It’s been a tough year for The Walt Disney Company as they navigate the political waters of Florida, trading lawsuits with Governor Ron DeSantis over changes to the local region. Now, the legal team for the theme park and entertainment giant is working through a new suit that was filed in California on May 12th that brings back some not-long-forgotten names of the ex-executive team. The plaintiff, Local 272 Labor-Management Pension Fund, claims that The Walt Disney Company repeatedly misled investors about the financial stability of the streaming service Disney+.
The securities class action specifically names some familiar faces alongside the broader target of The Walt Disney Company, including former CEO Robert Chapek, Kareem Daniel, and Christine M McCarthy. The suit claims the defendants “repeatedly misled investors about the success of the Disney+ platform by concealing the true costs of the platform, concealing the expense and difficulty of maintaining robust Disney+ subscriber growth, and claiming that the platform was on track to achieve profitability,” says Bloomberg Law.
Ex-CEO, Robert Chapek, was infamously ousted from the company in a takeover in 2022 when the board reappointed former CEO Robert Iger to the top seat. Chapek is directly named in the lawsuit, which claims his reorganization of the company “represented a dramatic departure from Disney’s historical reporting structure,” shifting power from the creative teams over to his new right hand, Kareem Daniel, also named in the lawsuit.
The proposed class action seeks ‘“damages and injunctive relief on its securities fraud claims,” says Bloomberg Law. The complaint estimates that the action could potentially include thousands of members if it were to progress in a move that comes just days after the latest Disney earning figures were released. The Walt Disney Company has been in damage control for the better part of 2023, making big changes to the company’s structure and focus. Among the changes were thousands of jobs that have been cut to recover from substantial revenue losses caused by its commitment to content under Robert Chapek.
More to come.
Zoë Wood is a travel writer from Sydney, Australia. Since her first visit to Disneyland at the age of 6, she has spent her years frequently visiting Disney Parks and traveling around the world.
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