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Radio Hosts Breached Contracts, Court Rules

NEW ORLEANS (CN) - The 5th Circuit ruled against Joaquin Garza and Raul Bernal, radio personalities for the "widely successful" Hispanic radio show "El Chulo y La Bola," who ditched their employment contracts with Amigo Broadcasting LP and went to work for Spanish Broadcasting System in Los Angeles.

SBS allegedly lured Garza and Bernal away from their popular show in Austin, Texas, by promising yearly salaries of $300,000 for Garza and $100,000 for Bernal, among other bonuses. The deal was "significantly more attractive" than what Amigo had offered.

As a result, Garza and Bernal effectively resigned in November 2003 when they stopped showing up for work. Garza allegedly told Amigo's then-president Chuck Brooks that the radio duo did not need him anymore, said "fuck you," and hung up the phone.

Amigo claimed Garza and Bernal cost it $721,000 in lost profits, including a drop in advertising revenue from $350,000 in 2003 to $11,000 in 2004, when the "El Chulo" show was no longer on the air.

The appeals court ruled that Garza and Bernal had breached their employment contracts with Amigo and had also breached their licensing agreements by letting SBS use their names and likeness while their licenses with Amigo were still in effect. But the court said Amigo could not recover damages from the breach of license, because the alleged damages resulted from defendants' resignation, not their breach of license.

The court also held that SBS should have known Garza and Bernal had employment agreements with Amigo "because binding contracts were common in the radio industry for on-air talent."

Finally, the judges ruled that Amigo had not withdrawn its misappropriation and unfair competition claims.

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