Facts

Plaintiff Sara Gerber, with the assistance of defendant, Center for Surrogate Parenting Inc., entered into a written contract with a couple from Belgium to provide services as a surrogate mother. Upon execution of the contract and with the assistance of the defendant, the plaintiff secured a policy of health insurance which did not contain exclusion for surrogacy. Thereafter, the plaintiff underwent in-vitro fertilization procedures and became pregnant. The plaintiff suffered pre-term labor and other medical complications that required her to be on bed rest in the hospital for one month before undergoing a C-section to deliver twin babies. Approximately six weeks following the birth, the plaintiff's health insurance company wrote her to explain that it was investigating the matter to determine whether she had failed to disclose a pre-existing medical condition and/or her plans to participate in surrogacy. Ultimately, the plaintiff's insurance company decided to rescind her policy. This resulted in plaintiff becoming personally responsible for all of the hospital and other medical expenses related to the pregnancy and birth in the amount of approximately $135,000.

PLAINTIFF'S CONTENTIONS:
The plaintiff contended that she would not have agreed to become a surrogate mother but for defendant, Center for Surrogate Parenting Inc.'s repeated representations in its website and other promotional materials that it would "take care of all financial issues related to the pregnancy." The plaintiff allegedly relied upon the defendant's promotional materials that stated that it would "never allow a surrogate mother to take any financial risks." Further, the plaintiff asserted at trial that she would not have entered into the written contract with the couple from Belgium to act as a surrogate mother had she been advised by the defendant that she could, under any circumstances, ever be held personally responsible any costs associated with the pregnancy.

The plaintiff contended that the defendant was well aware of previous problems with insurance companies paying for a surrogate pregnancy and that the defendant went to great lengths to advise the couples of this fact, but never mentioned this to the prospective surrogate mothers. The plaintiff argued that the defendant was contractually bound to pay for all of the hospital and other medical expenses related to the pregnancy and birth. The plaintiff asserted that the defendant’s misrepresentations were intentional and/or negligent and it was therefore obligated to pay all of the hospital and other medical expenses.

The plaintiff asserted at trial that she had suffered emotional distress and damage to her credit history as a result of defendant’s conduct. Finally, the plaintiff asserted that the conduct of the defendant was intentional and malicious such that punitive damages should be awarded.

DEFENDANT'S CONTENTIONS:
Defendant Center for Surrogate Parenting Inc. asserted that it did not have a written contract with plaintiff and any representations on its website and other promotional materials did not constitute a contract. Although the defendant did not deny the statements, it asserted that it believed them to be true when made and that it could not anticipate that the plaintiff's health insurance company would wrongfully rescind her policy.

The defendant asserted that it protected the plaintiff by requiring that she and the couple each have independent legal counsel to review the extensive written contract that they were about to enter into. Moreover, the defendant required that the written contract between the surrogate mother and the couple state in absolute clear language that the couple assumes all financial obligations and will pay for all anticipated and/or unexpected costs. The plaintiff had independent legal counsel review the written contract and discuss all of the terms and conditions with both her and her husband. The written contract repeatedly stated that it is the couple that pays for all expenses. Nowhere in the contract, or other written materials, is there any suggestion that the defendant pays for any expenses. The defendant contended that plaintiff's insurance company wrongfully rescinded the health insurance policy, as there was no exclusion for surrogacy in the policy purchased by plaintiff. In addition, the defendant contended that it was not the proper defendant and that the plaintiff should be pursuing the couple with whom she contracted.

Damages

Unpaid hospital and other medical expenses related to the pregnancy and birth in the amount of approximately $135,000. With interest, the outstanding bills exceed $140,000.

Result

Defense verdict.

Deliberation

one day

Poll

12-0 (there was no contract between the parties), 12-0 (the defendant did not intentionally fail to disclose an important fact to the plaintiff), 12-0 (the defendant did negligently make a false representation to the plaintiff), 12-0 (the defendant had reasonable grounds for believing the representation was true when it was made)

Length

six days