The Walt Disney Company has won a lawsuit brought against it by a shareholder who argued that Disney acted negligently when it criticized Florida Governor Ron DeSantis and the Florida State Legislature over a sexual identity law. The lawsuit was brought against Disney by shareholder Kenneth Simeone.
In the lawsuit, Kenneth Simeone sought internal records from Disney which included board member emails to investigate possible wrongdoing by the board members. The lawsuit was brought about against Disney in December of 2022.
Judge Lori Will, however, said that the case was improperly directed by a conservative legal group. Judge Hill also rules that Simeone could not use a provision of Delaware corporate law meant to empower shareholders to investigate boardroom wrong doing in an effort to “search for hypothetical conflicts.”
The judge did acknowledge that Disney’s criticism of the “Don’t Say Gay” law in 2022 might have been a bad business decision. However, the evidence in the trial showed now evidence that the board of directors allowed their personal vides to dictate the company’s response to the bill. This ruling means that Disney will not be required to hand over the internal records which Simeone requested.
The judge also acknowledged that the lawsuit appeared to have been made in an effort to benefit the Thomas More Society. This is a non-profit law firm known for advocating conservative causes. The firm covered Simeone’s legal costs. The judge emphasized that a corporate records lawsuit should not be used as a platform to advance personal beliefs. Judge Will wrote, “The plaintiff’s counsel and the Thomas More Society are entitled to their beliefs,” and continued that the corporate records lawsuit “is not a vehicle to advance them.”
The criticism of the “Don’t Say Gay” law didn’t just lead to this lawsuit. It also led to a controversy with Governor DeSantis and most of the Florida state leaders that is continuing on to today. This has led to a lawsuit in Federal Court by Disney against DeSantis, state leaders, and also the new board of directors of the Central Florida Tourism Oversight District. This was followed by a countersuit by the Central Florida Tourism Oversight District board in state court. Both of these lawsuits remain unresolved.
While this won’t have a major impact in the controversy between Disney and Governor DeSantis. It is one less thing for The Walt Disney Company to worry about in regards to its stance on the “Don’t Say Gay” bill. The Federal lawsuit will most likely be the main determiner of the future of the controversy.
