Gimbel v. Signal Companies, Inc.

Signal Companies (defendant), once a pure oil business, had grown into a diversified conglomerate that routinely acquired and disposed of corporate branches; its board approved selling its wholly owned subsidiary, Signal Oil, to Burmah Oil, even though Signal Oil represented 26 percent of Signal's total assets, 41 percent of its net worth, but only 15 percent of its revenues and earnings. Shareholder Louis Gimbel (plaintiff) sought a preliminary injunction, arguing the sale required majority shareholder approval as a sale of all or substantially all of Signal's assets.