Capital was unable to secure the release of the LDA by the contractual deadline, instead of terminating the contract at that time, JLB sought to reduce the scope of the deal. JLB then tendered a second amended contract which was rejected by Capital; Capital's counter-offer was rejected by JLB. The parties were unable to reach an agreement or salvage the deal; therefore, JLB formally terminated the contract and requested the return of its earnest money. Capital refused to return JLB's earnest money on the grounds that JLB was equitably estopped from enforcing the forty-five day termination clause. In support of its argument that JLB was equitably estopped from enforcing the forty-five day termination clause, thereby not entitled to the return of the earnest money deposit, Capital claimed that JLB did not terminate the contract at the expiration of the forty-five day period, but rather waited until market conditions had made the real estate project impossible to complete before attempting to terminate the contract. JLB filed suit in the United States District Court for the District of Maryland ("the Court") seeking return of the earnest money.

The three elements of equitable estoppel in Maryland are; (1) voluntary conduct or a representation by the party to be estopped, (2) reliance by the estopping party, and (3) detriment to the estopping party. The party who relies on estoppel must prove the facts that create it. In granting JLB's Motion for Summary Judgment, the Court stated that it was unlikely that Capital could satisfy the elements of equitable estoppel in a commercial setting, involving sophisticated real estate investors and developers that were represented by counsel throughout the transaction at issue. The Court found that JLB had advised Capital that the original deal was defunct and that at no time after the expiration of the forty-five day period did JLB ever represent to Capital that it intended to waive the termination right and proceed with the original deal.