The legal battle between Florida Governor Ron DeSantis and The Walt Disney Company is escalating. Florida’s attorney general is asking the court to dismiss Disney’s lawsuit, arguing the federal court lacks jurisdiction. Yahoo Finance reporters Alexis Keenan and Alexandra Canal join the Live show to explain the latest legal developments and what they mean for Disney customers and investors.
JULIE HYMAN: We’ve got an update on the ongoing dispute between 2024 presidential hopeful Ron DeSantis and Disney. The Florida governor’s attorneys filed a motion on Monday seeking the dismissal of Walt Disney company’s lawsuit against him. Here with more, Yahoo Finance’s Alexandra Canal and Alexis Keenan. So Alexis, let’s start with you. What is the argument coming from DeSantis’s lawyers?
ALEXIS KEENAN: So what the lawyers are saying– and this is the attorney general of Florida coming in here on his behalf and on the behalf of other Florida officials, and it relates to Disney’s federal case filed months ago saying that the lawmakers in Florida as well as DeSantis kind of got together to pass these laws and signed into law a string of state laws actually that take away and strip from Disney its right to self govern a roughly 25,000 acre parcel around Orlando on which its Walt Disney World and other related properties sit.
Now, this motion specifically is asking the court to toss out this federal case, which is filed in federal district court in Florida in Tallahassee. They say that this case has no place in the federal district court, in federal courts at all. They say that there is immunity for DeSantis and one of the other officials named in this lawsuit.
As far as the federal court’s jurisdiction, they’re arguing– DeSantis here saying that the court has no jurisdiction over them, that the 11th Amendment in the Constitution protects them from this type of suit coming after– in a federal capacity coming after a state and state officials. On the other hand, the immunity angle here, DeSantis and the others are arguing that they should be immune because of legislative immunity. Kind of an interesting argument there. DeSantis not necessarily a legislator but saying that he’s acting– when he signed this law into law, he was acting in a legislative capacity.
Separately though, the new board that is now controlling this swath of land on which Disney World sits, they too have a suit against– against the special district. They sued Disney saying that the company should not be able to go forward and continue to govern this land. So kind of dueling lawsuits here.
BRAD SMITH: And Allie, what’s the impact of this on Disney?
ALEXANDRA CANAL: I think the impact is going to be different depending on the perspective that you look at it. From a consumer perspective, the parks are fully operational. You can go to Disney. I don’t think you would realize anything was going on. But from a company perspective, the concern is that if Disney wanted to create more parks, if they wanted to do some other type of infrastructure building, they would need the approval of the Oversight Committee, whereas before they were able to do these changes and whatever they wanted pretty seamlessly. So that is a concern from Disney’s perspective.
Now, from the employee perspective, I think they’re happy that Bob Iger has consistently spoken out against DeSantis. He’s defended the company’s actions. He actually said, all right, does the state of Florida not want us to invest in the state of Florida? Disney has plans to invest $17 billion over the next 10 years creating 13,000 jobs. And you could argue that that was the demise of Bob Chapek. That’s what started this all. He initially chose not to speak out about this issue, and that created this ripple effect that eventually led to Bob Iger returning.
From an investor perspective, doesn’t really seem to matter, right? The stock is flat. Positive territory right now. We just got two buy ratings– reiterating their buy ratings from Bank of America and Guggenheim this morning. So I think unless we see any fundamental impact on the bottom line of Disney, it’s nothing that’s going to affect the stock price. But I do think this– these are lawsuits that are going to take– it’s going to take a lot of time before we get a conclusion to all of this.
JULIE HYMAN: Right, it feels more like sort of culture wars than it does something that’s going to have an effect on the company. But I guess we’ll see. Thanks, guys, for keeping us posted on this lawsuit. We’ll see how it turns out eventually. Allie and Alexis. You’re watching Yahoo Finance.