Disney Braces for Battle

Heading into next week's annual meeting, Disney (NYSE: DIS  ) executives have to be chewing their mouse mittens to the bone. What started as a modest "Save Disney" movement to oust CEO Michael Eisner and a handful of directors by former board members Roy E. Disney and Stanley Gold has gained momentum -- and girth.

The grassroots campaign has been impressive, riling up the individual investor with a passion for animated cel art and defunct park attractions. Still, you rarely accomplish much holding an odd lot of shares. Granted, that's an exaggeration, but Roy and Stan clearly need the institutional investors to put an end to the Eisner era.

It just might happen. Last night, the California Public Employees' Retirement System (calPERS) announced that it would withhold its vote for Eisner next week. As the nation's largest pension with $165 billion in managed assets, CalPERS has been known to throw its weight around when needed. Back in December it even went after the NYSE.

While CalPERS controls just 0.5% of Disney's outstanding shares, it's got a voice that gets heard. And it's singing. "We have lost complete confidence in Mr. Eisner's strategic vision and leadership in creating shareholder value in the company," the pension said in a biting press release.

This does not mean that Eisner's run will end at next week's meeting in Philadelphia. However, while he's in town, he might take a moment to follow Rocky Balboa's tracks up the steps of Philly's Museum of Art. He's got a real fight on his hands, and the dissidents are gaining strength.

And rightly so. Having so recently been ditched by Pixar (Nasdaq: PIXR  ) only to be insulted by a weak buyout offer from Comcast (Nasdaq: CMCSA  ) , Disney has a lot to prove. Eisner can point to recent stock gains, but Disney still trades for less than it did three, four, and even five years ago.

Can you hear it? Dumbo, Peter Pan, and Tinkerbell are belting out "Gonna Fly Now." Can Eisner make it a quartet in Philadelphia?

How do you think things will go down in Philadelphia next week? Is it time for Eisner to go or does he deserve a chance to see his company through? Why exactly is Disney meeting in Philly anyway? All this and more -- in the Disney discussion board. Only on Fool.com.

Longtime Fool contributor Rick Munarriz owns shares in Pixar and Disney. He was psyched to see Pixar singled out as a recommended stock in Motley Fool Stock Advisor and looks forward to the day when Disney will be worthy.