controlled Florida Legislature and appointed a new board of supervisors. Disney sued DeSantis and his appointees, claiming the company’s free speech rights were violated for speaking out against the legislation. A federal judge dismissed that lawsuit in January, but Disney appealed.

Before control of the district changed hands from Disney allies to DeSantis appointees early last year, the Disney supporters on its board signed agreements with Disney shifting control over design and construction at Disney World to the company. The new DeSantis appointees claimed the "eleventh-hour deals" neutered their powers and the district sued the company in state court in Orlando to have the contracts voided.

Disney filed counterclaims that included asking the state court to declare the agreements valid and enforceable.

Under the terms of Wednesday’s settlement agreement, Disney lets stand a determination by the board of DeSantis appointees that the comprehensive plan approved by the Disney supporters before the takeover is null and void. Disney also agrees that a development agreement and restrictive covenants passed before the takeover are also not valid, according to the settlement terms.

Instead, a comprehensive plan from 2020 will be used with the new board able to make changes to it, and the agreement suggests Disney and the new board will negotiate a new development agreement in the near future.

Disney also agreed to put on hold the appeal of the federal lawsuit pending the negotiations on the development agreement and will drop a public records lawsuit against the district it was pursuing in state court.

"It looks to me like both sides called ‘uncle,’" said Richard Foglesong, a Rollins College professor emeritus who wrote a definitive account of Disney World’s governance in his book, "Married to the Mouse: Walt Disney World and Orlando."

"Disney has an interest in ending this and so does the oversight board," he added. "So, they both win."

Since the takeover last year, the district has faced an exodus of experienced staffers, with many in exit surveys complaining that the governing body has been politicized since the changeover. Just this month, the district’s administrator, Glen Gilzean, left to become a county elections supervisor at half the $400,000 salary he was earning at the district, and the district’s DeSantis-appointed board chairman, Martin Garcia, departed the following week.

In their place, DeSantis on Tuesday appointed Orlando businessman Craig Mateer to the board and board members on Wednesday approved former DeSantis advisor Stephanie Kopelousos to be the district’s new administrator.

Mateer, a donor to DeSantis campaigns, previously had been appointed by the governor to the Greater Orlando Aviation Authority and the Board of Governors, which oversees the state university system. Kopelousos was director of legislative affairs for DeSantis. She also had served as secretary of the Florida Department of Transportation under then-Florida Gov. Charlie Crist and was a former county manager in northeast Florida.

Garcia was a vocal critic of Disney and his replacement by Mateer, who is well-known in Orlando tourism and business circles, may have made Disney comfortable enough with the board to reach an agreement, Foglesong said.

Board member Charbel Barakat said the board was looking forward to taking a more cooperative approach with the entertainment giant.

"We are eager to work with Disney," Barakat said after the settlement deal was approved.