Disney Settles $5 Million Annual Pass Lawsuit

Magic Key Lawsuit Settled

In January 2021, while Disneyland Resort was closed because of the pandemic, Disneyland Annual Passholders were sent an email informing them that Disney was “sunsetting” its popular Annual Passholder Program. The hundreds of thousands of people who had Disneyland Annual Passes were devastated, but Disney promised a new program would be taking its place. Eight months later, the Magic Key Pass Program was introduced. It was nearly identical to the Annual Pass program. Guests were able to purchase one of four Magic Keys — the Dream Key, the Believe Key, the Inspire Key, and the Enchant Key.

Disneyland Magic Key Pass

Credit: Disney

While similar to the original Annual Pass Program, there were some significant differences. Guests visiting Disneyland Resort were, and still are, required to make theme park reservations before visiting. Each Magic Key has a number of reservations that the Key Holder can make in advance, with more expensive Magic Keys allowing for more reservations. Theme park reservations have always been controversial and, just one year later, those reservations led one Magic Key Holder to file a $5 million lawsuit against the House of Mouse.

magic key holders ruin disney experience

Credit: Disney

The Magic Key Holder — identified as Janale Nielsen — had purchased a Dream Key, which, at the time, cost $1,300. The Dream Key claimed to have no blackout dates. However, because there were only a set amount of theme park reservations available each day for Magic Key Holders, Disney was creating artificial blackout dates. Not long after Magic Keys went on sale, purchasers complained that reservations were booked up for weeks at a time.

Disney attempted to get the lawsuit thrown out, but a judge denied their motion and the case was allowed to move forward. Nielsen filed the case on behalf of herself and any other Magic Key Holder who wanted to join it.

Disneyland Resident Discount 100th Anniversary

Credit: Disney

Now, we have learned that, after in-person mediation, the lawsuit has been settled. Per the federal court filings, the parties have agreed that they will come to a final agreement by August 31. After that date, more details will be released on the exact terms.

All other hearings in the case have been adjourned sin die, which means that there are no scheduled dates for them to be resumed.

Disneyland California Adventure

Credit: Disney

Because of the lawsuit, Disney has changed the terms and conditions that Guests agree to when they purchase a Magic Key. Guests agree to settle things with binding arbitration. The Guest also waives the right to file a lawsuit or have their case heard by a jury. Disney also no longer sells the Dream Key. The top-tier Magic Key is now called the Inspire Key.

About Krysten Swensen

A born and bred New England girl living the Disney life in Southern California. I love to read, to watch The Golden Girls, and love everything to do with Disney and Universal. I also love to share daily doses of Disney on my Disney Instagram @BrazzleDazzleDisney!

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