Surrogacy: American Style

Chapter 10
Surrogacy: American Style

In a classification of countries as liberal, prohibitive or cautious toward assisted reproduction, from an outsider’s perspective the United States might well rank as ‘laissez-faire’, a classification reserved for countries with almost no regulation.¹ But in actuality, at least as regards surrogacy, the form of assisted reproduction in which a woman agrees to gestate an embryo and give birth to a child for another person or couple, the regulatory situation is somewhat more complex. It is true that no federal law addresses surrogacy, but this is partly a function of the fact that legislative competence in the areas of access to surrogacy and the legal parentage determinations that flow from it currently lies with the states by virtue of the Tenth Amendment to the United States Constitution.² In a union made up of 50 states,³ we find a wide variety of surrogacy regulation, ranging from prohibitive to permissive. This wide-ranging regulation reflects the fact that Americans have never been of one mind about surrogacy, whether commercial or altruistic, traditional or gestational. Viewing the regulation of surrogacy in the United States from this perspective reveals that, instead of being monolithically laissez-faire, the United States stands as a microcosm of the rest of the world, with the whole range of global attitudes towards surrogacy subsumed within its borders.

This chapter is presented in eight parts. Parts II and III provide a legal and historical backdrop to the regulation of surrogacy in the United States. Parts IV, V and VI explore how surrogacy is regulated according to different models running along the continuum from prohibitive to permissive. These parts cover both the regulation of who may have access to surrogacy, the parentage ramifications flowing from surrogacy arrangements, and financial matters such as taxation, insurance and consumer credit. Part VII trains a normative lens on the practice of surrogacy with a special emphasis on recent empirical work and a call for the dismantling of discriminatory barriers to the creation of families through surrogacy. Part VIII consists of a brief conclusion.

Regulation of surrogacy in the United States runs the gamut from laws that impose criminal sanctions or prohibit enforcement of surrogacy contracts to laws that permit surrogacy within limits. In 2015, nearly half of the states have some legislation relating to surrogacy,⁴ with the most recent legislative enactments having explicitly permitted the practice. Some jurisdictions have only case law governing surrogacy contracts,⁵ and some states have no binding regulation at all.⁶ Model laws on the subject, drafted to bring some legal uniformity to the area, have had limited success.⁷

The laws that exist seek to answer two primary questions: first, whether surrogacy should be permitted at all and, second, if permitted, within what limits. In contrast to Australia, laws imposing criminal sanctions for violations of restrictions on surrogacy are quite rare in the United States. States that discourage surrogacy generally have a statute declaring surrogacy contracts void and unenforceable. Such statutes make it difficult for the parties to a surrogacy agreement to achieve their aim without resorting to an adoption, but do not ban surrogacy per se. States that permit surrogacy determine whether the surrogate may be ‘compensated,’ meaning paid a fee beyond the reimbursement of her expenses.⁸ Permissive states may also impose specific restrictions on access to surrogacy and regulate its parentage ramifications.⁹

III. Historical Context

No discussion of surrogacy regulation in the United States is possible without reference to America’s most notorious surrogacy case, In re Baby M. This New Jersey traditional-surrogacy dispute arose between a professional couple, Bill and Elizabeth Stern, and a working-class married surrogate with two children, Mary Beth Whitehead, who agreed to submit to artificial insemination and surrender the baby to the Sterns for $10,000. Whitehead, desiring to retain custody of Baby M., was sued by the Sterns, who prevailed at the trial court level.¹⁰ In a breathtaking decision that described Mary Beth Whitehead as emotionally unstable,¹¹ the Sterns as devoted parents,¹² and surrogacy as a fundamental constitutional right,¹³ Judge Harvey Sorkow declared that the contract would be specifically enforced via the termination of Whitehead’s parental rights¹⁴ and the grant of Elizabeth Stern’s petition to adopt the child.¹⁵

The Supreme Court of New Jersey reversed on the question of the surrogacy contract’s validity. The court viewed the case not as one of disputed parentage, since Whitehead and Bill Stern were indisputably Baby M.’s progenitors, but of disputed custody.¹⁶ In the course of its unanimous and lengthy decision, the court reflected on the similarity between surrogacy and adoption. Because of the similarity, the court was unwilling to countenance, in contravention of adoption law, paying for the irrevocable consent to relinquish a child. The court objected as well to the attempted usurpation of the judiciary’s parens patriae authority via a contract purporting to name the custodian of a child in advance of its birth. The court did agree with Judge Sorkow’s custody analysis, however. Bill Stern was granted custody, and the case was remanded for a determination of Whitehead’s visitation rights.¹⁷

The question of procreative liberty seemed a simpler matter. To Bill Stern’s insistence on his constitutional procreative freedom, the court responded that whatever procreative liberty was involved had not been infringed. After all, Stern had had a child with Whitehead. If by raising procreative liberty Stern was trying to argue that he was the child’s father but Whitehead was not the child’s mother, he, quite simply, had it wrong. ‘The custody, care, companionship, and nurturing that follow birth’, asserted the court, ‘are not parts of the right of procreation’.¹⁸ In other words, exercises of procreative liberty do not resolve parentage questions, which require the evaluation of ‘different interests’ than the ‘essentials’ of procreative freedom. Those different interests, it turns out, are the state’s interest in the protection of children, an interest that for parentage matters requires an assessment of which one of the disputants has ‘demonstrated commitment to the responsibilities of parenthood’.¹⁹

Baby M. was, in Carol Sanger’s estimation, ‘the custody trial of the twentieth century’.²⁰ It ignited a firestorm of controversy while it was being litigated, briefly made allies of feminists and conservative Catholics, and triggered a spate of criticism characterising surrogacy as exploitative and violative of prohibitions on baby selling.²¹ On the policymaking level, there is no mistaking that the ‘moral panic’²² engendered by Baby M. was the catalyst for three bills at the federal level²³ and restrictions on surrogacy in several states, which, like the court in Baby M., declared themselves unwilling to carry out the terms of contracts governing the bringing into existence of a child ‘by conscious pre-arrangement’.²⁴ In spite of the sentiments that inspired them, though, these provisions did not uniformly criminalise or otherwise outlaw surrogacy. At least one other state supreme court had at the time of the decision in Baby M. made a convincing distinction between surrogacy and adoption,²⁵ and the Baby M. court itself similarly did not altogether disapprove of surrogacy, at least where it was unpaid and where the surrogate was not bound to an agreement to surrender the child.²⁶ These understandings of how surrogacy would best work may have been drowned out by the anti-surrogacy turmoil that arose from Baby M., but they did resurface after the dust settled around 1992, the year Elizabeth Scott describes as ‘the political high water mark of the anti-surrogacy movement’.²⁷

Baby M. is remembered by many as a case that forced the tide of opinion against surrogacy. The jurisdictions that enacted statutes disapproving of surrogacy in the wake of Baby M. included Arizona,²⁸ Louisiana,²⁹ Michigan,³⁰ New York,³¹ Utah, and the District of Columbia.³² These early anti-surrogacy provisions have undergone challenges and changes in the intervening years. The Arizona law has since been declared unconstitutional as applied to deny a genetic mother an opportunity to prove her maternity but otherwise remains in force.³³ Utah has since legalised compensated gestational surrogacy,³⁴ and bills to relax restrictions on surrogacy are currently pending in New York and the District of Columbia.³⁵ Despite these legal developments, Baby M. is far from a relic. It remains controlling law in New Jersey, where it was decided and where it was judicially clarified several years later as extending to gestational surrogacy.³⁶ It was the template for a more recent case involving a gay male couple and a surrogate who conceived using the egg of a donor.³⁷ A New Jersey court decided another gestational surrogacy case similarly in 2009, finding the intent of the parties in entering into the arrangement and the lack of genetic connection between the surrogate mother and the child to be ‘distinctions without a difference’ to the larger considerations in play.³⁸ This sense that there is no difference between traditional and gestational surrogacy may well have influenced Governor Christie’s veto of legislation that would have created a regulatory framework for gestational surrogacy arrangements in New Jersey.³⁹

What might seem remarkable, given what seem to be its powerful anti-surrogacy sentiments, is that New Jersey, in the aftermath of Baby M., did not outlaw surrogacy. Today, the objectives of a surrogacy arrangement may be realized within an adoption framework. The bill vetoed by Governor Christie would have permitted the automatic recognition of intended parents in gestational surrogacy cases. In a related development, an equally divided New Jersey Supreme Court, in a decision that surprised many, approved the state’s refusal to place the intended mother’s name on the child’s birth certificate, where neither the surrogate nor the intended mother had a genetic connection to the child.⁴⁰ For the time being, at least, adoption law will remain the governing legal framework for surrogacy in New Jersey.

There are also shades of Baby M. in other jurisdictions. The availability of gestational surrogacy, discussed in Part V, has been influential in winning converts to surrogacy, but discomfort with traditional surrogacy continues to be reflected in the laws of several states where gestational surrogacy is permitted but traditional surrogacy is not.⁴¹ In still other states, courts have treated the controlling issue in traditional surrogacy matters as being custody rather than parentage.⁴²

Today there is very little legislative activity aimed at prohibiting surrogacy. The legislative trend, if there is one, is toward legalising surrogacy where it has been illegal,⁴³ or providing a statutory framework for it where it has been practised with minimal legislative guidance.⁴⁴ Recent attempts to enact prohibitions on surrogacy or to limit it to altruistic arrangements, both of which are reflected in the laws of many other countries, have met with little success. A recent proposal in South Dakota, for example, would have vested parental rights in any surrogate mother, whether gestational or traditional and whether or not she received compensation. Harold Cassidy, the lawyer who represented Mary Beth Whitehead in Baby M., testified in favour of the measure, which ultimately was voted down in committee.⁴⁵ A similar fate befell a bill brought in Kansas to criminalise paid surrogacy. After overwhelming testimony in opposition to the measure and statements by the senate leadership to the effect that there was little support for it, the sponsoring senator withdrew the bill.⁴⁶

IV. ‘Bans’ on Surrogacy

A true ban or prohibition on surrogacy makes surrogacy illegal by either declaring it to be prohibited or imposing penalties upon those who would enter into or assist with such arrangements.⁴⁷ Banning surrogacy whether or not compensation changes hands, however, is not by and large the regulatory stance that states discouraging surrogacy have taken. Some of these jurisdictions have affirmatively banned compensated surrogacy,⁴⁸ but what is more common is legislation that may appear to be a prohibition of surrogacy but is in fact merely a declaration that surrogacy contracts are void and unenforceable.⁴⁹ This ‘passive resistance’, as Radhika Rao describes it,⁵⁰ applies in some states only to traditional surrogacy or to compensated traditional surrogacy.⁵¹ Such laws are not bans in the true sense, since they merely force the parties to resort to an adoption to finalise the parentage designations they desire. As a practical matter, parties remain free under such laws to pre-arrange the creation of a child in precisely the way surrogacy contemplates, but adoption law does not. And though a court will refuse to enforce any provision of the contract if a dispute arises, as long as the parties continue to agree, they can invoke adoption law to help them fulfil their aims.

This ‘adoption model’ of surrogacy prohibits paying the birth mother compensation for her inconvenience and amounts in excess of her expenses and gives her an opportunity to keep the child. It asks that we remove the taint of payment for the surrender of a child from the arrangement, not that we disallow the arrangement entirely. This model appears particularly appropriate for traditional surrogacy cases and has been embraced by some states. Florida, for example, has a statute regulating ‘pre-planned adoption contracts’ in precisely this fashion.⁵² New Hampshire’s statute employs an adoption model for all surrogacy cases, allowing the surrogate to keep the child if she chooses to do so within 72 hours after the birth of the child.⁵³ A New York court, before the legislature enacted a ban on surrogacy, required the surrogate to testify under oath that she would not accept compensation beyond expenses, given the prohibition on compensation for adoption.⁵⁴

Intended parents admittedly do not expect to have to adopt the child when they enter a surrogacy arrangement. They want the assurance that they will be legally recognised as the child’s sole parents immediately upon its birth and not after the birth mother has made up her mind not to keep the child. Nonetheless, adoption law has been looked to in both anti- and pro-surrogacy jurisdictions as an important set of default principles either for justifying a ban or for shaping the regulation of surrogacy. It is apparent that adoption law has had an important influence on the development of laws regulating surrogacy in the United States, even as American attitudes toward surrogacy have softened.

The national tone in the United States has changed since Baby M.,⁵⁵ and so has the practice of surrogacy. Today, gestational surrogacy is strongly preferred over traditional surrogacy, in part because the lack of any genetic connection to the child appears to ease a gestational surrogate’s post-birth separation.⁵⁶ There is also less of a sense that a gestational surrogate is receiving money to relinquish her child but is instead providing gestational services for an infertile couple.⁵⁷ Finally, testimonials and studies have helped underscore that surrogates are not, as a class, poverty-stricken women forced against their will to participate in an exploitative transaction. There is, thus, a greater level of comfort with gestational surrogacy among intended parents and surrogates alike. By one estimation, 95 per cent of all surrogacies that take place in the United States are gestational.⁵⁸ These developments have led to hybrid legislation, where a state chooses to ban traditional surrogacy but to permit gestational surrogacy.⁵⁹

The greater level of comfort Americans feel toward surrogacy has influenced the law in the direction of bestowing legal recognition upon the intended parents without the necessity of adoption. This approach makes sense in gestational surrogacy where the surrogate, lacking a genetic connection to the child, is not legally recognised as the mother.⁶⁰ Some courts will even issue a pre-birth judgment of parentage to this effect, which helps ensure that the intended parents’ names will appear on the child’s birth certificate in the first instance.⁶¹ This approach might be taken as well in states that allow traditional surrogacy. The procedure by which this result is achieved is not necessarily straightforward and may entail considerable governmental oversight in the form of limitations on access to surrogacy. The following 25 examples have been compiled from a review of various jurisdictions, and are typical of the requirements imposed on surrogacy arrangements:

1.   Agreements must be judicially pre-approved.⁶² A guardian ad litem must be appointed for any resulting child prior to the hearing on judicial pre-approval.⁶³

2.   Agreements must be in writing and signed by all parties.⁶⁴

3.   Agreements do not apply to pregnancies brought about by sexual intercourse.⁶⁵

4.   Only gestational surrogacy is permitted.⁶⁶ The surrogate’s husband may not contribute his sperm.⁶⁷

5.   Compensation of the surrogate is either prohibited,⁶⁸ or must be deemed reasonable or in good faith.⁶⁹ The contract must provide for adequate healthcare expenses for the surrogate.⁷⁰ No fees or commissions are permitted for brokering a surrogacy arrangement.⁷¹ A client’s funds paid to a broker must be held in escrow or in a trust account maintained by an attorney.⁷²

6.   The surrogate must have had one previous pregnancy resulting in a live birth or delivery.⁷³

7.   If she is married, the surrogate’s husband must expressly agree to the terms of the contract.⁷⁴

8.   The surrogate (or all parties) must undergo psychological counselling.⁷⁵

9.   The surrogate must have legal counselling and must document her receipt of information regarding the ramifications of the contract.⁷⁶ The intended parents must have legal counselling and must document their receipt of information regarding the ramifications of the contract.⁷⁷ The surrogate’s counsel must be separate and independent from the intended parents’.⁷⁸

10.  The surrogate must not be receiving state assistance.⁷⁹

11.  The surrogate’s husband must be a party to the contract/must join in the petition to obtain judicial validation of the agreement.⁸⁰

12.  Either the surrogate or the intended parents must reside in the state.⁸¹

13.  The surrogate and the intended parents must be 18⁸² or 21.⁸³ If a minor, the surrogate must be emancipated.⁸⁴

14.  The surrogate and the intended parents must have psychological evaluations.⁸⁵ Surrogates and intended parents must have medical examinations.⁸⁶ The surrogate and the intended parents must receive genetic counselling if the surrogate is over the age of 35.⁸⁷

15.  The surrogate mother must not have a diagnosed intellectual, mental, or developmental disability.⁸⁸ She must be in good health without conditions that could affect her pregnancy.⁸⁹

16.  The surrogate mother must have health insurance that will cover the period of her pregnancy and eight weeks postpartum.⁹⁰

17.  The intended mother must be incapable of gestating a child or not without unreasonable risk to her physical and mental health or that of the child.⁹¹

18.  At least one of the intended parents (or both of them) must contribute her gametes.⁹² Either the surrogate or the intended mother must provide the ovum.⁹³

19.  The intended parents must be married.⁹⁴

20.  The intended parents must meet the standards of parental fitness employed in adoption proceedings⁹⁵ or must be determined to be suitable parents.⁹⁶ The surrogate and her husband must meet the standards of fitness required of adoptive parents.⁹⁷

21.  The intended parents must submit to a home study.⁹⁸ The surrogate and her husband must submit to a home study.⁹⁹

22.  The physician must provide the parties with certain specified pieces of information in order that the parties be capable of giving informed consent.¹⁰⁰ Informed consent must be documented.¹⁰¹

23.  The contract may not deny the surrogate the right to make decisions to safeguard her health or the health of the foetus she is carrying.¹⁰²

24.  The intended parents must agree to accept custody of the child immediately upon his or her birth and to assume sole responsibility for him or her¹⁰³ regardless of the condition, gender or number of the children.¹⁰⁴

25.  The contract must be witnessed by two competent adults.¹⁰⁵ The contract must be notarised.¹⁰⁶

Despite what appears to be a tidy list of requirements, there is, in actuality, a great deal of variation among the states. Some states, for example, friendly though they are to surrogacy contracts, do not permit compensation over and above medical and other expenses related to the pregnancy.¹⁰⁷ Some states allow commissioning parents to be unmarried or single.¹⁰⁸ In some jurisdictions only gestational surrogacy is permitted,¹⁰⁹ making it less likely that the surrogate will refuse to relinquish the child.¹¹⁰ Making counselling and psychological evaluation available to surrogates before they embark on the journey is commonly recommended (and in some jurisdictions, required),¹¹¹ as is the mandate that the surrogate have experienced at least one pregnancy.¹¹²

The most salient feature of this regulatory approach to surrogacy is that it bars some individuals from becoming parents with the help of surrogates and bars some women from becoming surrogates. It thus sends a clear message about who is deserving of the right to resort to surrogacy. It also fixes the terms of the agreement, eliminating any sense that there is a free market for surrogacy in which freedom of contract reigns. Finally, it installs the state as a gatekeeper and arbiter of the agreement from its very inception. Recent legislation on surrogacy in the United States follows this model, but does not uniformly retain the judicial pre-approval requirement.

Dating from 1973, the Uniform Parentage Act was promulgated primarily to eliminate the differential treatment of marital and non-marital children. In its first iteration, the Act contained a section addressing the use of artificial insemination by married couples. In the 2000 overhaul of the UPA, NCCUSL added Article 8 to govern the ability of married couples to commission gestational or traditional surrogates and to establish parentage in such matters. The UPA contains a judicial pre-approval requirement, but it does not require that at least one of the intended parents be a genetic parent of the child. In the course of the judicial validation procedure, the court will verify the voluntariness of the entry of the parties into the agreement and whether they understand its terms.¹¹³ Those terms must make clear ‘which party is responsible for all reasonable health care expenses associated with the pregnancy’ even if the agreement is eventually rescinded by either party.¹¹⁴ The agreement is revocable until the gestational carrier actually becomes pregnant.¹¹⁵ After the child’s birth, upon confirmation of the parentage of the intended parents, ‘a birth certificate naming the intended parents as the child’s parents’ issues.¹¹⁶