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A jury in Travis County recently returned a unanimous verdict against the majority shareholder of one of Texas’s largest privately held waste management companies. The combined damages, which spanned claims for breach of fiduciary duty, unjust enrichment, breach of contract, and exemplary damages, likely exceed $100 million. The jury also found that the controlling shareholder abused his authority with intent to harm and that corporate property was being misapplied and wasted—findings that satisfy the statutory prerequisites for a rehabilitative receivership.

The case should unsettle every controlling shareholder in Texas who has structured transactions through entities they personally own, inflated their own compensation while withholding distributions, or who believes that majority ownership means 100% impunity.

What Bobby Gregory Did

Bobby and Jimmy Gregory co-founded Texas Disposal Systems in 1977 as equal partners. In 1984, Bobby persuaded Jimmy to reduce his ownership from 50% to 20%, in exchange for a written agreement (the “Letter of Understanding”) providing that decisions on salaries, dividends, bonuses, and strategic shifts in business would still require both brothers’ consent.

For decades, the arrangement worked as planned. Then it didn’t. Around 2019, Jimmy began estate planning, and in the process, provided certain financial information from the company to his lawyer and an appraiser, who agreed to keep the information confidential. Bobby accused Jimmy of improperly disclosing company financial information and subsequently cut off Jimmy’s access to the company’s finances, refused to pay distributions, increased his own salary from $300,000 to roughly $2,000,000, fired Jimmy and his children, removed Jimmy from all governance positions, and installed his wife, his son, and the company’s in-house lawyer as the new board.

More consequentially, Bobby created a series of solely owned companies and began routing corporate business through them. One purchased vehicles and leased them back to the TDS Companies at a profit. Another took over the companies’ payroll and employee benefit functions for a fee. A third purchased an entire business division, the scrap iron and metal operation, at a price Bobby set himself, without any independent valuation. Shared administrative costs were allocated in a way that favored Bobby’s entities over the companies Jimmy co-owned.

What the Jury Did

The jury found breach of fiduciary duty on every self-dealing transaction, awarded approximately $86 million in past and future damages on the vehicle leasing scheme alone, found Bobby unjustly enriched by over $23.7 million across the various schemes, and—unanimously, by clear and convincing evidence—found that each act of self-dealing was committed with malice. It then assessed exemplary damages in the exact amount of Bobby’s unjust enrichment: another $23.7 million.

The jury also found that the Letter of Understanding was a binding contract, that Bobby breached it, and that his defenses of superseding agreement and waiver both failed. It awarded Jimmy his proportional share of the salary increases Bobby gave himself without Jimmy’s consent, plus the distributions Bobby terminated.

Why This Should Matter to Controlling Shareholders

Legal scholars have long observed that self-dealing, construed broadly, is at the heart of all shareholder oppression disputes. See, e.g., Robert A. Ragazzo, Toward a Delaware Common Law of Closely Held Corporations, 77 Wash. U. L.Q. 1099, 1146 (1999). This verdict proves the point. Every scheme Bobby Gregory used to enrich himself at his brother’s expense was a self-dealing transaction, and the jury punished each one.

The practical takeaway for controlling shareholders is straightforward: if you personally benefit from transactions between yourself and your company, each one of those deals can become a separate claim against you in an oppression lawsuit. Bobby Gregory had at least five such arrangements. The jury found breach on all of them.

What transforms ordinary fiduciary duty exposure into a catastrophic verdict is the malice finding. When a jury concludes that self-dealing was designed to freeze out a co-owner, rather than serve a legitimate business purpose, it does not just compensate—it punishes. This jury tied exemplary damages to the exact dollar amount of Bobby’s unjust enrichment, effectively requiring him to pay back everything twice. In practical terms, exemplary damages in this context function as the oppression remedy Texas statutes lack.

And the exposure does not end with damages. The jury’s findings on abuse of authority, intent to harm, and misapplication of corporate property satisfy the statutory prerequisites for a rehabilitative receivership under section 11.404 of the Texas Business Organizations Code. Gregory does not just face a money judgment; he faces the prospect of a court-appointed receiver overseeing the company he spent decades building.

The Arithmetic of Fairness

The irony of this case is how cheaply it could have been avoided. Bobby Gregory owned 80% of a company worth hundreds of millions of dollars. Had he continued paying proportional distributions to a 20% owner, as the brothers’ agreement required, his annual cost would have been a manageable fraction of the companies’ profits. Instead, he faces a verdict that dwarfs what fairness would have cost him, plus the potential loss of operational control to a receiver.

Consider this a warning. If you are a controlling shareholder in a Texas closely held company, look at your corporate arrangements. Identify every transaction between the company and any entity you personally own. Ask whether each one would look like a legitimate business decision to twelve strangers—or like a scheme to divert money from your co-owners to yourself. If the answer is the latter, this verdict tells you exactly what a Texas jury thinks that is worth.