THE AUTHORS:
Zyad Loutfi, Élève-avocat at Quinn Emanuel Urquhart & Sullivan LLP
Adel Al Beldjilali-Bekkaïri, Trainee at Quinn Emanuel Urquhart & Sullivan LLP
Maleficent, a self-proclaimed ‘Mistress of All Evil’, is a powerful fairy living in the Moors, a magical forest realm bordering King Stefan’s human kingdom. In Disney’s recent retelling of her villainous role in the animated film Sleeping Beauty, we discover another twist to the tale, the history she shared with King Stefan, Princess Aurora’s father, and Maleficent’s true colors. Despite initially cursing the infant Princess during her christening to prick her finger on the spindle of a spinning wheel and die before the sun sets on Aurora’s sixteenth birthday, a curse which can only be broken by true love’s kiss, Maleficent has a change of heart. As Aurora bonds with her and starts regularly visiting the Moors, the Princess meets Philip, a prince from a neighboring kingdom, and both become mildly attracted to each other. During that time, Maleficent realizes that she does not have the heart to hurt Aurora and unsuccessfully attempts to undo the curse, forgetting she stated “no power on earth” can do so. The curse’s power beckons Aurora to the dungeon, where she pricks her finger and falls into a deep sleep. Hoping to save her, Prince Philip kisses the Princess but fails in resurrecting her. Tearful, hopeless, and in despair, Maleficent gently kisses Aurora’s forehead and unexpectedly wakes the Princess.
Paradoxically, as the reader will come to realize, this plot perfectly illustrates the scenario that occurred in Piccolo v. Disney where the latter ambitiously attempted to throw out a wrongful death case from Florida courts and compel arbitration based on arbitration agreements embedded in its streaming subscription terms. (See Jeffrey J. Piccolo (Personal Representative of the Estate of Tangsuan) vs. Great Irish Pubs Florida, Inc., Raglan Road Irish Pub and Restaurant and Walt Disney Parks and Resorts U.S., Inc., Circuit Court of the Ninth Judicial Circuit, Orange County, Florida, CASE NO.: 2024-CA-001616-O).
Background
Once upon a time, in Orange County, Florida, the Piccolos set out for a family dinner together. On October 5, 2023, they went to Raglan Road Irish Pub – a cozy restaurant nestled within the Disney Springs dining complex. However, what was meant to be a warm family outing in the Sunshine State soon spiralled into the family’s worst nightmare. Despite the Piccolos careful choice of a restaurant known for accommodating patrons with food allergies, Kanokporn Tangsuan, Jeffrey Piccolo’s wife and doctor at NYU Langone hospital in Manhattan, sadly became a victim of the staff’s unfortunate negligence and passed away after a severe allergic reaction.
Without delving into the heartbreaking details of the case, Tangsuan tragically passed away from anaphylaxis, caused by elevated levels of dairy and nuts in her system. Following this tragic event, in February 2024, Jeffrey Piccolo, on behalf of his late wife’s estate, filed a 19-page lawsuit in Orange County, Florida, against Raglan Road Irish Pub and Walt Disney Parks and Resorts U.S. Inc. (WDPR), the latter being brought into the law suit on grounds of having the right to control the former. The complaint details the family’s repeated conversations with their waiter about Tangsuan’s nut and dairy allergies. As alleged, this issue was raised by the family upfront, who inquired about the safety of specific menu items, and had the server confirm, multiple times, with the chef that they could be made allergen-free.
In this wrongful death lawsuit, Jeffrey Piccolo is accusing both companies of negligence for preparing Tangsuan’s food improperly and for failing to train their employees to guarantee food was made allergen-free as requested. He is seeking more than $50,000 in damages and trial by jury on all issues so triable.
Disney’s Maleficent-like Attempt to Compel Arbitration
Just like how Maleficent decided to curse the infant Princess Aurora without hesitation, WDPR decided to use one of its spells that it had cast on the Piccolos. Indeed, the plot took a different spin when, in late May, WDPR filed a motion asking the circuit court to throw away this wrongful death lawsuit and, instead, order Jeffrey Piccolo to arbitrate the case. A very bold move from the House of Mickey Mouse to defeat jurisdiction and stay proceedings. In asserting that the Estate of Kanokporn Tangsuan’s wrongful death claim must be submitted to arbitration, WDPR relies on three documents allegedly agreed to by Jeffrey Piccolo in his individual capacity.
Firstly, WDPR submits that Jeffrey Piccolo created a Disney account through its Disney Plus website in November 2019. By clicking ‘Agree & Continue’, WDPR claims that Jeffrey Piccolo agreed to Disney’s Subscriber Agreement which, in its Terms of Use, contains a binding arbitration clause. This clause – or first spell – reads as follows: “Any dispute between you and us, except for small claims, is subject to class action waiver and must be resolved by individual binding arbitration.”
Secondly, WDPR explains that the Subscriber Agreement states that “when you create a Disney+ or ESPN+ account, you also agree to the Walt Disney Company’s Terms of Use, available at www.disneytermsofuse.com and at the end of this agreement which governs your use of other Disney Services”. Furthermore, Disney notes that the ‘Terms of Use’ include an arbitration clause in Section 7 – titled “Binding Arbitration and Class Action Waiver” – which applies to “all disputes” including those involving “The Walt Disney Company or its affiliates”. Thus, given that WDPR is an affiliate of The Walt Disney Company, the binding arbitration clause – or second spell – should apply to Tangsuan’s Estate claim.
Finally, WDPR explains that, in September 2023, Jeffrey Piccolo also agreed to the ‘My Disney Experience Terms and Conditions’ and registered his late wife as his ‘guest’ when buying her a Disney EPCOT theme park ticket. A third, and final spell, that was cast on the Piccolos. These terms explain that “by using the Site/App or by clicking a box that states that you accept or agree to the My Disney Experience Terms and Conditions, you signify your agreement to these Terms for yourself and for all persons (including minors) for whom you are purchasing or otherwise securing benefits and/or managing those benefits and entitlements such as tickets […] You represent that you have all necessary rights and consents to agree to these Terms on behalf of your Party”. Therefore, WDPR argues that the Piccolo family is barred from suing in state courts and obliged to arbitrate their claims.
In a nutshell, WDPR relies on
- the Disney Plus Subscriber Agreement;
- the Disney Terms of Use (both of which Mr. Piccolo purportedly assented to while creating a Disney Plus free trial account in 2019 on his PlayStation), and finally
- the My Disney Experience Terms and Conditions in arguing that its terms amount to a valid and enforceable “clickwrap agreement” recognized by Florida courts. Accordingly, WDPR concludes that the Piccolos cannot credibly dispute that a valid arbitration agreement exists; one that is valid and enforceable under the Federal Arbitration Act (FAA).
Piccolo’s Ferocious Fight in the Florida Court
Just like in any Disney classic, the ‘Hero’ never goes down without a fight. Jeffrey Piccolo responded on August 2, 2024, in hopes of denying the Motion in its entirety, by firmly stating the WDPR’s argument are “fatally flawed”.
Piccolo explains that, under the FAA, courts must compel arbitration upon a showing that: “(1) a valid, written agreement to arbitrate exists; (2) an arbitrable issue exists; and (3) the right to arbitration has notbeen waived.” As an initial matter, Piccolo argues that WDPR has waived its alleged right to seek arbitration by filing its Answer without raising arbitration, in limine litis, as an affirmative defense and by participating in merits discovery – having submitted two separate Requests for Copies under Rule 1.351(e).
Moreover, Piccolo argues that, even if WDPR had not waived its rights, it is attempting to enforce an agreement that it never signed against a party who also never signed. According to Piccolo, the plaintiff in this wrongful death case is Jeffrey Piccolo, as Personal Representative of the Estate of Kanokporn Tangsuan, not Jeffrey Piccolo in his individual capacity. Therefore, it is not plausible that when Jeffrey Piccolo, individually, allegedly signed himself up for a free trial of Disney Plus back in 2019 on his PlayStation or bought tickets that he never used in 2023, he somehow bound the non-existent, and non-signatory Estate of Kanokporn Tangsuan to an arbitration agreement buried within certain terms and conditions.For Piccolo, Disney’s preposterous position is based on the “incredible argument that any person who signs up for a Disney+ account, even free trials that are not extended beyond the trial period, will have forever waived the right to a jury trial enjoyed by them and any future Estate to which they are associated, and will instead have agreed (on behalf of other survivors and the estate itself) to arbitrate any and all disputes against any and all Disney entities and affiliates, no matter how far removed from use of the Disney+ streaming service, including personal injury and wrongful death claims.” (See Plaintiff’s Response in Opposition to Disney’s Motion to Compel Arbitration, pages 4-6).
Regarding the rather ambitious claim that the Estate of Kanokporn Tangsuan’s wrongful death claim must be submitted to arbitration pursuant to the Disney Plus Subscriber Agreement, the Piccolos explicitly argue that there is simply no valid agreement to arbitrate any claims raised in this lawsuit. For the Piccolos, the Subscriber Agreement clearly indicates that Mr. Piccolo was only potentially agreeing to arbitrate claims concerning the Disney Plus streaming service. Therefore, the terms of the agreement, on its face, establish that there was no agreement to arbitrate ‘injury claims’ against other Disney entities.
As for the Disney Terms of Use, they submit that the arbitration provision therein is not valid because Jeffrey Piccolo had no actual or inquiry notice of the Disney Terms of Use. Accordingly, the latter constitute an unenforceable “browsewrap” agreement, as opposed to a “clickwrap agreement”, because it was not conspicuous enough to provide notice to consumers.
Furthermore, the Piccolos skillfully spotted that the provision in the ‘Disney Terms of Use’ is in conflict with the ‘My Disney Experience Terms and Conditions’ in a manner that renders it ambiguous. As their submission suggests, the former provides for arbitration of all disputes and requires the parties to submit to the jurisdiction of New York Courts while, in contrast, the latter does not contain an arbitration provision. Rather, it expressly contemplates that the parties may file lawsuits and requires those suits to be filed in Florida. Therefore, since the ‘My Disney Experience Terms and Conditions’ (which do not contain an arbitration clause) expressly “apply in addition to, and not in lieu of, the Disney Terms of Use”, the Piccolos argue that they have complied with those terms by filing suit in Orange County, Florida.
Finally, to fight WDPR’s claims and spells, the Piccolos fervently argued the inexistence of a valid arbitration agreement because the clauses upon which WDPR relies are simply ‘unconscionable’. According to Piccolo, the arbitration provisions that WDPR is seeking to enforce provide that arbitration will be administered by the JAMS Mediation, Arbitration and ADR Services in accordance with the JAMS Streamlined Arbitration Rules. The latter provides that the parties will only have 14 days to conduct discovery and Florida courts have held, in Prieto v. Healthcare and Retirement Corp. of America [919 So. 2d 531, 533 (Fla. 3d DCA 2005)], that an arbitration agreement which restricts access to discovery necessary to prove the plaintiff’s case was substantively unconscionable. Thus, this clause should be deemed invalid.
Disney’s Maleficent-like Change of Heart and the Piccolos Fairy Tale Ending
Everyone was eagerly anticipating the final battle scene, curious to see what other spells WDPR had in its arsenal but instead, an unexpected twist to the tale occurred. At first, Disney’s official statement was very blunt and explained that “[w]e are deeply saddened by the family’s loss and understand their grief. Given that this restaurant is neither owned nor operated by Disney, we are merely defending ourselves against the plaintiff’s attorney’s attempt to include us in their lawsuit against the restaurant.”
However, later in the litigation and in a Maleficent-like change of heart, Disney Experiences chairman Josh D’Amaro told BBC in an official statement that at Disney: “we strive to put humanity above all other considerations. With such unique circumstances as the ones in this case, we believe this situation warrants a sensitive approach to expedite a resolution for the family who have experienced such a painful loss. As such, we’ve decided to waive our right to arbitration and have the matter proceed in court.” In other terms, WDPR willingly decided to lift the curse and instead of continuing the fight, Disney channeled its inner Maleficent and decided that the matter can now be heard in court.
Unfortunately, in attempting to push the Piccolos claim into a confidential setting, WDPR succeeded only in creating the publicity and attention it likely wanted to avoid.
Commentary and Conclusion
Arbitration agreements are usually upheld and it is very uncommon for a party to withdraw its request for arbitration instead of letting a judge decide. Indeed, the FAA, codified at 9 U.S.C. §§ 1-16, protects the integrity of many arbitration agreements by deeming them valid, irrevocable, and enforceable.
This is not the first time a corporate giant relied on the fine print in its agreements that consumers generally ignore to change the course of a legal action against it. For instance, in Airbnb, Inc. v. Rice (138 Nev. Adv. Op. 65 (Sept. 29, 2022)), a wrongful death lawsuit was brought against Airbnb by the estate of a man who was killed at one of its rentals. The company pointed to the arbitration clause in the agreement the man had entered into when signing up for an Airbnb account, even though the deceased man had not rented the property where his death had occurred. This Nevada Supreme Court ruling in favor of Airbnb cited a unanimous 2018 ruling by the US Supreme Court, in Henry Schein, Inc. v. Archer & White Sales, Inc., which confirmed that, under the FAA, “a court has no power to determine the arbitrability of a dispute where the contract delegates the arbitrability question to an arbitrator, even if the argument that the arbitration agreement applies to the dispute is “wholly groundless”.
Although WDPR’s attempt to compel arbitration was a ‘bit of a stretch’ under the facts of the case, we wonder why did WDPR change stance and choose not to weaponize its subscribers terms. Indeed, we could have been in store for a precedent-setting case; one that would have seen a party compelled to arbitrate ‘any’ and ‘all’ disputes with its streaming service provider. In any case, the arbitration clauses that WDPR relied upon in their motion still exist on their various platforms which potentially put other people injured by Disney’s negligence at risk of facing a similar legal challenge. While the fate of this lawsuit now will be decided in a court of law, this case highlights corporate responsibility and accountability, particularly how companies handle disputes and the rights of individuals to seek justice through the courts. The Piccolos dispute also brought to fore consumer awareness regarding streaming services agreements, which many customers tend to overlook, and how subscribing them can potentially impact their rights.
Just like the reader, we remain very eager to see the outcome of the case and whether the Piccolos will emerge victorious. Disney must have decided that the harm they were suffering in the public eye was greater than the risk of swinging for the fences with its Motion to compel arbitration. After all, as its slogan suggests, Disney should be the place “Where Dreams Come True,” not a place where dreams come to unfortunately witness their demise.
In conclusion, for those less familiar with Disney’s classics, it’s important to note that in the 2014 live-action movie ‘Maleficent’ the character has a very different fate compared to the original 1959 ‘Sleeping Beauty’ animated film. In this new retelling, although she is initially defeated and captured after awakening the Princess, Maleficent does not die like before as she ultimately regains her power and is saved by Aurora. Whether the case ends in victory, defeat, or settlement, we’ll all have to wait for the final scene and the curtain to fall.
ABOUT THE AUTHORS
Zyad Loutfi is an élève-avocat at Quinn Emanuel Urquhart & Sullivan LLP (Paris office), where he focuses on international commercial arbitration and dispute settlement. He is admitted to practice in Egypt and in the State of New York. His expertise and scholarship span international arbitration, intellectual property law, and investment law, and his work involves advising and representing companies, states, and state-owned entities in a wide range of industries. He is admitted to practice in Egypt and in the State of New York and holds a Ph.D. in private law from the University of Paris City. He is also a graduate of Cornell Law School (where he was President of the Cornell International Arbitration Society), the University of Paris Descartes, the University of Paris-Est Créteil, and Cairo University.
Adel Al Beldjilali-Bekkaïri is a Trainee at Quinn Emanuel Urquhart & Sullivan LLP (Paris Office) international arbitration team where he focuses on commercial arbitration and dispute settlement. He holds a Master’s degree in International Arbitration and Trade Law (MACI) from the University of Saint-Quentin-en-Yvelines. He is also a graduate of the University of Algiers 1 and the University of Paris Saclay.
*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
