HOLLYWOOD — Spanish Broadcasting System (SBS) has reached an agreement with Mexican media company Grupo Radio Centro that settles a 23-month lawsuit alleging tortious interference and unfair competition.
In February 2016, GRC was hit with a multi-million dollar lawsuit filed by SBS — a move made after Grupo hired an on-air radio personality for the station it manages in Los Angeles, KXOS-FM 93.9, from SBS’s KLAX-FM 97.9. Both stations target the Southland’s regional Mexican listening audience.
While that hire triggered legal action, it was the 11th instance where an SBS employee had gone to work at KXOS.
In response to the lawsuit, GRC in April 2016 said SBS failed to prove KXOS management raided KLAX staff. It asked a California court to dismiss the case, but that ultimately failed.
The settlement, the terms of which cannot be disclosed as they are protected by a confidentiality provision, was reached in advance of the upcoming trial.
SBS noted in a statement issued Friday afternoon that the settlement resolves all pending legal proceedings between the parties.
“We are extremely pleased to have amicably resolved the matter,” said SBS General Counsel Richard Lara. “As has always been its practice, SBS will not hesitate to take legal action when necessary to defend its contractual rights and business interests.”
At issue was the level of proprietary information GRC obtained from the former SBS employees, court filings examined by RBR+TVBR show.
With competitive bravado, Grupo Radio Centro said in April 2016, “In a highly competitive field, word gets out quickly when an employee can better their salary, their benefits and have a generally nicer place to work.”
KXOS-FM “Radio Centro” is the home of high-profile morning host Richardo “El Mandril” Sanchez, who exited KLAX in January 2014, immediately after his contract with SBS ended. The hiring followed that of morning show host Martin Romero Hernandez, known as “El Raton.” Romero had four years left on his contract at KLAX when he accepted an offer from Grupo Radio. SBS argued that GRC did so knowing of El Raton’s contractual obligations to SBS subsidiaries in Florida and California.
At the executive level, one of the most successful poaches was former SBS California VP Corporate Sales Bill Shadorf, who “abruptly and unexpectedly resigned from SBS” in 2015 and joined GRC “with an axe to grind,” according to the complaint.
— Archival reporting by Carl Marcucci and Adrian Zupp