PRECEDENTIAL

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT

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Nos. 19-3847 & 19-3892

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DANSKO HOLDINGS, INC.,

Appellant in No. 19-3892

v.

BENEFIT TRUST CO.,

Appellant in No. 19-3847

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On Appeal from the United States District Court 

for the Eastern District of Pennsylvania

(D.C. No. 2-16-cv-00324)

District Judge: Hon. Jan E. DuBois

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Argued: November 16, 2020

Before: AMBRO, BIBAS, and ROTH, Circuit Judges

(Filed: March 16, 2021)

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2

Richard N. Bien [ARGUED]

J. Bradley Leitch

Lathrop GPM

2345 Grand Boulevard, Suite 2200

Kansas City, MO 64108

Joshua Bachrach

Wilson Elser Moskowitz Edelman & Dicker LLP

2001 Market Street,

Two Commerce Square, Suite 3100

Philadelphia, PA 19103

Counsel for Appellant in No. 19-3847

Robert W. Hayes [ARGUED]

Cozen O’Connor

1650 Market Street, Suite 2800

Philadelphia, PA 19103

Counsel for Appellee in No. 19-3847

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OPINION OF THE COURT

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BIBAS, Circuit Judge. 

A shoe company hired a trust company as trustee for its 

employees’ stock ownership plan. After that, the trustee hinted 

that it would help the shoemaker refinance its debt, but then 

backed out of that deal. The shoemaker sued the trustee. The 

trustee counterclaimed for the cost of defending the suit. On 
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summary judgment, the District Court rejected both parties’

claims.

We will vacate and remand. The court erred in rejecting the 

shoe company’s contract, estoppel, and fraud claims. But under 

the trust agreement, the shoe company must advance the trustee’s reasonable litigation expenses.

I. BACKGROUND

A. Dansko and Benefit’s falling out

Dansko Holdings, a maker of shoes, offers its employees a 

stock ownership plan. In 2011, it hired Reliance Trust Company as the plan’s trustee. Dansko and Reliance signed a trust 

agreement. 

In 2014, Dansko considered replacing Reliance with Benefit Trust Company. During its due diligence, it asked Benefit 

whether it had recently been investigated by the Department of 

Labor. Benefit had been, but falsely denied it.

Dansko hired Benefit. In June 2014, Dansko’s board passed 

a resolution “appoint[ing]” Benefit as the new trustee. App. 

396–97. The resolution added that Benefit would be “substituted for Reliance Trust Company in the Trust Agreement.” 

App. 396. About two weeks later, Benefit “accepted its appointment.” App. 399.

Around that time, Dansko decided to refinance its debt. It 

needed a trustee’s help with that and raised the issue a few 

times with Benefit over the next six months. Benefit never 

agreed in writing to do this work. But it allegedly said it would 
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“be able to do the [deal]” and estimated that it would need a 

month or more to do due diligence for the trust. App. 2 (emphasis added). So Dansko thought Benefit would be the trustee 

for the deal.

But Benefit backed out. In December 2014, it told Dansko 

that it would not serve as trustee for the debt deal. That caught 

Dansko off guard and delayed the deal. The delay allegedly 

cost Dansko more than $2 million in extra interest. 

B. District court proceedings

Dansko sued Benefit, making three claims relevant here: 

First, Benefit breached the trust agreement, which required it 

to help with the deal. Second, when Benefit hinted that it would 

help with the deal, it made an implied promise that is now enforceable by promissory estoppel. And third, Benefit fraudulently induced Dansko to hire it by falsely denying the Department of Labor’s investigation. Benefit counterclaimed for its 

defense costs under an indemnification clause in the trust 

agreement.

After discovery, the District Court granted summary judgment. It rejected Dansko’s claims but held that Dansko did not 

have to indemnify Benefit for its defense costs. Dansko Holdings, Inc. v. Benefit Trust Co., 418 F. Supp. 3d 100, 105–12 

(E.D. Pa. 2019).

Both sides now appeal. As the parties agree, Pennsylvania 

law governs this case. Sitting in diversity, we must predict how 

the Supreme Court of Pennsylvania would resolve each issue.
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II. DANSKO’S CONTRACT CLAIM SURVIVES

First, Dansko claims that Benefit must help with the debt 

deal under the trust agreement. The District Court thought that 

Dansko had waived this claim in its summary-judgment brief. 

But we read its brief as preserving that claim. Alternatively, 

Benefit asks us to hold the claim barred by federal and Pennsylvania law. But those arguments fail too.

A. Dansko did not waive its contract claim

Throughout this case, Dansko has pressed its contract 

claim. It first raised this claim in its complaint, alleging that 

Benefit both “breached the express terms of the Trust Agreement” and “breached the implied duty of good faith and fair 

dealing.” App. 46–47. Dansko repeated the second contract 

theory in its summary-judgment brief, narrowing its position 

by pressing “only ... its claim for breach of the duty of good 

faith and fair dealing.” Supp. App. 47. It claimed that although 

the contract did not expressly address Benefit’s obligation to 

help with a refinancing, that duty came within the contract’s 

broad purpose.

The District Court thought that by pressing “only” the 

good-faith theory, “Dansko withdrew its breach of contract 

claim.” 418 F. Supp. 3d at 106. We disagree. Dansko’s goodfaith theory was not an alternative to the contract claim, but a 

version of the claim. Under Pennsylvania law, a good-faith 

claim is a type of contract claim. Burton v. Teleflex Inc., 707 

F.3d 417, 432 (3d Cir. 2013). By relying “only” on a good-faith 

theory for its contract claim, Dansko abandoned its first theory 
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that Benefit had breached the agreement’s express terms. It did 

not abandon the contract claim entirely.

B. Dansko’s claim is not barred by federal or 

Pennsylvania law

Benefit says that even if Dansko did not waive the contract 

claim, we can affirm its rejection under ERISA or Pennsylvania trust law. We disagree.

1. Federal law. Benefit argues that ERISA preempts this 

suit. Employee Retirement Income Security Act of 1974, 29 

U.S.C. ch. 18 (ERISA). We disagree. ERISA does preempt 

some state-law claims, but only those that are “challenge[s] to 

the actual administration of [an employee benefit] plan.” Nat’l 

Sec. Sys., Inc. v. Iola, 700 F.3d 65, 85 (3d Cir. 2012). It does 

not preempt “run-of-the-mill state law claims” that just happen 

to “affect[] and involv[e] ERISA plans and their trustees.” 

Mackey v. Lanier Collection Agency & Serv., Inc., 486 U.S. 

825, 833 (1988).

Dansko’s contract claim happens to involve an ERISA 

plan. But its claim is “quite remote from the areas with which 

ERISA is expressly concerned—reporting, disclosure, fiduciary responsibility, and the like.” Iola, 700 F.3d at 85 (internal 

quotation marks omitted). It is thus not preempted.

2. Pennsylvania law. Benefit adds that Dansko cannot sue 

for breach of trust. In Pennsylvania, a breach of trust is “[a] 

violation by a trustee of a duty the trustee owes to a beneficiary.” 20 Pa. C.S.A. §7781(a) (emphasis added). Dansko is 

not a beneficiary of the trust; only its employees are. But 

Dansko did not sue for breach of trust. It sued Benefit not on 
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behalf of its employees, but for itself. So Benefit’s argument is 

off base.

Finally, Benefit says that it never breached the contract. But 

because the District Court thought Dansko had waived the contract claim, it never addressed this issue. We will let the District 

Court consider Benefit’s remaining arguments on remand.

III. DANSKO’S ESTOPPEL CLAIM SURVIVES

Next, Dansko claims promissory estoppel. It alleges that 

along with whatever promises Benefit made in the trust agreement, it also promised to serve as trustee for the debt deal. Even 

though Benefit never put the promise in a formal contract, 

Dansko says, it is enforceable by estoppel.

The District Court thought that the estoppel claim was 

barred because Dansko and Benefit did have a formal contract: 

the trust agreement. We disagree. True, a party cannot bring an 

estoppel claim when a contract claim could cover the same 

ground. But here, the estoppel claim is about a promise that 

Benefit made years after it signed the agreement. Thus, though 

Dansko cannot recover on both its contract and promissory estoppel claims because they allege the same injury, it can still 

bring both claims for now.

Benefit asks us to affirm on two other grounds, arguing that 

estoppel cannot enforce implied or oral promises. Both these 

arguments are mistaken too.
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A. The estoppel claim is not barred by the trust 

agreement

A party may not use estoppel to enforce a contractual promise. After all, estoppel is only a contract “substitute” for when 

“the formal requirements of contract formation have not been 

satisfied.” Carlson v. Arnot-Ogden Mem’l Hosp., 918 F.2d 

411, 416 (3d Cir. 1990) (internal quotation marks omitted). But 

Dansko is not trying to use estoppel to enforce the words of the 

trust agreement. Instead, it relies on statements Benefit allegedly made after signing the agreement. Compare App. 46 

(Complaint) (pleading that Benefit agreed to serve as trustee 

on June 18, 2014), with id. at 48 (alleging estoppel based on 

statements made over the next six months). So the estoppel 

claim is proper.

B. The estoppel claim need not rely on an express 

promise

In the alternative, Benefit argues that it never expressly

promised to help with the deal. In Pennsylvania, it argues, estoppel applies only to express promises.

Though the Supreme Court of Pennsylvania has never addressed this issue, we doubt it would agree. First, “Pennsylvania has adopted the Restatement view of promissory estoppel.” 

Edwards v. Wyatt, 335 F.3d 261, 277 (3d Cir. 2003); see Kreutzer v. Monterey Cty. Herald Co., 747 A.2d 358, 361 (Pa. 2000). 

And one of the Restatement’s examples of estoppel involves 

an “implied promise.” Restatement (Second) of Contracts §90 

illus. 3. Plus, in dicta, many lower Pennsylvania courts have 

said that “[m]isleading words, conduct, or silence” can amount 
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to a “promise” that will support promissory estoppel. PennAire Aviation, Inc. v. Adapt Appalachia, LLC, No. 565 WDA 

2016, 2017 WL 3169280, at *5 (Pa. Super. Ct. July 26, 2017)

(citing Novelty Knitting Mills, Inc. v. Siskind, 457 A.2d 502, 

503 (Pa. 1983)); accord Lehigh Valley Hosp. v. Cty. of Montgomery, 768 A.2d 1197, 1200 (Pa. Commw. Ct. 2001); Thomas 

v. E.B. Jermyn Lodge No. 2, 693 A.2d 974, 977 (Pa. Super. Ct.

1997).

What is more, at oral argument Benefit’s lawyer admitted 

that he could not point to any Pennsylvania estoppel case that 

required a promise to be express. So we see no evidence that 

Pennsylvania courts limit estoppel to express promises.

True, Benefit does cite one of our cases, but it overreads 

that case. C & K Petroleum Prods., Inc. v. Equibank, 839 F.2d 

188 (3d Cir. 1988). In C & K, we upheld dismissal of an estoppel claim because “there [was] no express promise by [the defendant] that could justifiably be relied upon.” Id. at 192. Benefit reads C & K as requiring an express promise. But the case 

is not so broad. There, we upheld the dismissal because it 

rested on “such a broad and vague implied promise.” Id. In 

other words, that promise was too indefinite. We did not hold 

that an implied promise could never be narrow and specific 

enough. We think that one could be. On remand, the District 

Court may consider if the promise here was concrete enough 

to support an estoppel claim.
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C. The estoppel claim need not rely on a written 

promise

Finally, Benefit argues that if it had helped with the deal, it 

would have eventually needed to commit in writing. So it argues that Dansko’s reliance on an oral promise was unreasonable.

We disagree. The whole point of promissory estoppel is to 

enforce a promise even when “the formal requirements of contract formation have not been satisfied.” Carlson, 918 F.2d at 

416. Thus, failure to follow contract formalities does not by 

itself defeat an estoppel claim.

In sum, Dansko’s estoppel claim is not barred by the trust 

agreement or by resting on an implied oral promise. The District Court erred in holding otherwise. 

IV. DANSKO’S FRAUD CLAIM SURVIVES

Dansko’s last claim is that Benefit fraudulently induced 

Dansko to hire it as a trustee. When Dansko was vetting Benefit, Benefit falsely denied that the Department of Labor had investigated it. Dansko says that lie tricked it into hiring Benefit.

The District Court rejected the fraud claim based on the 

trust agreement’s integration clause. We disagree. By signing 

an integration clause, a party concedes that it has not yet been 

falsely induced to sign the contract. But here, Benefit made 

false statements years after Dansko signed the integration 

clause. So the clause does not cover Benefit’s statements and 

does not bar the fraud claim.
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Alternatively, Benefit argues, the gist-of-the-action doctrine bars the fraud claim because it is just a repackaging of the 

contract claim. Again, we disagree. The trust agreement is silent on Benefit’s background. Any duty to be honest about the 

investigation came from tort law, not the contract.

A. Dansko’s fraud claim is not barred by the 

integration clause

The trust agreement has an integration clause. It says: 

“[T]here are no other agreements or understandings between 

the parties relating to the subject matter hereof ... .” App. 99.

Normally, an integration clause bars a party’s later claim that 

he was fraudulently induced to sign the contract. Yocca v. Pittsburg Steelers Sports, Inc., 854 A.2d 425, 436–37, 437 n.26 (Pa. 

2004). A plaintiff can hardly claim to have relied on a lie about 

the contract if he denied having any side understandings.

But that logic does not apply here. The substance of the 

trust agreement, including the integration clause, was negotiated by Dansko and Benefit’s predecessor in 2011. When the 

original parties signed the integration clause, they were asserting that they had “no other agreements or understandings” as 

of 2011. Three years later, Dansko and Benefit agreed to substitute Benefit in as the new trustee. But they did not touch the 

rest of the agreement. They never updated the integration 

clause to say they had no side agreements as of 2014.

Nor did the clause update automatically. Under Pennsylvania law, a contract’s integration clause “does not serve as an 

integration clause for [a] subsequently signed ... [a]mendment.” Giant Food Stores, LLC v. THF Silver Spring Dev., 
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L.P., 959 A.2d 438, 447 n.4 (Pa. Super. Ct. 2008). If the parties 

want to disclaim any outside understandings about an amendment, they must say so when they sign the amendment. Dansko 

and Benefit did not say so as of 2014. So the integration clause 

applies as of 2011, not to the false statements in 2014.

In its brief, Benefit characterized the 2014 change not as an 

amendment, but as a new contract with the same terms (a novation). But at oral argument, Benefit retreated from this position, conceding that we could view the substitution as an 

amendment. It does not matter. Either way, the parties never 

renegotiated the terms or updated the integration clause. They 

never stipulated that they had no side understandings about the 

2014 substitution.

B. The fraud claim is not a contract claim

In the alternative, Benefit asks us to reject Dansko’s claim 

as just a repackaging of its contract claim. We disagree. A 

fraud claim is really a contract claim (and must thus be dismissed) if the “duty [allegedly] breached is one created by the 

parties by the terms of their contract.” Bruno v. Erie Ins. Co., 

106 A.3d 48, 68 (Pa. 2014). In other words, a plaintiff cannot 

say that a defendant defrauded him just by reneging on a contractual promise. By contrast, when “the claim involves the defendant’s violation of a broader social duty owed to all individuals, which is imposed by the law of torts,” it is a true fraud 

claim. Id.

Dansko’s claim is a true fraud claim. Benefit’s statement 

had nothing to do with the contents of the trust agreement. It 

lied about a side issue: Benefit’s suitability to become trustee. 
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By making that statement, Benefit violated not the contract, but 

(if anything) a social duty not to lie to business partners.

Benefit asks us to affirm on other grounds. It says that 

Dansko never relied on the false statement, that any reliance 

was unreasonable, and that the statement did not harm Dansko. 

We will leave all of these issues for the District Court to address on remand.

V. DANSKO MUST ADVANCE BENEFIT’S LEGAL FEES

Benefit counterclaims for the costs of defending this lawsuit, based on the trust agreement’s indemnification clause. In 

response, Dansko argues that Benefit is not a party to the agreement and that this case does not trigger the clause. We disagree 

with Dansko. A premise of its own suit is that Benefit is a party 

to the agreement. And the agreement unambiguously requires 

Dansko to indemnify and reimburse Benefit for the costs of defending this suit.

A. Benefit is a party to the trust agreement

Dansko errs in arguing that Benefit never signed the agreement. In June 2014, Dansko “appoint[ed] Benefit Trust Company to replace Reliance Trust Company as the successor trustee of the Trust” and “RESOLVED ... that Benefit Trust Company be substituted for Reliance Trust Company in the Trust 

Agreement.” App. 396–97. Just over two weeks later, Benefit 

“accepted its appointment as the Trustee.” App. 399. By doing 

that, Benefit signed onto the trust agreement.

Dansko’s argument is not only wrong, but also estopped. 

Dansko sued Benefit for breaching the trust agreement. That 
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claim presupposes that Benefit agreed to the trust agreement. 

By bringing its contract claim, Dansko has conceded that the 

trust agreement binds the party. It is estopped from taking an 

inconsistent position.

B. Under the trust agreement, Dansko must advance 

Benefit’s legal fees

The indemnification clause is broad but clear: Dansko must 

advance Benefit’s legal fees. The clause says that “[Dansko] 

agrees to indemnify [Benefit] and its directors, employees and 

officers ... [for] any and all expenses reasonably incurred in ...

defending ... any ... litigation ... to which [it] may become 

subject ... relating to [Benefit’s] duties as Trustee.” App. 100

(§9.9). Dansko must pay these expenses “as and when [Benefit] incurs them.” App. 101 (§9.10).

But the parties carved out from the scope of the indemnity 

a “Non-Indemnity Loss,” which includes any “claim, damage, 

expense, liability or loss ... from the bad faith, gross negligence, willful misconduct or material breach of the terms of 

[the trust agreement] by [Benefit].” App. 100–01 (§9.9). If 

Benefit receives any advancement for what is ultimately determined to be a Non-Indemnity Loss, it probably would have to 

return that money to Dansko. App. 101–12 (§9.10). 

1. The word “indemnify” includes first-party indemnity. In 

resisting this conclusion, Dansko focuses on the word “indemnify.” It argues that to “indemnify” means to reimburse for 

losses caused by a third party, not by Dansko. We disagree. 

“The plain, unambiguous meaning of ‘indemnify’ is not ‘to 

compensate for losses caused by third parties,’ but merely ‘to 
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compensate.’ ” Atari Corp. v. Ernst & Whinney, 981 F.2d 1025, 

1032 (9th Cir. 1992) (quoting Black’s Law Dictionary 769 (6th 

ed. 1990)); see, e.g., Indemnify, Black’s Law Dictionary (11th 

ed. 2019) (“To reimburse (another) for a loss suffered because 

of a third party or one’s own act or default” (emphasis added)); 

see also Indemnify (def. 2a), Oxford English Dictionary (2d ed. 

1989) (drawing no distinction between first-party and thirdparty indemnification). Dansko cites no authority for its narrower definition.

Further, the parties contemplated exceptions to the indemnity when they carved out “Non-Indemnity Loss” from the indemnity and reimbursement provisions. But that carve-out

does not extend to all first-party claims. So we will not read in 

that exception when the parties negotiated none.

2. The indemnification clause does not contradict another 

part of the contract. The District Court thought that another 

part of the contract would make no sense if the clause applied 

to first-party claims. The contract says that if Benefit is sued, 

Dansko can assume Benefit’s defense. The court thought “[i]t 

would be absurd to give Dansko the right to assume [Benefit’s] 

defense against [Dansko].” 418 F. Supp. 3d at 111. It would 

be. But the contract does not say that. Though the contract generally lets Dansko assume Benefit’s defense, it carves out an 

exception for when Dansko and Benefit have a conflict of interest. 

3. The indemnification clause will not limit Benefit’s negligence liability. Lastly, Dansko says that the contract cannot 

cover first-party claims because if it did, that “would limit 

[Dansko’s] rights of action.” Dansko Br. 29. Here, Benefit
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seeks only litigation costs. But Dansko points out that the indemnification clause covers not only litigation costs, but also 

“damages ... liabilities and losses.” App. 100 (§9.9). If Dansko 

had to indemnify Benefit against its own negligence suits

against Benefit, that would effectively release Benefit from 

negligence liability to Dansko.

We doubt this would happen. In Pennsylvania, a prospective release for negligence is “unenforceable” unless it does so 

“with the greatest particularity.” Topp Copy Prods., Inc. v. Singletary, 626 A.2d 98, 99 (Pa. 1993). The trust agreement’s 

words are general and do not mention Dansko’s own suits. So 

the agreement is not an enforceable release, and our reading 

does not limit Dansko’s substantive rights to sue for negligence.

At root, Dansko objects that a first-party indemnity would 

be surprising. But the words to which the parties agreed require 

that. “When a writing is clear and unequivocal, its meaning 

must be determined by its contents alone.” Murphy v. Duquesne Univ. of the Holy Ghost, 777 A.2d 418, 429 (Pa. 2001)

(quoting Robert F. Felte, Inc. v. White, 302 A.2d 347, 351 (Pa. 

1973)). And while we “must strictly construe the scope of an 

indemnity contract against the party seeking indemnification,”

this contract is unambiguous. Jacobs Constructors, Inc. v. NPS 

Energy Servs., Inc., 264 F.3d 365, 371 (3d Cir. 2001). We will 

hold Dansko to the terms it agreed to.
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* * * * *

The District Court erred in granting summary judgment 

against Dansko’s contract, estoppel, and fraud claims as well 

as Benefit’s indemnity claim for reasonable litigation costs. 

We will thus vacate and remand for further proceedings.