I also want to mention that I used the REDINEBLOCK and this doesn't seem to change the background color or text style, unless there is another step that needs to be performed.
Thanks

Pat,
Layers and Text Styles get defined in the drawing just like blocks, so the only way to change those items is either manually, or to PRG them from the drawing so they can get defined new upon insertion. Since your callouts are using the same layers and text styles, CAD is keeping those as first defined so it can speed up its performance.

I would try deleting all labels, purging the drawing fully by typing "PRG" into the commandline, then try to place the new label style.

Here is a good article that goes deep into Text style troubleshooting:
Customizing Text Styles: Font, Size, or Other Settings Coming in Incorrectly

Here is a good refresher webinar that goes into layers and blocks in CAD:
CAD Basics: Getting To Know Blocks And Layers

If you have further questions feel free to shoot us a Tech Support ticket and we can go from there.