Opinion ID: 59477
Heading Depth: 5
Heading Rank: 2

Heading: Lost investment

Text: Amigo also asserts that it produced sufficient evidence of its loss of $250,000, which constitutes the lost investment that Amigo spent to advertise and promote the El Chulo Show. With respect to such investment, Amigo is seeking reliance damages which reimburse one for expenditures made towards the execution of the contract in order to restore the status quo before the contract: Hart v. Moore, 952 S.W.2d 90, 97 (Tex.App.1997). Although not stated by Amigo's briefs, Amigo's evidence of lost investment presents an alternative theory of recovery  that is, Amigo can ultimately recover for its lost profits or its lost investment but not both. See Restatement (Second) of Contracts § 349 (1981) (As an alternative to [expectation damages], the injured party has a right to damages based on his reliance interest. . . . ). [14] Amigo presented sufficient evidence of its reliance damages. Brooks testified that Amigo spent approximately $250,000 in advertising the El Chulo Show. Further, Brooks's December 10, 2003, e-mail to Garza stated that Amigo's investment in the Show has been wasted since you [Garza] elected, with no warning, to stop showing up for work. Finally, Anderson testified that building an audience for a radio show requires a significant investment, and this investment is lost if the show and its performers can simply leave at will. [15] This evidence is sufficient for a reasonable jury to conclude that Amigo's promotional investment in the Show was approximately $250,000, was spent in reliance on Garza and Bernal performing the Show for Amigo during the term of their contractual agreements, and that promotional investment was in effect lost because of Garza and Bernal's early departure. Garza and Bernal, however, argue that Amigo's evidence was legally insufficient because Amigo did not present evidence that it was unable to recoup its promotional investment. Specifically, Garza and Bernal assert that the evidence shows that the El Chulo Show generated profits substantially in excess of $250,000, such that Amigo recouped its advertising investment. First, as explained above, Amigo introduced some evidence  albeit somewhat conclusory  that the promotional investment was wasted or lost as a result of Garza and Bernal's early departure. Second, it is the burden of Garza and Bernal, not Amigo, to show that Amigo received a benefit from its expenditures that reduce or offset the amount of reliance damages to which Amigo claims it is entitled. 22 Am.Jur.2d Damages § 51 (2003) (Recovery of reliance damages may be reduced to the extent that a breaching party can prove that a `deduction' is appropriate for any benefit that the claimant received for salvage or otherwise.) (emphasis added) (citing DPJ Co. Ltd. P'ship v. FDIC, 30 F.3d 247, 250 (1st Cir.1994)); cf. Restatement (Second) of Contracts § 349 ([T]he injured party has a right to damages based on his reliance interest . . . less any loss that the party in breach can prove with reasonable certainty the injured party would have suffered had the contract been performed.) (emphasis added). Even if it is undisputed that the El Chulo Show generated profits greater than $250,000, there is no evidence regarding what portion of those profits are attributable to Amigo's promotional investment. Thus, Amigo produced sufficient evidence of its reliance damages, and Garza and Bernal can introduce evidence at trial establishing that Amigo's promotional investment in the El Chulo Show generated substantial profits that reduce or completely offset the amount Amigo seeks in reliance. In conclusion, Amigo presented sufficient evidence that Garza and Bernal breached their Employment Agreements by resigning in November 2003. Further, Amigo produced sufficient evidence to allow it to pursue its lost profits or, in the alternative, its lost investment to compensate it for Garza and Bernal's breach. Thus, with respect to this claim for breach of contract, we REVERSE the judgment of the district court and REMAND for further proceedings consistent with this opinion.