The opinion of the court was delivered by: Townes, U.S.D.J.
In this diversity action, Plaintiff seeks damages for losses sustained in removing and replacing certain saline breast implants from patients who suffered complications therewith. Plaintiff alleges that he was fraudulently induced to enter an agreement with the manufacturer, Defendant Mentor H/S, Inc., and was intentionally misled as to the safety of the implants, causing him monetary damages as well as damages to his professional reputation. Though the Complaint alleges causes of action sounding in negligence and breach of contract, those claims were dismissed pursuant to stipulations on June 4, 2002, and March 8, 2006, respectively. Defendant seeks summary judgment dismissing the remaining claims of fraud, fraudulent inducement to enter a contract, and a violation of New York's General Business Law § 349. Based upon all submissions of the parties and oral argument held on March 17, 2006, and for the reasons stated below, Defendant's motion is granted in full.
FACTS AND PROCEDURAL HISTORY
Plaintiff Robert V. Vitolo, M.D. ("Plaintiff" or "Vitolo") is a plastic surgeon with several offices in the New York City metropolitan area. (Def. 56.1 Stat. ¶ 1.) Defendant Mentor H/S , Inc., ("Defendant" or "Mentor") is a subsidiary of Mentor Corporation, and manufactures, inter alia, saline-filled breast implants. (Def. 56.1 Stat. ¶ 2.) From approximately the early 1980s until August 1995, Defendant sold saline-filled implants known as the "1800 Series Smooth Round Marry Implant with Leaf Valve" (hereinafter "MLV"). (Def. 56.1 Stat. ¶ 3.) Though Plaintiff originally obtained his implants from McGhan Medical Corp. ("McGhan"), by late 1994, Plaintiff's business became extremely successful and his demand for implants began to exceed McGhan's ability to supply them. In response to Plaintiff's inquiry, Michael Lawrence, a Mentor sales representative, came to New York to discuss Mentor's implants with Vitolo. (Def. 56.1 Stat. ¶¶ 13-14.)
During their meeting, Plaintiff specifically requested the MLV implant. (Def. 56.1 Stat. ¶15.) At the time, Plaintiff had begun performing breast augmentation surgery using the umbilicus technique, in which, to reduce scarring, the implant would be inserted through the patient's navel, Def. 56.1 Stat. ¶¶ 10-12, as opposed to prior techniques that involved insertion in the armpit or along the breast. (Def. 56.1 Stat. ¶ 6.) Defendant claims that Plaintiff was cautioned against use of the umbilicus technique with the MLV. (Def. 56.1 Stat. ¶¶ 8-11.) Defendant warned that the device "may be easily damaged by surgical instruments or ruptured by excessive stresses, manipulation with a blunt instrument or penetration by a needle." (Def. 56.1 Stat. ¶ 9.) Though Defendant argues that, "[b]ecause the umbilicus procedure involved the use of a surgical instrument to move the implant from the belly button to the breast, the use of this procedure was inconsistent with [its] recommendations," Def. 56.1 Stat. ¶ 10, Plaintiff argues that all methods of implantation involve contact between the implant and surgical instruments, and that Defendant's warning therefore did not serve as a warning specifically against the umbilicus technique. (Pl. 56.1 Stat. ¶ 10.) Furthermore, Plaintiff argues that Defendant knew of and condoned the umbilicus procedure and recruited him knowing that it was his procedure of choice. (Pl. Mem. of Law Ex 36 (Vitolo Aff.) ¶ 7.)
The parties entered into an agreement whereby Defendant supplied Plaintiff with MLV implants. After Vitolo's patients experienced a total of 19 deflations within four months, Defendant exchanged the MLV implants for the Mentor 1600 Series Diaphragm Valve implants and began investigating the "unusually high" number of deflations that Plaintiff's patients suffered. (Def. 56.1 Stat. ¶¶ 19-21.) Pat Altavilla, Mentor's Executive Vice President of Marketing ("Altavilla") hypothesized that the umbilicus procedure was related to the number of deflations. (Def. 56.1 Stat. ¶ 24.) Plaintiff disputes this allegation, pointing out Defendant's failure to perform any scientific studies or analyses in support of this hypothesis. (Pl. 56.1 Stat. ¶ 24.)
Thereafter, in mid-1995, Altavilla traveled to New York to observe Plaintiff performing the umbilicus procedure. (Def. 56.1 Stat. ¶ 26.) The night before the surgery, Plaintiff and Altavilla went to dinner at a restaurant. Unbeknownst to Altavilla, Plaintiff was tape recording their conversation. (Def. 56.1 Stat. ¶ 26.) During the dinner conversation, Plaintiff was adamant that the umbilicus procedure was not responsible for the high number of deflations. (Ex 7 to Def. 56.1 Stat. at 39-43.) Altavilla encouraged Plaintiff to go to Dallas, Texas, to reproduce the surgery for the benefit of Defendant's engineers, who would presumably study and determine the cause of the deflations. (Id. at 44-46.) Plaintiff never went, explaining that "that's what [Altavilla] offered but it never came to pass. It's just like me inviting you to dinner to be polite but you never get taken out to dinner." (Pl. 56.1 Stat. ¶ 33.)
The MLV came with a product replacement policy, providing that Defendant would provide a free replacement device and up to $1,000 in reimbursement for hospital and anesthesia fees. (Def. 56.1 Stat. ¶ 16.) Plaintiff argues that the offer for reimbursement was illusory, as it was conditioned upon patients signing a general release absolving Mentor for any tort liability, which patients were predictably reluctant to do. (Pl. 56.1 Stat. ¶ 16.) Nevertheless, after Plaintiff read a magazine article denouncing the umbilicus technique, he asked Altavilla to prepare a letter informing patients that Defendant would continue to honor its product replacement policy for patients who elected implantation using the umbilicus technique. (Def. 56.1 Stat. ¶¶ 34-5.) By this time, Plaintiff no longer used the MLV implant in new surgeries, though prior patients continued to complain of deflations thereof. (Def. 56.1 Stat. ¶¶ 36-7.)
Defendant conducted an investigation of the MLV implants, and discovered, inter alia, that an increased rate of deflation occurred when the implants were "autoclaved" (steam sterilized prior to implantation). Defendant issued a "Dear Doctor" letter on September 1, 1995, in which physicians were advised of the dangers of autoclaving, as well as Defendant's finding that deflation could also occur when the MLV was implanted with the umbilicus procedure. (Def. 56.1 Stat. ¶¶ 46-47.) Plaintiff argues that the "Dear Doctor" letter is misleading, in that autoclaving a sterile implant prior to implantation is a rare event. (Pl. 56.1 Stat. ¶ 46.) Plaintiff alleges that Defendant knew the implants were defective but feared a public relations nightmare. (Pl. Mem. of Law Ex. 20.) As a result, Plaintiff argues, Defendant sent a copy of the "Dear Doctor" letter to the Food and Drug Administration ("FDA"), prompting a Class II recall (which does not require manufacturers to physically recall the product). (Def. 56.1 Stat. ¶ 48.) Despite the fact that this was not the type of recall that required Defendant to take the product off of the market altogether, Defendant nevertheless discontinued the MLV and destroyed its entire inventory. (Def. 56.1 Stat. ¶ 50.)
Plaintiff alleges that Defendant misrepresented the failure rate, inducing him to purchase the MLV implants. Plaintiff argues that Defendant knew the product contained defective valves, which, Plaintiff implicitly argues, is why Defendant destroyed $2 million worth of implants following the recall. (Pl. 56.1 Stat. ¶¶ 51-53.) Plaintiff filed the instant complaint (the "Complaint") in the Supreme Court of Richmond County on February 11, 1998, stating causes of action for negligence, breach of contract, fraud and fraudulent misrepresentation, and a violation of New York's General Business Law § 349 and on April 14, 1998, Defendant filed a Notice of Removal. On June 4, 2002 and March 8, 2006, the parties signed stipulations dismissing Plaintiff's negligence and breach of contract claims, respectively. What remains are Plaintiff's claims of fraud and fraudulent inducement and Plaintiff's claim under New York's General Business Law § 349, and Defendant seeks summary judgment on each of those claims.
Summary judgment is appropriate where "there is no genuine issue as to any material fact." Fed. R. Civ. P. 56(c). "A fact is 'material' for these purposes if it 'might affect the outcome of the suit under the governing law." Holtz v. Rockefeller & Co., 258 F.3d 62, 69 (2d Cir. 2001) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986)). To be "genuine," an issue of fact must be supported by evidence "such that a reasonable jury could return a verdict for the nonmoving party." Holtz, 258 F.3d at 62. Because the moving party bears the burden of showing that there are no genuine issues of material fact, Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986), "a court must resolve all ambiguities and draw all reasonable inferences against [it]." Alston v. New York City Transit Authority, 2003 U.S. Dist. LEXIS 21741, *4 (S.D.N.Y. 2003) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986)).
A. Section 349 of New York's General Business Law
"Section 349 of the General Business Law was intended to be a consumer protection statute." Teller v. Bill Hayes, Ltd., 213 A.D.2d 141, 145 (N.Y. App. Div. 1995). "In fact, prior to 1980, only the Attorney General could prosecute an action pursuant to General Business Law § 349." Id. "The typical violation contemplated by the statute involves an individual consumer who falls victim to misrepresentations made by a seller of consumer goods usually by way of false and misleading advertising." Genesco Entertainment v. Koch, 593 F. Supp. 2d 743, 751 (S.D.N.Y. 1984). "The statute was meant to empower consumers; to even the playing field in their disputes with better funded and superiorly situated fraudulent businesses. It was not intended to supplant an action to recover damages for breach of contract between parties to an arm's length contract." Teller, 213 A.D.2d at 148. "The goals of GBL § 349...were major assaults upon fraud against consumers, particularly ...