"Vergara Embryo Trust Enables Forum Shopping by Ex-Fiancé"
Actress Sofia Vergara’s ex-fiancé Nick Loeb is using a trust as a procedural loophole to move the parties’ dispute over their embryos to a favorable jurisdiction. If he is successful, he will create a monumental precedent enabling litigants in embryonic disputes to have a “back door” into “pro-life” jurisdictions.
Loeb filed the case on Dec. 7 in Jefferson Parish, Louisiana, naming the embryos “Emma” and “Isabella” as plaintiffs. Loeb seeks declaratory judgment directing the embryos to be implanted in a surrogate, so that they can receive an interest in a Louisiana trust.
According to the complaint, Vergara and Loeb have cryopreserved two fertilized embryos at ART Reproductive Center (ART) in Beverly Hills, California. While at ART, the parties signed a form directive governing the disposition of the embryos. The directive states that both parties must agree how to use the embryos; otherwise, ART will destroy them.
Vergara made a handwritten change to ART’s form directive instructing the embryos to be thawed in the event of either of their deaths. Loeb alleges that he was “shocked that Vergara has chosen to kill their offspring,” but still initialed the change and signed the form directive “not believing that this provision would be ultimately applicable.”
Loeb seeks to invalidate or rescind the directive and other contracts signed at ART. He argues that the documents violate applicable law, and were fraudulently procured under duress by Vergara, who he alleges verbally and physically abused him.
Loeb initially filed a 2014 case in California seeking to preserve his parental rights, which he moved to dismiss after refusing to comply with the judge’s discovery order. Having failed in California, Loeb filed a new lawsuit in Louisiana, where he intermittently resided with Vergara.
Loeb filed the new lawsuit in a jurisdiction where he may feel more likely to obtain a favorable judgment—a practice colloquially known as “forum shopping.” Loeb seeks to take advantage of a Louisiana law stating that embryos conceived via in vitro fertilization are considered “human beings.” Louisiana law is notoriously different from other U.S. states in that the legal system derives from the French Napoleonic Civil Code, not English common law. Loeb, who is a Delray Beach resident, may also feel that he has an advantage in Louisiana because he has business ties there.
This begs the question: How was Loeb able to file a lawsuit in Louisiana regarding California contracts governing the disposition of embryos located in California, when neither party resides in Louisiana?
The complaint suggests that Loeb created a Louisiana trust, the Emma and Isabella Louisiana Trust No. 1, naming New Orleans resident James Charbonnet as the trustee. The trust provides that upon the live birth of the embryos, the trust will become irrevocable, and the assets therein will be held to pay for their health, education, maintenance, and support. Until such time, the settlor—presumably Loeb—remains the sole beneficiary.
Based on the creation of an interest in a Louisiana trust, and Louisiana law declaring the embryos “human beings,” Loeb argues that Vergara is depriving the embryos of their interest in the trust. The complaint states a claim against Vergara for tortious interference with the embryos’ inheritance.
This is a brilliant gambit. Loeb, who can rescind the revocable trust at any time before the embryos are born, has no financial risk if his case is unsuccessful. If Loeb is successful, however, the embryos may have a claim for damages against Vergara for lost interest on trust assets that they would have received were they born sooner.
In a New York Times op-ed written by Loeb and published on April 29, 2015, he seemingly concedes that a potential victory would be factually unprecedented: “My lawyers have identified 10 other cases in the United States in which a parent tried to have a fertilized, frozen embryo taken to term against the wishes of an opposing parent. In eight of those cases, the parent seeking custody lost. In the other two cases… the woman had undergone chemotherapy treatment and the embryos were her last chance to have a biological child.”
If the case survives a motion to dismiss, it potentially sets a huge precedent, since separated couples across the U.S. may be able to “forum shop” embryonic disputes to favorable “pro-life” jurisdictions by creating revocable interests in trust.
Ultimately, the court will have to decide.
Reprinted with permission from the January 10, 2017 issue of the Daily Business Review. © 2017 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.