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As Surrogacy Becomes More Popular, Legal Problems Proliferate

Posted Mar 1, 2011 6:40 AM CDT
By Mark Hansen

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Illustration by James Steinberg

Like many couples, R.W.S. and B.C.F. wanted a child of their own. But the couple—in this case two gay men from Minneapolis—had ruled out adoption, which left surrogacy their only viable option.

So the two men did what so many others in their position have done: They turned to the Internet.

On the website of Surrogate Mothers Online, a volunteer-run support group for the surrogacy community, they came across a posting from a Minneapolis-area woman offering her services as a surrogate. Before long, the couple entered into a contract with the surrogate and paid her an undisclosed fee for her services. Through medical science, the woman soon became impregnated with a baby from R.W.S.' sperm and her own egg.

Nine months later the surrogate gave birth—first, to a healthy baby girl, then to litigation.

At first, everything went smoothly between the new fathers and their surrogate. After the baby girl was born, the surrogate visited the newborn at the men's home, and the nonbiological father proceeded with his plans to adopt the little girl, which was to have included a voluntary termination of the surrogate's parental rights.

Then, seemingly out of the blue, about a month after giving birth to the girl, the surrogate—identified in court records only as E.A.G.— showed up unannounced at the couple's front door with her father, young son and another surrogate in tow. She proceeded to tell the two men she had changed her mind about giving up the baby and wanted the girl back.

Sound familiar? Surrogacy first entered the collective public conscience almost 25 years ago when Mary Beth Whitehead reneged on her promise to give up all parental rights to Baby M, the daughter for whom she served as a surrogate for a New Jersey couple.

The Baby M case provoked such an outcry in some quarters over concerns about "baby selling" and the possible exploitation of poor women that a number of states enacted bans on surrogacy.

Such concerns have eased somewhat with the growing acceptance and popularity of in vitro fertilization and other types of assisted reproductive technologies that allow a surrogate to bear and give birth to a child she has no genetic or biological connection to, using embryos created in a lab with donated eggs and sperm.

Those procedures, which have opened the possibility of parenthood to a variety of people who can't have children of their own—single people, people with medical issues or infertility problems, same-sex couples and other nontraditional families—have become the new norm in surrogacy arrangements.

Such advances have helped turn the science of making babies into a $3 billion-a-year industry, according to Harvard Business School professor Debora Spar in her 2006 book, The Baby Business: How Money, Science and Politics Drive the Commerce of Conception. The demand has spawned a proliferation of new businesses, including fertility clinics, surrogacy agencies, and online brokers specializing in matching Indian- or Ukrainian-based surrogates with prospective U.S. parents or U.S.-based surrogates with would-be parents in other parts of the world where surrogacy is illegal.

Lawyers who practice in the surrogacy arena say the Baby M case—as well as the Minnesota case—are the exceptions. Most cases, they insist, go smoothly and according to contract. Surrogacy has become so commonplace, in fact, that a host of boldfaced names from Elton John to Sarah Jessica Parker and Nicole Kidman have all publicly acknowledged using surrogates to birth babies for them. The publicity has helped make the process more acceptable as a viable alternative to childbirth.

But surrogacy also can be a minefield. The industry is largely unregulated. And the law in many places has failed to keep pace with the revolution in assisted reproductive technology, making the process a potentially perilous one for the unwary or the unwise.

Reliable figures on surrogacy are hard to come by. No government agency or private group tracks surrogate births, though estimates range from several hundred to a few thousand per year. By one account, about 22,000 babies have been born through surrogacy in this country since the mid-1970s.

Some practitioners say they suspect the actual number is far higher. San Diego lawyer Theresa M. Erickson, who specializes in third-party reproduction and runs her own surrogacy agency, says her office alone handles about 150 such cases a year. And one of her colleagues on the East Coast does nearly as many.

But as medical science continues to push the envelope forward, making the process of having a baby via methods other than that intended by nature accessible to all, the legal issues are multiplying.

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Illustration by James Steinberg

A CRAZY QUILT OF LAWS

The United States, unlike many countries, has no national policies governing assisted reproductive technology, including surrogacy. And state laws vary widely from one state to the next. Several states expressly prohibit it, declaring all such agreements void and unenforceable as a matter of public policy. A few even make it a crime to pay for surrogacy. Other states allow it but restrict its use to married couples or to cases in which at least one of the intended parents has a genetic link to the child. And a handful of states have been very open to the use of reproductive technology and have allowed it to flourish.

But a majority of states, including Minnesota, have no laws directly addressing surrogacy, leaving many such arrangements in legal limbo and raising a number of vexing social, legal and ethical issues involving parenthood, the best interests of children, and the rights of same-sex couples and other nontraditional families for the courts to resolve.

Another big issue when it comes to surrogacy is cost. Done with the help of lawyers, doctors, psychologists, facilitators and other professionals, a surrogacy can cost upwards of $100,000, including medical expenses and health insurance. And questions persist about who is responsible for the bills.

Many health insurance policies specifically exclude maternity coverage for surrogates. And some reserve the right to seek reimbursement from the intended parents for any maternity benefits paid on the surrogate's behalf.

At least 14 states currently require some types of health insurance plans to include coverage of certain infertility services, according to a report by the Center for American Progress, a liberal research group. But in some of those states, the mandate applies only to married couples or to couples who use their own eggs and sperm. And most of the 14 contain language that implicitly excludes coverage for single people and gay, lesbian or transgender couples.

The insurance picture may be changing, however.

Last July, the Wisconsin Supreme Court held that insurance companies doing business in that state may not deny routine pregnancy services to surrogate mothers based solely on the means by which they became pregnant or their reasons for doing so.

In its decision, apparently one of first impression, the Wisconsin court said state law allows an insurer to exclude or limit certain services and procedures, as long as the exclusion or limitation applies to all policyholders. But it doesn't allow insurers to make routine maternity services that are generally covered under its policies unavailable to a specific subgroup of insureds, namely surrogates.

While the ruling applies only to Wisconsin insurers, experts say, the same argument could be made in other states where insurers routinely exclude maternity coverage for women serving as surrogates.

Such harsh economic realities are pushing many would-be parents—like the Minnesota couple—to try to cut corners and go the do-it-yourself route. This pro se mentality—which surrogacy lawyers say is on the rise—most often results in surrogacy agreements that break down, frustrate the parties' intentions and wind up in court, experts say.

R.W.S. and B.C.F.'s legal battle with their surrogate has been going on for almost as long as their daughter, now 3, has been alive.

After two years of legal wrangling, the matter ended up in a Minneapolis court, where a judge sided with the two men. In 2009 after a 10-day bench trial, the judge held that the two men—and not the surrogate—were the girl's legal and biological parents, and awarded them sole legal and physical custody, saying it was in the child's best interests.

The decision is believed to be the first time a court has held, under the Uniform Parentage Act, that a surrogate is not the mother of a child she gave birth to using her own egg. The Uniform Parentage Act has been adopted by many states, and the Minnesota decision caused a big stir in the reproductive law community.

"The courts, for the most part, are not going to disenfranchise a surrogate who gives birth to her own biological child," says Golden Valley, Minn., lawyer Suzanne Born, who represents the two fathers. "That's where this case departs from the norm."

Last October, an appellate court reversed the trial court's determination of parentage, though it affirmed that part of the lower court's decision awarding R.W.S. sole legal and physical custody of the girl.

PERILS OF THE D.I.Y. APPROACH

The dispute over the Minnesota girl—while unusual, experts say—also serves as a cautionary tale about the potential perils of do-it-yourself surrogacies in a largely unregulated market, where high costs and a patchwork of conflicting laws are the norm.

Steven H. Snyder, a Maple Grove, Minn., lawyer, chairs the ABA Family Law Section's Assisted Reproductive Technologies Committee. He says that, despite tales of woe like the Minnesota case, most surrogacies are problem-free. "That evidences what seems to me to be a pretty reliable process," Snyder says.

"Done carefully and correctly, it's a wonderful thing," says New Rochelle, N.Y., lawyer Elizabeth Swire Falker, the so-called Stork Lawyer, who has an adoption and reproductive law practice and provides infertility treatment consulting.

Even if the Minnesota case is an exception, lawyers who practice in this area see more clients going it alone, leaving them to come in and try to clean up when things go awry.

Born, who specializes in adoption and assisted reproduction law, is—like everybody connected with the case —under a gag order. But she says this situation is an example of what not to do when it comes to surrogacy.

"I don't think they realized what they were getting into" until it was too late, she says of her clients.

Because a typical surrogacy can cost between $80,000 and $120,000, some prospective parents try to save money by cutting costs and eliminating the services of an agency—which can add $20,000 or more to the overall tab.

But finding a surrogate online through a mass clearinghouse for surrogates, as R.W.S. and B.C.F. did, is usually not a good idea, experts say, because there is no way to be sure of the qualifications, suitability or reliability of the surrogates who are offering their services there.

A reputable agency, on the other hand, will not only carefully screen and prepare potential surrogates for the process but also manage all of the medical, psychological, legal, financial, insurance and administrative details that go along with such an arrangement.

Of course, not all agencies are created equal.

Anybody with a website, a post office box and a telephone number can open an agency and start accepting clients. Some agencies operate as little more than glorified matchmaking services. Others offer a range of surrogacy-related services and adhere to practice and ethical guidelines promulgated by the American Society for Reproductive Medicine.

The industry has been rocked by several recent scandals. One of the biggest to date was the collapse of SurroGenesis, a Modesto, Calif.-based agency that abruptly closed its doors in March 2009, leaving dozens of pregnant surrogates and expectant parents in the lurch and millions of dollars in client funds unaccounted for.

The collapse of SurroGenesis and an affiliated escrow company that was supposed to be safeguarding client funds has led to a class action lawsuit against company officials and ongoing investigations by the FBI and the U.S. Postal Service. It also prompted the ABA committee Snyder heads to begin drafting model legislation to regulate the industry, though that effort is still a work in progress.

STEPS TO CONSIDER

Snyder and other lawyers who specialize in adoption and surrogacy law say they're not necessarily opposed to working with a client who wants to arrange his or her own surrogacy, as long as the client fully understands and is willing to accept the risks that come with it. But there are certain steps in the process that should be followed even if no agency is involved, they say.

One is a thorough screening of the surrogate and a complete disclosure of life facts and circumstances between the parties. Such a screening serves to educate the surrogate on relevant issues and evaluate her ability to complete the process as intended. A criminal background check, thorough medical history and analysis of any available insurance coverage should also be undertaken.

Some experts recommend that the intended parents also be screened, which could identify issues that might prevent the surrogate from keeping her end of the bargain: a history of mental illness, a criminal record, or evidence of domestic violence or child abuse. But others don't believe the intended parents should be subject to any screening since parents who are capable of having their own children aren't subjected to any screening beforehand.

Born says she has nothing against Surrogate Mothers Online, the information and support group that operates the website where her clients found their surrogate. Her chief concern is that nobody there is evaluating the women who advertise their services as surrogates, which might have revealed that E.A.G. would end up changing her mind.

Kymberli Barney, a mother of four who moderates a discussion list for Surrogate Mothers Online and once served as a surrogate, says there are definite advantages to working with a reputable agency. But, she argues, an agency is not always necessary. "In truth, there isn't anything an agency can do for an individual that the individual can't do for himself," she says.

R.W.S. and B.C.F.'s second big mistake, Born and other experts say, was to agree to a traditional surrogacy arrangement with a woman they didn't know and to whom they weren't related. Though a traditional surrogacy (defined as one where the surrogate is also the biological mother) is simpler and less expensive than a gestational surrogacy (where the surrogate has no biological ties to the child she is carrying), it presents a much greater legal risk for the intended parent(s) if the surrogate changes her mind.

"A woman who gives birth to a child using her own egg is legally presumed to be the child's mother wherever she is," says Nidhi Desai, a Chicago lawyer who specializes in adoption and reproductive technologies.

That's why many lawyers who do such cases for a living are reluctant to get involved in a traditional surrogacy unless the parties are closely related or good friends and know exactly what they're getting into. Some practitioners say they won't handle a traditional surrogacy arrangement under any circumstances.

"I wouldn't touch one with a 10-foot pole," says Falker, the New York lawyer.

Even Barney concedes that it takes a certain frame of mind to serve as a traditional surrogate, one she doesn't happen to have. "I view anybody born from my egg to be my child, so that's not something I would be able to do," she says.

R.W.S. and B.C.F.'s third big mistake, according to lawyers in the field, was to enter into a surrogacy agreement in a state like Minnesota, where the legality of such an arrangement is uncertain, without any input or advice from a lawyer who knows the lay of the land.

The same goes for the Minnesota surrogate, who also should have been represented by competent, independent legal counsel to help ensure that she—and her husband, if she were married—understood and appreciated all of the issues set forth in the agreement and was proceeding with the arrangement voluntarily and without any coercion or undue influence.

IN SEARCH OF A STANDARD

In an effort to bring order to the current chaos, some experts have called for a uniform federal law governing surrogacy. Such a standard would prevent forum-shopping for states with more favorable surrogacy laws—which reduces the bargaining power of individual surrogates; draws prospective parents from all over the country with the promise of easy, risk-free transactions; and allows agencies to get around the most restrictive state laws.

Another option would be to encourage more states to adopt Article 8 of the Uniform Parentage Act, which specifically addresses surrogacy agreements. Article 8, which is optional to enacting states, treats a surrogacy agreement, which it calls a "gestational agreement," as a significant legal act that should be approved by a court in a process similar to an adoption proceeding.

Under Article 8, a version of which apparently only two states have so far adopted, a court has to verify the birth mother's qualifications to carry a child and the intended parents' qualifications to be parents. It also says that a birth mother may be compensated for her services and has the power to terminate the agreement.

The act also stipulates that surrogacy agreements not approved by a judge are unenforceable, which provides a strong incentive for the parties to seek judicial scrutiny, and that prospective parents who enter into an unapproved surrogacy agreement and then refuse to adopt the resulting child may be liable for child support.

In 2008, the ABA adopted a model act governing assisted reproductive technologies, including surrogacy. The model act, which was 20 years in the making, is designed to provide a flexible framework by which issues such as parentage, informed consent, mental health consultation, privacy and insurance can be approached and resolved.

The model act proposes two alternative ways of handling surrogacy arrangements: One would require a judge's pre-approval of any surrogacy agreement in which neither of the intended parents has a genetic link to the resulting child; the other, an administrative model, would require no judicial involvement as long as at least one of the intended parents has a genetic link to the resulting child and all of the parties submit to eligibility and procedural requirements—including a mental health evaluation, a legal consultation and health insurance coverage.

But the ABA's efforts so far have fared even worse than Article 8 of the Uniform Parentage Act has in terms of state legislative acceptance, leaving many such arrangements in legal limbo for the time being.

At the moment, the Minnesota couple, R.W.S. and B.C.F., are still in that limbo, but they currently appear to hold the upper hand. The surrogate appealed the unfavorable court ruling to the Minnesota Supreme Court, which in mid-January denied her petition for further review. And while the surrogate is expected to take her case to federal court, the federal courts generally don't get involved in custody disputes that don't raise diversity or constitutional issues.

And according to court records, the young girl still lives with her two dads, whom she recognizes as her parents, in their Minneapolis home—the only home she has ever known.

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