Disney beats shareholder lawsuit over feud with Florida Governor DeSantis
A Delaware judge ruled that the Walt Disney Co board did not act negligently, dismissing a case brought by shareholder Kenneth Simeone.
A Delaware judge ruled on Tuesday that the Walt Disney Co board did not act negligently when it criticised a sexual identity bill signed by Florida Governor Ron DeSantis.
The case was brought to court by shareholder Kenneth Simeone, who sued Disney in December and sought internal records, including board members' emails, to investigate possible wrongdoing by directors.
However, the judge, Lori Will, stated that the case was improperly directed by a conservative legal group and that Simeone could not use a provision of Delaware corporate law meant to empower shareholders to investigate boardroom wrongdoing to “search for hypothetical conflicts.”
While the judge acknowledged that Disney's criticism of the 2022 law, known as the "don't say gay" law, might have been a bad business decision, the evidence at trial showed that directors did not allow their personal views to dictate the company's response to the bill. The ruling means that Disney will not be required to hand over the requested internal records.
The dispute between Disney and Governor DeSantis escalated when the company's criticism led to the state removing Disney's control of a special administrative district related to the Walt Disney World resort. Governor DeSantis, who is seeking the Republican presidential nomination, has used the conflict with Disney to raise his national profile, referring to it as a battle against what he calls "woke Disney."
In addition to ruling in favour of Disney, Judge Will also found that the lawsuit appeared to have been brought to benefit the Thomas More Society, a non-profit law firm known for championing conservative causes, which was covering Simeone's legal costs. The judge emphasised that a corporate records lawsuit should not be used as a platform to advance personal beliefs. Will wrote, "The plaintiff’s counsel and the Thomas More Society are entitled to their beliefs," and added that a corporate records lawsuit "is not a vehicle to advance them."
As of now, there has been no immediate response from Simeone, his lawyer, Paul Jonna, or Disney regarding the ruling.
(With inputs from Reuters)
Catch all the Business News , Corporate news , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
Business NewsCompaniesDisney beats shareholder lawsuit over feud with Florida Governor DeSantis
First Published:28 Jun 2023, 06:52 AM IST
- Top Gainers
- Top Losers
- 52 Week High