Opinion ID: 59477
Heading Depth: 2
Heading Rank: 2

Heading: Amigo's Tortious Interference With Contract Claim

Text: Amigo asserts that the district court erred in dismissing its tortious interference with contract claim against SBS for lack of sufficient evidence. To recover for tortious interference with contract, a plaintiff must prove: (1) that a contract subject to interference exists; (2) that the alleged act of interference was willful and intentional; (3) that the willful and intentional act proximately caused damage; and (4) that actual damage or loss occurred. ACS Investors, Inc. v. McLaughlin, 943 S.W.2d 426, 430 (Tex.1997). On appeal, Amigo only complains that SBS tortiously interfered with the Employment Agreements to the extent that SBS's actions caused Garza and Bernal to resign prior to the expiration of the Initial Term. As explained below, Amigo produced sufficient evidence of its tortious interference claim.
Because this tortious interference claim only complains about Garza and Bernal's untimely resignation, neither party disputes that the Employment Agreements were subject to inference until Garza and Bernal breached them by leaving Amigo. Amigo presented sufficient evidence that it knew of Garza and Bernal's intent to permanently cease performing the Show for Amigo and work for SBS on the morning of November 26, 2003. Thus, for the purpose of this appeal, the Employment Agreements were subject to interference until this time, and any acts taken by SBS after this time cannot be considered in evaluating Amigo's tortious interference claim.
To show tortious interference, a plaintiff is not required to prove intent to injure, but rather only that the actor desires to cause the consequences of his act, or that he believes that the consequences are substantially certain to result from it. Sw. Bell Tel. Co. v. John Carlo Tex., Inc., 843 S.W.2d 470, 472 (Tex.1992) (internal quotations omitted). Moreover, the interfering party must have actual knowledge of the contract or business relation in question, or knowledge of facts and circumstances that would lead a reasonable person to believe in the existence of the contract or business relationship. Steinmetz & Assocs., Inc. v. Crow, 700 S.W.2d 276, 277-78 (Tex.App.1985). Amigo contends that it produced sufficient evidence that SBS desired to cause Bernal and Garza to quit working for Amigo to work for SBS, and that this was substantially certain to happen given SBS's actions targeted at Bernal and Garza. Specifically, Amigo points to: (1) the Miami meeting between SBS, Hernandez, Garza, and Bernal and (2) SBS's communications and preparation of the SBS Employment Agreements after the Miami meeting.
First, Amigo produced sufficient evidence that Alarcon, SBS's President and Chairman of the Board, invited Hernandez, Garza, and Bernal to the Miami meeting for the purpose of discussing hiring Garza and Bernal to broadcast and syndicate the Show from Los Angeles for SBS. Specifically, Hernandez testified (by deposition summary): in late October/early November 2003, Alarcon contacted Hernandez in response to a proposal Hernandez had sent Alarcon earlier in the year regarding SBS becoming an affiliate of the Show, and Hernandez informed Alarcon that LEN was no longer syndicating the El Chulo Show; after this conversation, Alarcon contacted Hernandez a second time, and this time Alarcon was looking for a new show in Los Angeles and asked if Hernandez could walk him [Alarcon] through the process of how SBS could broadcast the El Chulo Show in Los Angeles at an SBS-owned station; Alarcon then invited Hernandez to visit his offices in Miami, Florida, and he [Hernandez] was made aware that Joaquin Garza and Raul Bernal were going to be present in that meeting as well; and that the purpose of the meeting was that SBS was looking for a morning show for Los Angeles and they wanted to understand how that show would fit in with their current business plan. Furthermore, Garza testified that he received a call from Alarcon in November 2003, during which Alarcon asked for us to go to his office in [Miami], to go to speak with him about the possibility of going back to Los Angeles. Finally, Brooks testified that when he confronted Garza about the Miami meeting shortly after it occurred, Garza told him that they had a meeting with Raul Alarcon, and they [Garza and Bernal] were being offered a job [by SBS]. (emphasis added). Second, Amigo offered sufficient evidence that SBS paid  at the very least  for the expenses Garza incurred for food and hotel in attending the Miami meeting. Garza testified that SBS paid for my hotel, for my food. Finally, Amigo offered sufficient evidence that  at the time of the Miami meeting  SBS knew, or should have known, that Garza and Bernal were under contract with Amigo. Hernandez testified that during his first phone conversation with Alarcon in late October/early November 2003, he informed Alarcon that Garza and Bernal were working for Amigo. Furthermore, Anderson testified that it was common in the radio industry for on-air talent to have employment contracts that bound the talent to a term of years. Even Cueva, SBS's in-house counsel, testified that radio stations have similar needs in preventing on-air talent from leaving and competing with their former employers. Viewed in the light most favorable to Amigo, SBS had actual knowledge of a business relationship between Garza, Bernal, and Amigo, and, because binding employment contracts were common in the radio industry for on-air talent, SBS had knowledge of facts and circumstances that would lead a reasonable person to believe in the existence of a contract between Garza, Bernal, and Amigo. Crow, 700 S.W.2d at 277-78; see also Top Value Enter., Inc., v. Carlson Mktg. Group, Inc., 703 S.W.2d 806, 810 (Tex.App.1986) (defendant knew or should have known of the existence of a contract because it was common knowledge in the industry that grocers operated under written license agreements). Given this evidence, a reasonable jury could conclude that SBS knew of Garza's and Bernal's Employment Agreements with Amigo and nonetheless set up the Miami meeting for the purpose of attracting Garza and Bernal to perform the El Chulo Show for SBS. Thus, Amigo presented sufficient evidence that SBS's actions regarding the Miami meeting constituted willful and intentional acts of interference. [22]
Amigo presented sufficient evidence that, after the Miami meeting, SBS had actual knowledge of Garza's and Bernal's Employment Agreements with Amigo and nonetheless continued to communicate with and negotiate to employ Garza and Bernal while they were still employed at Amigo. When Brooks learned about the Miami meeting, he asked Anderson to send SBS a letter asking SBS not to interfere with Garza's and Bernal's Employment Agreements with Amigo, which Anderson did on November 12. Thus, after November 12, it is undisputed that SBS definitively knew about Garza's and Bernal's Employment Agreements with Amigo. Given SBS's knowledge, Amigo presented sufficient evidence that on November 18, SBS began to draft employment agreements for Garza and Bernal. Plaintiffs Exhibit 25 shows a string of e-mails between Hernandez, Cueva, and Alarcon's secretary, Ivette Davidson, [23] which indicate that: Hernandez and SBS were in the process of preparing the SBS Employment Agreements for Garza and Bernal to work at SBS, and SBS requested Garza's and Bernal's Employment Agreements with Amigo to help the lawyer who is doing the new contracts. Cueva testified that he requested to see Garza's and Bernal's Employment Agreements with Amigo in order to determine if they existed and if they prevented SBS from employing Garza and Bernal. Upon receiving the agreements, Cueva evaluated them and, with the help of SBS's outside counsel determined that they did not prevent SBS from hiring Garza and Bernal. [24] Amigo then presented sufficient evidence that before Garza and Bernal left Amigo, SBS transmitted the SBS Employment Agreements to Hernandez, thereafter revised them in response to Hernandez's and Bernal's requests, and these agreements were significantly more lucrative than Garza's and Bernal's current Employment Agreements with Amigo. Cueva testified, and the evidence establishes, that on November 24  the day before Garza and Bernal stopped performing the Show  Cueva transmitted what appeared to be final drafts of the SBS Employment Agreements to Hernandez. [25] Furthermore, Cueva testified, and the evidence establishes, that on November 25, SBS revised the SBS Employment Agreements to accommodate for changes that were discussed between Hernandez and Bernal. Finally, Cueva testified that the drafts of the SBS Employment Agreements offered Garza and Bernal $300,000 and $100,000 per year, respectively, for a term of five years, amongst other bonuses. These terms were significantly more attractive to Garza and Bernal than their current agreements with Amigo. Given this evidence, a reasonable jury could conclude that although SBS definitively knew that Garza and Bernal were under contract with Amigo, SBS continued to communicate with and negotiate with them  through Hernandez  in an attempt to lure them away from Amigo. Thus, despite the fact that Garza and Bernal did not sign any employment agreements with SBS until after they left Amigo, Amigo presented sufficient evidence that SBS's actions after the Miami meeting constituted willful and intentional acts of interference. [26]
To establish proximate cause, a party must show that the defendant took an active part in persuading a party to a contract to breach it. Davis v. HydPro, Inc., 839 S.W.2d 137, 139 (Tex.App.1992) (emphasis omitted). Merely entering into a contract with a party with the knowledge of that party's contractual obligations to someone else is not the same as inducing a breach. Id. Amigo presented sufficient evidence that SBS committed numerous acts of interference for the purpose of employing Garza and Bernal, as discussed in Section III.B.2 supra, and these acts were successful in persuading Garza and Bernal to leave Amigo. First, SBS knew the terms of Garza's and Bernal's contracts with Amigo and offered them higher salaries and bonuses. Second, Garza and Bernal knew of the SBS Employment Agreements and their terms before they left Amigo. Specifically, SBS transmitted final drafts of employment agreements to Hernandez on November 24, 2003, the day before Garza and Bernal stopped performing the Show, and revised those agreements on November 25, the day before Garza and Bernal definitively informed Amigo that it would no longer be performing the Show. Finally, Garza's and Bernal's statements to Amigo indicated that their decision to leave Amigo was directly due to SBS's offer of employment. Brooks testified that on November 26, Bernal informed him that he and Garza had accepted positions with SBS in Los Angeles, and Garza thereafter told him via phone that he did not need Amigo any more. Thus, Amigo produced sufficient evidence of proximate causation. See Top Value Enters., Inc., 703 S.W.2d at 811 (finding sufficient evidence of proximate causation where the defendant made an active presentation and topped the terms of plaintiffs previous contracts, resulting in a successful offer).
As discussed in Section III.A.1.b supra, Amigo produced sufficient evidence of the fact and amount of damages that resulted from the loss of the Show  that is, Amigo produced sufficient evidence of its lost profits and lost investment. Thus, Amigo can pursue these two alternate theories of damages on remand. Furthermore, Amigo produced sufficient evidence  in the form of a profit and loss statement prepared by SBS  that SBS made $394,407.15 in profit from airing the El Chulo Show on SBS. In the event the jury cannot readily ascertain the amount of lost profit Amigo sustained from the loss of the Show, Amigo can seek to recover the amount SBS was unjustly enriched by its actions. See Sandare Chem. Co., 820 S.W.2d at 24 ([I]n a case of tortious interference with contractual relations, evidence of the defendant's profits may, when the plaintiff cannot show with certainty the profits it would have realized in the' absence of the interference, constitute evidence of the plaintiffs lost profits.). Thus, with respect to Amigo's claim for tortious interference with contract, we REVERSE the judgment of the district court and REMAND for further proceedings consistent with this opinion.