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Florida judge throws out lawsuit over Disney World dissolution

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TAMPA, Fla. (WFLA) — The first lawsuit filed in Florida over state lawmakers’ efforts to dissolve the Reedy Creek Improvement District, physical home of Walt Disney World, has failed. A judge in the Southern District of Florida dismissed the case on May 10.

Since the initial passage of Senate Bill 4C, which dissolved independent special districts in Florida which were established before 1968, the year Florida ratified its state constitution, concern over tax burdens and legality have abounded.

From the Orange County Tax Collector predicting property tax rates would go up at least 15% to cover RCID’s bond debts to the Walt Disney Company itself saying the law could not be enacted due to stipulations in the Reedy Creek Charter, the dissolution of Walt Disney World’s special governing status has been subject to tense disagreement over next steps.

Three Florida residents, living in Orange and Osceola counties, sued Gov. Ron DeSantis and other state officials over the legal effort, which they said “violates Florida taxpayers’ federal constitutional rights as well as their clearly delineated rights under the Florida Bill of Rights for Taxpayers,” in a lawsuit filed May 3.

Now, Judge Cecilia M. Altonaga, Chief U.S. District Judge, has ordered the case closed, though it was not dismissed without prejudice.

Altonaga’s judicial decision said the plaintiffs claims did not sufficiently show how they were injured by the legislation seeking to dissolve Disney’s special status in Reedy Creek. The judge’s decision cited multiple “jurisdictional defects” in the case, as well.

“At least three jurisdictional defects compel dismissal of the Complaint,” Altonaga wrote in her decision. At issue was jurisdiction of where the lawsuit was filed. The plaintiffs, Michael Foronda, Edward Foronda, and Vivian Gorsky, sued state officials over a state law, but in federal court.

Altonaga said “State officials are immune from suit in federal court for claims arising under state law because ‘it is difficult to think of a greater intrusion on state sovereignty than when a federal court instructs state officials on how to conform their conduct to state law,'” meaning the plaintiffs would have had to prove that state officials’ conduct allegedly violates both the U.S. Constitution and state law to seek damage or relief.

The judge also said that plaintiffs’ lack of including a contract that SB 4C allegedly breaks and would therefore owe to Floridians to correct, such as “contractual obligations” concerning Disney’s bond debt, the court lacked jurisdiction and the counts were dismissed.

Disney has said the removal of its tax status in Florida could break the Reedy Creek Charter Agreement, which stipulates the state of Florida “will not limit or alter the rights of the District to own, acquire, construct, reconstruct, improve, maintain, operate or furnish the projects or to levy and collect the taxes, assessments, rentals, rates, fees, tolls, fares and other charges provided for in the Reedy Creek Act, and to fulfill the terms of any agreement made with the holders of any bonds or other obligations of the District.”

SB 4C does, by its legislative method, create changes to how Reedy Creek operates through dissolution of its status.

As far as plaintiffs’ claim that Disney’s First Amendment rights were violated, the court found that due to their lack of “close relationship” to the Walt Disney Company, they could not claim right of suit as a claim third-party standing, and could not prove they have “suffered an injury in fact” by the actions alleged.

The judge wrote that in this stage of the proceedings, the burden of proof was that of the plaintiffs, and they did not meet the requirements to prove their standing or cause, nor were they able to prove “concrete injury as a result of the alleged violation of Disney’s First Amendment rights.”

Further, the plaintiffs did not prove to the judge, in their filings, that they “have a close relationship with Disney,” and did not show that “Disney faces any hindrance in asserting its own First Amendment rights.”

Instead, Altonaga wrote that since plaintiffs allege that Disney and the State of Florida will be in litigation proceedings “for a significant period of time,” they are unable to prove Disney is unable to assert its free speech rights. Since SB 4C does not take effect until July 1, the effort to file what the judge called a “preenforcement” challenge did not meet the standards in court needed to argue the dissolution effort directly harms them.

Written simply, Judge Altonaga did not find that the three plaintiffs suing the state or its officials over the recent legislation had proven their grounds to sue. While closed, since the case was not dismissed with prejudice, it could be reopened at a later date, or in a different court jurisdiction.

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