The opinion of the court was delivered by: McKENNA, D.J.
This Memorandum and Order addresses various motions to dismiss filed by five Agent Banks.*fn1 The Agent Banks seek dismissal of Claim 32 alleging violation of the Bank Holding Company Act ("BHCA") in Adelphia Recovery Trust's ("ART") Amended Complaint.*fn2 Motions to dismiss were filed by: Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank Nederland", New York Branch ("Rabobank"); Fuji Bank Limited ("Fuji"); Royal Bank of Scotland plc ("RBS"); Merrill Lynch Capital Corp. ("ML Capital")*fn3 ; and Texas Dominion (Texas) LLC ("TD Texas"). The five motions to dismiss were joined by the other Agent Bank Defendants in various configurations. Claim 32 is DISMISSED as to Rabobank, Fuji, and TD Texas. The remaining motions to dismiss are DENIED.
I. Factual and Procedural Background
The factual and procedural background of this case is discussed in detail by this Court in its May 6, 2009 Memorandum and Order. Adelphia Recovery Trust v. Bank of America, N.A., No. 05-CV-9050, 2009 WL 1249360 (S.D.N.Y. May 6, 2009) (hereinafter, "Mem. & Order, May 6, 2009"). Since the issuance of the May 6, 2009 Memorandum and Order this Court has issued two substantive orders affecting the disposition of the case. On June 16, 2009 on a motion for reconsideration filed by Goldman Sachs & Co. this Court required ART to replead Claim 31 (the Margin Loan Claim) to specify which payments to the Margin Lenders*fn4 came from Adelphia Communication Corporation ("ACC"). Adelphia Recovery Trust v. Bank of America, N.A., No. 05-CV-9050, 2009 WL 1676077 (S.D.N.Y. June 16, 2009).*fn5 Subsequently, this Court on July 8, 2009 ruled on the Bank Defendants*fn6 motion to strike ART's demand for a jury trial. Adelphia Recovery Trust v. Bank of America, N.A., No. 05-CV-9050, 2009 WL 2031855 (S.D.N.Y. July 8, 2009). This Court held ART is entitled to a jury trial when pursuing claims on behalf of ACC. However, if ART is pursuing claims on behalf of the Obligor Debtors and the claims arise from the Co-Borrowing Facilities then the claims will be covered by jury waivers.
Claim 32, which this Memorandum and Order addresses, alleges various:
Agent Banks and Investment Banks, acting in concert as a single unit, extended credit and/or furnished services . . . on the condition or requirement that Adelphia also obtain some additional credit, property, and/or service from a subsidiary of the bank holding company of such bank, including the Agent Banks and/or Investment Banks. (Am. Cmpl. ¶ 1367.)
ART alleges these tying arrangements between Agent Banks and Adelphia violated the BHCA. Bank Holding Company Act of 1956, 12 U.S.C. §§ 1841(c), 1971, 1975.
Claim 32 was originally pled in the Creditor Committee Complaint. (Creditor Cmpl. ¶¶ 809-15.) When the Complaint was before the Bankruptcy Court, Judge Gerber held that ART had adequately pled Claim 32 as against the Agent Banks and their affiliated Investment Banks. In re Adelphia Commc'ns Corp., 365 B.R. 24, 75 (Bankr. S.D.N.Y. 2007). Following Judge Gerber's Memorandum and Order ART filed an Amended Complaint on October 31, 2007. The Amended Complaint consolidated the Creditor Complaint and Intervenor Complaint. ART also made revisions to the claims.*fn7 (Am. Cmpl. ¶¶ 1363-69.)
This Court, on January 17, 2008, issued a Memorandum and Order which looked at a variety of aspects of Judge Gerber's opinion. Adelphia Recovery Trust v. Bank of Am., N.A., 390 B.R. 64 (S.D.N.Y. 2008) (hereinafter, "Mem. & Order, Jan. 17, 2008"). This Court in its January 17, 2008 Memorandum and Order dismissed the BHCA Claim (Claim 32) as against the Investment Banks on the grounds that the Investment Banks did not fit within the definition of 'Bank' in the BHCA. (Mem. & Order, Jan. 17, 2008, at 72.)
This Court dismissed Claim 32 with leave to replead to cure ambiguity in the original allegations as against the Agent Banks. This Court requested ART to replead Claim 32 to specify whether the Agent Banks had initiated coercive tying in violation of the BHCA. (Mem. & Order, Jan. 17, 2008, at 73.) ART in addition to the Amended Complaint submitted to this Court a Second Amended Complaint which adds additional factual details to paragraphs 1051 to 1056 of the Amended Complaint. (Second. Am. Cmpl. ¶¶1051-56.)*fn8
II. Standard of Review: This Memorandum and Order responds to various Agent
Bank Defendants' motions to dismiss Claim 32 under Rule 12(b)(6). For ART to avoid dismissal of claims under Rule 12(b)(6) ART must plead "a short and plain statement of the claim showing that the pleader is entitled to relief."
Fed. R. Civ. P. 8(a). However, adequate pleadings must raise a right to relief above the speculative level. "[A] plaintiff's obligation to provide the 'grounds' of his entitle[ment] to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 545 (2007).
The Second Circuit has held, "[f]irst, although 'a court must accept as true all of the allegations contained in a complaint,' that 'tenet' 'is inapplicable to legal conclusions' and '[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.' 'Second, only a complaint that states a plausible claim for relief survives a motion to dismiss' and '[d]etermining whether a complaint states a plausible claim for relief will ... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.'" Harris v. Mills, --- F.3d ----, No. 07-CV-2283, 2009 WL 1956176 (2d Cir. July 9, 2009) (quoting Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949-50 (2009)).
Defendants have submitted various motions to dismiss.
Some arguments made by Defendants are only applicable to particular Defendants. Other arguments apply broadly to all the Defendants. A review of the parties' memoranda of law finds seven primary arguments. This Court addresses each in turn.
1. Lack of an Investment Banking Arm Does not Preclude a BHCA Claim
Rabobank and Fuji allege Claim 32 should be dismissed because it fails to state a claim upon which relief can be granted pursuant to Fed. R. Civ. P. 12(b)(6). They argue a violation of the BHCA requires Rabobank and Fuji have affiliated investment banks. Rabobank and Fuji argue that ART has made no such allegation and, as such, fails to state a claim against either bank under the BHCA. Fuji Reply Mem. at 3; Rabo Mem. at 3. Despite the protestations of Fuji and Rabobank it is not necessary that a Bank have an affiliated Investment Bank for a violation of the BHCA to have occurred.
To sufficiently plead a violation of Section 1972 of the BHCA, ART must allege "that a bank, a bank holding company, or its subsidiary (1) extended credit; (2) on the condition or requirement; (3) that its customer obtain or provide some additional credit, property or service." Nordic Bank PLC v. Trend Group, Ltd., 619 F.Supp. 542, 552 (S.D.N.Y. 1985). Fuji and Rabobank contend that ART has asserted only that "[t]he Agent Banks and Investment Banks, act[ed] in concert as a ...