On March 12, 2026, Sesame Workshop, the nonprofit behind Sesame Street, filed a federal lawsuit in Manhattan against United Parks & Resorts (SeaWorld’s parent company). The lawsuit seeks to immediately terminate their 45-year partnership and recover millions in unpaid royalties.
Core Allegations
The complaint describes SeaWorld’s recent behavior as a “unilateral retaliation campaign” that poses an “imminent threat” to the Sesame Street brand. Key claims include:
- Unpaid Royalties: Sesame Workshop alleges that SeaWorld stopped all royalty payments in September 2025. This follows a previous legal battle where a judge ordered SeaWorld to pay $11 million in late 2024—a payment SeaWorld reportedly delayed until October 2025.
- Operational Mishandling: The suit cites the abrupt shift of Sesame Place San Diego to seasonal operations and the permanent closure of a themed area in San Antonio as breaches of their 2017 agreement.
- Intellectual Property Abuse: SeaWorld is accused of using characters like Elmo and Big Bird in marketing materials without approval. The lawsuit even notes that some of these unapproved materials contained typos, which the Workshop argues tarnishes its reputation for educational quality.
- Retaliatory Pretext: SeaWorld allegedly claimed that Sesame Workshop “failed to invest in its own brand” as a reason to stop payments, an accusation the Workshop called “preposterous.”
Potential Impact on Theme Parks
If the court grants the termination, SeaWorld and Busch Gardens would lose the rights to use all Sesame Street intellectual property. This would affect several locations:
- Sesame Place (Philadelphia and San Diego): These standalone parks are entirely themed around the brand and might face rebranding or closure.
- SeaWorld Orlando & Busch Gardens Tampa: The “Sesame Street Land” attractions and parades at these parks would likely be removed or rethemed.
Official Responses
- Sesame Workshop: Stated they had “no choice” but to litigate to protect the trust families place in the brand.
- SeaWorld: A representative stated the company is aware of the filing and looks forward to “setting the record straight in court.”
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