In the

United States Court of Appeals
               For the Seventh Circuit

No. 09-2821

R EGER D EVELOPMENT, LLC,
                                                  Plaintiff-Appellant,
                                  v.

N ATIONAL C ITY B ANK,
                                                 Defendant-Appellee.


             Appeal from the United States District Court
        for the Northern District of Illinois, Eastern Division.
            No. 08-CV-6200—Virginia M. Kendall, Judge.



   A RGUED D ECEMBER 9, 2009—D ECIDED JANUARY 20, 2010




 Before F LAUM, W ILLIAMS, and S YKES, Circuit Judges.
  F LAUM, Circuit Judge. Reger Development borrowed
money from National City through a revolving line of
credit supported by a promissory note. Then, when
National City discussed the possibility of calling the
note, Reger Development sued the bank for breach of
contract and fraud. After reviewing the terms of the
governing contract, the district court dismissed the com-
plaint. We now affirm.
2                                               No. 09-2821

                      I. Background
  This is a diversity case governed by Illinois law. For the
purposes of this appeal, defendants-appellees accept as
true the allegations contained in appellant’s complaint.
Plaintiff-appellant Reger Development, LLC (“Reger
Development”) is an Illinois limited liability company
involved in real estate development. Kevin Reger is
Reger Development’s principal and sole member.
Defendant-appellee National City Bank (“National City”),
was headquartered in Cleveland, Ohio, at the time
this lawsuit commenced and had lent money to Reger
Development for several previous projects. In June 2007,
National City offered the company a line of credit to fund
potential development opportunities. On June 25, 2007,
Kevin Reger met with Erica Duncan, a National City
representative, to discuss the loan. At some point, when
Reger asked about changing the terms of the arrangement,
Duncan responded that the documents National City
provided were nonnegotiable. Reger Development then
executed the form contract, which was structured as a
promissory note (“Note”) coupled with a commercial
guaranty by Kevin Reger in his individual capacity for
the debt of his business entity. Reger Development at-
tached both contracts to its initial complaint.
   The main question in this case is whether the Note
entitles National City to demand payment from Reger
Development at will. To this end, several excerpts from
the two-page contract are particularly important. The
first clause in the Note reads:
    PROMISE TO PAY: Reger Development, LLC (“Bor-
    rower”) promises to pay to National City Bank
No. 09-2821                                             3

   (“Lender”), or order, in lawful money of the United
   States of America, on demand, the principal amount of
   Seven Hundred Fifty Thousand & 00/100 Dollars
   ($750,000.00) or so much as may be outstanding,
   together with interest on the unpaid outstanding
   principal balance of each advance. Interest shall be
   calculated from the date of each advance until repay-
   ment of each advance.
   PAYMENT: Borrower will pay this loan in full immedi-
   ately upon Lender’s demand. Borrower will pay
   regular monthly payments of all accrued unpaid
   Interest due as of each payment date, beginning
   July 25, 2007, with all subsequent Interest payments to
   be due on the same day of each month after that.
   ...
   FAILURE TO PAY ON DEMAND. Notwithstanding
   any other provision set forth in this Note, if (a) any
   principal owing under this Note remains unpaid
   after Lender shall have given Borrower notice of
   demand for payment thereof or after the commence-
   ment of any proceeding under any bankruptcy or
   insolvency laws by or against Borrower or (b) any
   accrued Interest under this Note remains unpaid
   after the due date of that Interest, then, and in each
   such case, all unpaid principal of this Note shall
   bear Interest at a rate equal to three percent (3%) per
   annum above the rate that would otherwise be ap-
   plicable. Interest, whether prior to or after judgment
   by a court of competent jurisdiction, shall continue
   upon the outstanding balance until paid in full, at
4                                               No. 09-2821

    the higher of the rate provided in this Note or the
    rate otherwise permitted by law.
  The Note proceeds to reference payment on lender’s
demand several times in other provisions. It also features
a “NO COMMITMENT” clause that states: “NOTWITH-
STANDING ANY PROVISION OR INFERENCE TO
THE CONTRARY, LENDER SHALL HAVE NO OBLIGA-
TION TO EXTEND ANY CREDIT TO OR FOR THE
ACCOUNT OF BORROWER BY REASON OF THIS
NOTE.” The contract then includes integration language
defining it as the final and complete agreement between
parties. The Note is governed by federal and Illinois law,
to the extent the former does not preempt the latter.
Language above the signature line specifies in capital
letters that the borrower has read and understood the
terms of the document. Reger Development paid a
$5000 closing fee for the line of credit.
  About a year after Reger Development executed the
contract, National City requested updated personal
financial statements and tax returns pursuant to a clause in
the Note entitling the bank to do so. The borrower com-
plied. Through that point, Reger Development had made
timely interest payments on the loan. On August 19, 2008,
National City asked the company to pay down $125,000
towards the principal of the line of credit, which
appellant did the next business day. Then, on September 9,
2008, National City asked that Reger Development “term
out” $300,000 of the Note by having one of Kevin Reger’s
other businesses agree to take out a three-year loan in
that amount secured by a second mortgage on some real
No. 09-2821                                                5

estate. National City also notified appellant that it would
be reducing the amount of cash available through the
line of credit from $750,000 to between $400,000 and
$500,000.
  Kevin Reger “expressed surprise” about these develop-
ments and asked if National City would call the line of
credit if Reger Development did not agree to the requests.
The bank acknowledged that Reger Development was
not in default but stated that “there is a possibility that
we may demand payment of the line.”
  Reger Development then filed a complaint in Illinois
state court accusing National City of breaching the terms
of the Note. The company also alleged that National City
used the form promissory note contracts to perpetuate
a fraudulent scheme in which the bank fooled people
into taking out loans by concealing the fact that the princi-
pal could be called on demand. Appellee removed the
case to the Northern District of Illinois under diversity
jurisdiction and then successfully moved to dismiss the
complaint for failure to state a cause of action under
which relief could be granted. The district court rejected
Reger Development’s Motion for Reconsideration under
Fed. R. Civ. P. 59(e). Reger Development now appeals
from both the substantive judgment and denial of the
motion to reconsider.


                      II. Discussion
  We review the district court’s grant of a motion to
dismiss under Fed. R. Civ. P. 12(b)(6) de novo. Tamayo v.
6                                                  No. 09-2821

Blagojevich, 

, 1081 (7th Cir. 2008). When
evaluating the sufficiency of the complaint, we construe
it in the light most favorable to the nonmoving party,
accept well-pleaded facts as true, and draw all inferences
in her favor. 

the district court’s denial of
Reger Development’s motion for reconsideration for
abuse of discretion and reverse “only if no reasonable
person could agree with that decision.” Schor v. City of Chi.,

, 780 (7th Cir. 2009). In his jurisdictional
statement, Reger Development announces that it is ap-
pealing both the district court’s decision to dismiss its
original complaint and the district court’s subsequent
denial of Reger Development’s motion for reconsideration.
However, as the appellee points out, the remainder of
Reger Development’s brief never identifies the standard
of review for a district court’s 59(e) ruling, mentions
the denial, or makes any substantive arguments that
would require us to examine that decision. We treat
this silence as a waiver of Reger Development’s right to
contest the 59(e) ruling, though we note that the switch
in posture changes nothing about the outcome of this
appeal.
  The Supreme Court has described the bar that a com-
plaint must clear for purposes of Rule 12(b)(6) as follows:
“To survive a motion to dismiss, a complaint must
contain sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face. ’ ” Ashcroft v.
Iqbal, 

, 1949 (2009) (quoting Bell Atl. Corp. v.
Twombly, 

, 555 (2007)). A “formulaic recitation
of the elements of a cause of action will not do.” 

a plaintiff must provide “only ‘enough detail to
No. 09-2821                                                  7

give the defendant fair notice of what the claim is and
the grounds upon which it rests, and, through his al-
legations, show that it is plausible, rather than merely
speculative, that he is entitled to relief. ’ ” 

. Furthermore, plaintiffs must plead their
accusations of fraud with particularity. Fed. R. Civ. P. 9(b);
Arazie v. Mullane, 

, 1465 (7th Cir. 1993) (stating
that particularity requires the party to specify the “who,
what, when, where, and how” of the alleged fraudulent
act). We consider documents attached to the com-
plaint as part of the complaint itself. Int’l Mktg., Ltd. v.
Archer-Daniels-Midland Co., 

, 729 (7th Cir. 1999).
Such documents may permit the court to determine
that the plaintiff is not entitled to judgment. Hecker v. Deere
& Co., 

, 588 (7th Cir. 2009).


A. Reger Development’s Breach of Contract Claim
  Under Illinois law, a plaintiff looking to state a colorable
breach of contract claim must allege four elements: “(1) the
existence of a valid and enforceable contract; (2) sub-
stantial performance by the plaintiff; (3) a breach by
the defendant; and (4) resultant damages.” W.W. Vincent &
Co. v. First Colony Life Ins. Co., 

, 967 (Ill.
App. Ct. 2004). We construe contracts by giving their
unambiguous terms clear and ordinary meaning, Reynolds
v. Coleman, 

, 902 (Ill. App. Ct. 1988), in an
effort to determine the parties’ intent. Harrison v. Sears,
Roebuck & Co., 

, 253 (Ill. App. Ct. 1989).
During our review, we do not look at any one contract
provision in isolation; instead, we read the document as
8                                                No. 09-2821

a whole. Martindell v. Lake Shore Nat’l Bank, 

, 689 (Ill. 1958).
  While Illinois law generally holds that “a covenant of
fair dealing and good faith is implied into every
contract absent express disavowal,” Foster Enter., Inc. v.
Germania Fed. Sav. & Loan Ass’n, 

, 1380 (Ill.
App. Ct. 1981), the duty to act in good faith does not
apply to lenders seeking payment on demand notes. See
N.W.I. Int’l, Inc. v. Edgewood Bank, 

, 409 (Ill.
App. Ct. 1997); see also 810 ILCS 5/1-309 cmt. (“Obviously
this section [which imposes a requirement that lenders
utilize their rights under acceleration clauses only
when they have a good-faith belief that the prospect of
performance is impaired] has no application to
demand instruments or obligations whose very nature
permits call at any time with or without reason.
This section applies only to an obligation of payment or
performance which in the first instance is due at a
future date.”). In light of this controlling law, appellant’s
complaint appears vacuous. Reger Development’s al-
legations are “that National City breached the Contract
Documents by arbitrarily and capriciously (1) demanding
payment under the Line of Credit even though Reger
Development was in good standing and (2) unilaterally
changing and attempting to change the fundamental
terms of the Contract Documents without Reger Develop-
ment’s consent.” Reger Development attempts to sub-
stantiate the first part of the breach claim by pointing
to several provisions in the Note that it believes to be
fundamentally inconsistent with the nature of a demand
instrument. These include the “INTEREST AFTER DE-
No. 09-2821                                             9

FAULT” provision, which reads, in relevant part, “[u]pon
default, including failure to pay upon final maturity, the
interest rate on this Note shall be increased by adding a
2.000 percentage point margin;” the prepayment clause,
which allows the borrower to pay down “all or a portion
of the amount owed earlier than it is due;” and the
clause that grants National City the right to access the
borrower’s financial information. Reger Development
describes the latter as a “financial insecurity” provision
that conditions the right to demand payment on some
economic cause.
  We are not persuaded by the suggestion that these
references to due dates and default somehow overpower
the repeated, explicit contract language setting forth the
lender’s right to demand payment at any time. A bank
that wishes to call the Note can specify some future date
on which it needs payment as a “due date.” Failure to
pay at that point in time, as well as failure to make
monthly interest payments required by the Note,
would constitute default, but the mere use of the terms
“due date” or “default” would not alter the nature of the
agreement. Similarly, the “PREPAYMENT” provision
cannot bear the interpretive load that appellant wants
to place on its shoulders. The clause reads: “Borrower
may pay without penalty all or a portion of the amount
owed earlier than it is due. Early payments will not,
unless agreed to by Lender in writing, relieve Borrower
of Borrower’s obligation to continue to make payments
of accrued unpaid Interest.” Both its content and place-
ment (immediately following the “payment” and “variable
interest rate” clauses) are innocuous. The language
10                                              No. 09-2821

merely reinforces National City’s right to collect
scheduled monthly interest payments and does not
deviate from the structure of a demand note.
  Reger Development does cite to decisions from other
jurisdictions holding that specified events of default
may neuter contractual language describing a loan as
payable on demand. See, e.g., Bank One, Tex., N.A. v.
Taylor, 

, 32 (5th Cir. 1992); Reid v. Key Bank of
S. Me., Inc., 

, 14 (1st Cir. 1987); New Bank of
New England, N.A. v. J.T. Enter., 

, *2 (D.
Mass. 1992). These authorities describe instruments
with traits that look out of place in a demand note.
Because the National City Note lacks these anomalous
features, the cases have little bearing on our interpreta-
tion of the present contract. For example, Bank One,
Texas discusses notes secured by a car and a boat
that specified a payment schedule and included an ac-
celeration clause. While the National City requirement
for monthly interest payments does bear some semblance
to a comprehensive payment schedule, a real schedule
would cover principal payments so as not to create
the impression that the lender is giving away money.
Furthermore, the Bank One, Texas court actually distin-
guished the contract before it from one that a Texas
appellate court identified as a demand note, see Conte v.
Greater Houston Bank, 

(Tex. App. 1982),
because the Bank One Note featured an acceleration
clause conspicuously absent from both the Conte instru-
ment and National City Note. Such a provision would
indeed cast doubt on the intent of the parties to create a
callable loan for the reasons Reger Development set
No. 09-2821                                                 11

forth—if the lender can demand full payment at any
time, it wouldn’t need to “accelerate” the loan matu-
rity—but these concerns can’t gain traction without
support from contractual language. As described above,
mere references to due dates do not suffice.
  Similarly, Reid dealt with a case where the lender’s
president testified that a “demand” term in a clause
demanding a fixed-sum payment did not mean what it
said in the context of provisions conditioning such ac-
celerated payments and enumerating default events.
Given the distinct terms of the National City Note, we
find the logic of the Reid court to be inapplicable to the
case at hand. Viewed as a whole in the light most
favorable to the nonmoving party, the Note before us is
plainly a demand instrument entitling National City to
collect its loan whenever it wants. Furthermore, adequate
consideration passed during the transaction because
National City actually funded the credit line and
permitted appellant to draw down funds in return for
the $5000 closing fee. Mid-Town Petroleum, Inc. v. Gowen,

, 1227 (Ill. App. Ct. 1993) (“[A] peppercorn
can be considered sufficient consideration to support a
contract in a court of law . . . .”).
  Finally, National City’s reiteration of its contractual right
to demand payment during negotiations with Reger
Development does not amount to a breach of the
covenant to avoid modifications without consent of the
borrower. The Note provides that “All such parties [who
sign the Note] also agree that Lender may modify this
loan without the consent of or notice to anyone other
12                                              No. 09-2821

than the party with whom the modification is made.”
Reger Development claims that National City breached
this covenant when the bank asked it to term out part of
the line of credit, but National City did not actually
impose any unilateral changes on the appellant. Rather,
the bank presented Reger Development with two
options: live by the terms of the Note and face the possi-
bility of a call on the loan, or agree to restructure the
terms of credit. The second alternative required ap-
pellant’s consent, as stated in the governing contract.
The bank’s decision to hold off on taking full ad-
vantage of its legitimate powers until it could discuss
less painful possibilities with its customer is not an imper-
missible threat and cannot give rise to any suit for
breach. Reger Development’s lone citation for the
contrary proposition, Kham & Nate’s Shoes No. 2, Inc. v.
First Bank of Whiting, 

(7th Cir. 1990), is a
vacated opinion discussing the duties of a bank under
the bankruptcy code where this Court expressly
endorsed the principle that good-faith restrictions do not
bind demand-note lenders. See 

see also 

(“ ‘ Firms that have negotiated contracts are
entitled to enforce them to the letter, even to the great
discomfort of their trading partners, without being
mulcted for lack of “good faith. ’ ”).


B. Reger Development’s Fraud Claim
  To state a fraud claim under Illinois law, a plaintiff must
allege that the defendant: (i) made a false statement of
material fact; (ii) knew or believed the statement to be
No. 09-2821                                               13

false; (iii) intended to and, in fact, did induce the
plaintiff to reasonably rely and act on the statement; and
(iv) caused injury to the plaintiff. Redarowicz v. Ohlendorf,

, 331 (Ill. 1982).
  Appellant asserts that
    The Contract Documents show that National City
    e n ga ge d i n a s c h e m e t o d e f r a u d R e g e r
    Development . . . when National City drafted the
    purposefully ambiguous and misleading Promissory
    Note and other Contract Documents, which National
    City intended all along to call “on demand,” but
    about which National City intentionally and fraudu-
    lently gave a much different impression to its bor-
    rowers.
We address only the first of several reasons why
this position cannot stand in court: Reger Development’s
failure to plead intent with any semblance of particular-
ity. To establish element (iii) of his fraud claim, appellant
asks us to draw the inference
    that no reasonable borrower would have paid $5,000
    to enter into a line of credit if it had been clearly
    drafted to provide that the note could be called at
    any time and for any reason whatsoever, including
    a bad reason. Thus, National City had to have
    drafted ambiguous documents so that National City
    could mislead its borrowers. That is the only explana-
    tion for the ambiguous and otherwise inexplicable
    terms that National City included regarding
    defaults, maturity dates and due dates.
14                                              No. 09-2821

  As we stated above, the Note before us is neither am-
biguous nor inexplicable. Rather, it is a straightforward
demand instrument accompanied by a personal
guaranty by the borrower’s sole member. With respect to
intent, we simply cannot draw the inference that Reger
Development asks us to make without ignoring the con-
tract altogether. While Illinois law permits parties to
prove intent to deceive with circumstantial evidence, see
White v. DaimlerChrysler Corp., 

, 549 (Ill.
App. Ct. 2006), courts presume that transactions are fair
and honest until shown to be otherwise, Avery v. State
Farm Mut. Auto. Ins. Co., 

, 855 (Ill. 2005). A
“party cannot close his eyes to the contents of a docu-
ment and then claim that the other party committed
fraud merely because it followed this contract.” N. Trust
Co. v. VII S. Mich. Assocs, 

, 1103 (Ill. App.
Ct. 1995). The district court described several other
flaws in Reger Development’s fraud claim. We agree
with the lower court’s reasoning but see no need to
reach those issues.


                     III. Conclusion
  For the foregoing reasons, we A FFIRM the district court’s
grant of National City’s motion to dismiss the Reger
Development complaint.




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