The opinion of the court was delivered by: Scheindlin, District Judge.
MEMORANDUM OPINION AND ORDER
Plaintiffs Gabriel Capital, L.P. ("Gabriel Capital") and Ariel
Fund Ltd. ("Ariel Fund") sued defendants NatWest Finance, Inc.
("NatWest"), McDonald Investments Inc. ("McDonald"), and Steel
Dynamics Inc. ("SDI") for securities fraud arising from
plaintiffs' purchase of bonds issued by a Thailand corporation,
Nakornthai Strip Mill Public Company Limited (the "NSM
Notes").*fn1 Plaintiffs alleged that NatWest violated section
10(b) of the Securities and Exchange Act of 1934 (the "1934
Act"), 15 U.S.C. § 78j(b), and Rule 10b-5 promulgated
thereunder, 17 C.F.R. § 240.10b-5, by making or participating in
the making of untrue statements and by omitting material facts
in order to induce plaintiffs to purchase the NSM Notes.
Plaintiffs also alleged that through the same conduct, NatWest
committed common law fraud, conspired to commit fraud, and aided
and abetted fraud in violation of New York law.
On May 8, 2000, this Court denied NatWest's and McDonald's
motion to dismiss plaintiffs' first Amended Complaint and
granted in part and denied in part SDI's motion to dismiss. See
Gabriel Capital, L.P. v. NatWest Finance, Inc., 94 F. Supp.2d 491,
512 (S.D.N.Y. 2000) ("Gabriel I"). On May 30, 2000,
plaintiffs filed their Second Amended Complaint ("SAC"), which
added claims against two new defendants, NatWest Capital Markets
Limited ("NatWest Capital") and National Westminster Bank PLC
("NatWest Bank"), and attempted to cure the deficiencies in the
allegations against SDI. SDI, NatWest Capital and NatWest Bank
moved to dismiss the SAC. These motions were also denied. See
Gabriel Capital, L.P. v. NatWest Finance, Inc., 122 F. Supp.2d 407,
437 (S.D.N.Y. 2000) ("Gabriel II ".)
The allegations in the Amended Complaint have already been
exhaustively summarized in Gabriel I, see 94 F. Supp.2d at
495-98, as have the allegations in the SAC, see Gabriel II,
122 F. Supp.2d at 411-17. Familiarity with both opinions and the
facts contained therein is assumed for purposes of this motion.
For the sake of brevity, only the facts uniquely relevant to
this motion will be reiterated.
A. The Alleged Misrepresentations
Plaintiffs allege that the NatWest defendants made
misrepresentations in both the Offering Memorandum and the road
show presentation concerning the following:
(i) the status of the hot mill, see SAC ¶¶ 25 and
(ii) the design of the mini-mill, see id. ¶¶ 27 and
(iii) the ability of NSM to secure an adequate supply
of scrap metal, see id. ¶¶ 29 and 30;
(iv) the existence of "off-take" agreements, see
id. ¶¶ 31 and 32; and
(v) the management of NSM, see id. ¶¶ 33-35.
Additionally, plaintiffs allege that the Offering Memorandum
contained misrepresentations concerning the use of proceeds from