Arizona AG accuses cord blood bank of deceptive practices

PHOENIX — Arizona Attorney General Kris Mayes on Tuesday filed a lawsuit against one of America’s biggest “cord blood banking companies” for predatory practices toward parents and their newborn children at its Tucson facility, a press release announced.

Mayes alleged Cord Blood Registry Systems, Inc. (CBR), which exists primarily to preserve “umbilical cord blood” after a baby’s delivery, did not follow through on promises and “put the integrity of those samples at risk.”

“Families put their trust in CBR at a deeply personal and emotional moment — the birth of a child — believing they were making a responsible, potentially life-saving investment in their baby’s future,” Mayes said in the release. “Instead, our complaint alleges that CBR deceived parents about the potential uses and viability of their child’s cord blood and tissue while quietly paying kickbacks to doctors who recommended its services. This is consumer fraud at its worst.”

According to Mayes’ lawsuit, CBR did not ship the cord blood samples with “strict temperature controls or monitoring.” This left the samples at risk of contamination — and in some cases completely “unusable” — after CBR claimed they would be securely transferred to its 80,000-square-foot lab in Tucson.

The largest private “newborn stem cell bank,” according to CBR’s website, also allegedly trashed public competitors as “inferior” and “unreliable” to steer parents away from potentially less expensive alternatives for cord blood storage.

Besides putting down public companies, CBR promised various incentives to its customers for their business, such as free lunches and reimbursements of up to $700 per blood sample. Mayes said CBR used obstetricians and gynecologists as “medical endorsement” for their marketing tactic, but did not disclose the medical personnel were receiving payment for their services.

“New parents should be able to rely on their doctors to provide unbiased advice, not steer them toward a company that is secretly paying for their recommendation,” Mayes said.

The lawsuit is asking for restitution for all victims and could penalize CBR up to $10,000 for each “willful violation” of the Arizona Consumer Fraud Act.

Mayes recently joined a nationwide coalition of attorney generals in filing a lawsuit against federal agencies to stop mass firings of federal probationary employees.

Related

Arizona AG files lawsuit to stop mass firings of federal probationary employeesEtsy business agrees to pay nearly $32,000 to settle Arizona consumer fraud caseKris Mayes hopes Arizonans impacted by Trump's downsizing efforts can help lawsuitsMesa industrial property sells for $5.25 millionSen. Mark Kelly believes Trump would hit ‘reset button’ on Iran war if he could, offers solution3 dead, 1 injured following Gilbert stabbing and officer-involved shooting