I've been trying to find this out. I suspect it was dismissed because they lacked standing. Because there were a bunch of transfer, likely only the last seller has standing to sue for ignoring a deed restriction and of course they don't care.

That's not absolute. There can be other cases where you have standing even if you aren't involved in the transaction but those cases are limited.

Now it's also possible that the deed wasn't properly recorded. If it was, there might be more people who have standing, such as those near the project who are negatively impacted. It's possible that the district court erred or maybe the people bringing suit didn't live in the area or otherwise have standing.

It does seem wrong that you can effectively invalidate a deed restriction by simply selling it enough times.

Yeah, there's no point to deed restrictions if the average person doesn't have standing to do anything about them.