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Imperial had been purchased by P and D with each getting 50% ownership. Sales revenues for the 10 months ending July 31, 1982, were approximating $ 2 million. P sued for dissolution of Imperial based on the dissension and corporate deadlock between himself, a 50% shareholder, and Ds, the other 50% shareholders. Ds filed a counterclaim alleging breach of fiduciary duties and sought damages. Ds filed a motion for a temporary restraining order regarding the day-to-day operations of Imperial and for appointment of a receiver. The trial court entered an order that enjoined the parties from interfering with each other in the business operation, entitled the parties to access to business records, required all checks to be signed by a P and Ds, and made procedures for handling the mail. Two months later, P and his wife, Barbara, resigned from Imperial as officers and directors and almost immediately hired everyone at Imperial to work in their new company. The following day they purchased a new agency and began competing with Imperial. In the following weeks, P has solicited customers of Imperial and has secured enough of Imperial's commercial customers to have a significant negative impact on Imperial's sales and profitability now and within the immediate future. Ds moved for a preliminary injunction to stop P from competing with Imperial. The court entered a preliminary injunction that ordered P to deliver an irrevocable voting proxy of his stock and barred him from personally soliciting travel business from Imperial for one year. The court tried P's complaint for dissolution and Ds' complaint for damages for breach of fiduciary duty. It ruled that P failed to prove his case and found in favor of Ds on their complaint for breach of fiduciary duty. It then held that damages were too inexact to be determined and therefore fashioned an equitable remedy, ordering P to transfer his Imperial stock to Imperial to be held in constructive trust as treasury stock and voted on by Ds. P was also ordered to pay court costs. Both parties appealed.

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