omission of FedEx's role in embryo transport was potentially deceptive

S.W. v. Cryoport, Inc., 2025 WL 1421909, No. 8:24-cv-02212-AH-(DFMx) (C.D. Cal. Apr. 24, 2025)

Tragic facts in this consumer protection case. Plaintiffs underwent IVF treatments in 2019 to preserve their options, resulting in six cryopreserved healthy embryos. They contracted with Cryoport to have the embryos transferred from a fertility clinic in San Francisco to Irvine, California. Cryoport provided a travel tank to the clinic, clearly labeled as containing live specimens. What plaintiffs allegedly didn’t know was that Cryoport hired FedEx to physically take the package from San Francisco to Irvine; they learned that by receiving tracking alerts to FedEx. FedEx misdelivered the package to Cryoport’s logistics center, where a Cryoport employee opened the container and removed the contents; the embryos were then put back into a container and delivered to Irvine, no longer viable.

Plaintiffs sued for (1) bailment; (2) negligence and/or gross negligence; (3) violation of the California CLRA and (4) violation of the UCL. The contract’s limitations on liability to $200 applied (though not as to gross negligence); the court found that the contract limitations weren’t unconscionable or void as against public interest, though the claims otherwise survived. (Not clear to me whether CLRA/UCL claims are also governed by the contract; consumer protection laws were designed in part to avoid ordinary contractual exculpation clauses and the claims here go to whether they would have engaged in the transaction in the first place had they known the truth.)

The CLRA and UCL claims were based on omissions. “A failure to disclose a fact can constitute actionable fraud or deceit in four circumstances: (1) when the defendant is the plaintiff’s fiduciary; (2) when the defendant has exclusive knowledge of material facts not known or reasonably accessible to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations that are misleading because some other material fact has not been disclosed.”

Cryoport argued that no reasonable consumer who purchased Defendant’s standard transport services would be deceived into believing that it would physically transport the materials at issue. But plaintiffs alleged that Cryoport repeatedly identified itself as offering “transportation,” “shipping,” and “courier” services, and conveyed to consumers that it itself transports the material entrusted to it. They sufficiently alleged that the identity and participation of FedEx was material information that Cryoport was obligated to disclose, and that the omission was likely to confuse reasonable consumers; the complaint pointed to public reviews highlighting that FedEx is involved. “This indicates that a reasonable consumer would likely not understand from Defendant’s representations that it utilized FedEx for its services.”