Brief Fact Summary.
Cohen (Plaintiff) provided information to two newspapers after being promised anonymity. The newspapers later disclosed his identity and Plaintiff sued.
Synopsis of Rule of Law.
When examining a transaction under a claim of promissory estoppel in order to determine whether enforcement of the promise is necessary to prevent an injustice, a court should consider all aspects of the transaction’s substance.
Plaintiff provided information to the Minneapolis Star Tribune, published by Cowles Media Co. (Defendant) and the St. Paul Pioneer Press Dispatch with derogatory information concerning a candidate running for public office. The reporters for both newspapers promised Plaintiff that his identity would be protected. Later, editors at both newspapers decided that his identity should be revealed because he was known to have ties to an opposing candidate. When the stories were published, Plaintiff was fired from his job. Plaintiff sued the publishers of both newspapers for breach of contract and fraudulent misrepresentation. The jury found for Plaintiff, awarding him $200,000 in compensatory damages and $250,000 in punitive damages. The appellate court set aside the finding of fraudulent misrepresentation and the punitive damages, but affirmed the compensatory damages for breach of contract. The Minnesota Supreme Court found that promissory estoppel could be a basis for recovery, but that the First Amendment concerns prevented the recovery of damages in this case. The United States Supreme Court granted certiorari and reversed, finding that the First Amendment was not implicated. The case was remanded to the Minnesota Supreme Court.
When a court is analyzing a case under the doctrine of promissory estoppel, should it examine all aspects of the transaction’s substance to determine whether enforcement of the promise is necessary to prevent an injustice?
(Simonett, J.) Yes. When examining a transaction under a claim of promissory estoppel in order to determine whether enforcement of the promise is necessary to prevent an injustice, a court should consider all aspects of the transaction’s substance. The doctrine of promissory estoppel states that a promise that is expected to, and does, induce definite action by the promise is binding if injustice can be avoided only by enforcing the promise. In order to be enforced under this doctrine, the promise must be definite, clear, and intended to induce reliance. Here, the two reporters made unambiguous promises to Plaintiff that he would be treated as an anonymous source. Plaintiff provided the information they sought on the basis of this promise. The court then must determine whether the promise must be enforced to avoid injustice. Neither side in this case is on high moral ground. However, even Defendant’s witnesses testified to the importance of protecting the identity of sources. There does not seem to have been a compelling need to break the promises here either. It would be unjust to Plaintiff if the promises from Defendants were not enforced. The award of compensatory damages is affirmed, but under a theory of promissory estoppel.
Under the doctrine of promissory estoppel a promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise.View Full Point of Law
Instead of sending the case back for a new trial on damages under the new theory of promissory estoppel, the Minnesota Supreme Court determined that the instruction to the jury on damages for breach of contract was also valid for determining damages in a promissory estoppel action. A study was conducted to determine whether this decision affected publishers’ policies on confidential sources and found no substantial change. Most publishers agreed with the result here.