## Facts

- Fortress Systems, L.L.C., a Nebraska manufacturer of nutritional supplements, sought financing to build its own production facility.
- Fortress pursued a multi-million-dollar loan from Bank of the West; the parties exchanged a commitment letter and discussed conditions and a closing date.
- Bank representatives allegedly stated that the loan would close once a pending shareholder lawsuit (the Broderick litigation) was resolved and Fortress satisfied the Bank’s requirements.
- While the lawsuit remained pending, the Bank continued to request updated financial and other information from Fortress.
- In reliance on the Bank’s alleged assurances, Fortress worked toward resolving the shareholder dispute, entered a construction contract, and spent its own funds on construction and related preparations.
- The Bank ultimately refused to fund the loan, citing concerns tied to the shareholder litigation and its disclosure.
- Fortress sued asserting breach of contract, promissory estoppel, and breach of the duty of good faith and fair dealing; the court granted summary judgment for the Bank on the contract and good-faith claims, leaving promissory estoppel for trial.
- A jury returned special findings supporting Fortress’s promissory estoppel theory; the court then determined the proper measure of damages and entered judgment for Fortress on that claim.

## Issues

1. Whether the Bank made a clear and definite promise that the loan would close if Fortress settled the shareholder litigation and met the Bank’s conditions.
2. Whether Fortress’s settlement efforts and construction-related expenditures were reasonable, foreseeable, and detrimental reliance sufficient to support promissory estoppel.
3. Whether promissory estoppel could support recovery despite statute-of-frauds objections to enforcing an oral loan promise.
4. What damages measure applies for promissory estoppel where no enforceable loan contract exists.

## Decision

- The court held that the jury’s findings established a clear promise by the Bank to close the loan upon resolution of the shareholder lawsuit and satisfaction of stated conditions.
- The court found Fortress reasonably and foreseeably relied on that promise by pursuing settlement, committing to construction, and expending funds in preparation for the financed project.
- The court concluded that promissory estoppel provided an equitable basis for enforcing the promise to the extent necessary to avoid injustice, notwithstanding statute-of-frauds arguments.
- The court entered judgment for Fortress on promissory estoppel and awarded damages limited to losses directly caused by Fortress’s reasonable reliance, not the full benefit of an unfunded loan.

## Legal Principles

- Promissory estoppel requires a clear promise that the promisor should reasonably expect to induce action or forbearance, actual reasonable reliance, and resulting detriment such that enforcement is necessary to avoid injustice.
- Promissory estoppel is an equitable remedy; where applicable, it may allow relief even when an asserted agreement would be unenforceable as a contract.
- Promissory-estoppel damages are generally reliance-based: recovery is limited to losses proximately caused by the promise and the plaintiff’s reasonable reliance, rather than expectancy or “benefit-of-the-bargain” damages.

## Conclusion

The court enforced the Bank’s alleged loan commitment under promissory estoppel based on the jury’s findings of a clear promise and foreseeable, detrimental reliance, and it awarded reliance-based damages tied to the costs Fortress incurred in acting on the promised financing.


Fortress Sys., L.L.C. v. Bank of the W., No. 8:06CV283, 2008 WL 64690 (D. Neb. Jan. 4, 2008)