Can You Pay Your Expert That Way?

As litigation becomes more complicated, litigants are increasingly employing experts to explain the merits of their cases or their damages. While expert testimony is not required in every case, it is often helpful to explain complicated scientific, biological, chemical, economic, or other types of topics to either a judge or a jury. Experts are frequently used in personal injury cases to discuss the damages incurred by a plaintiff and possible future medical expenses; in products liability cases to explain whether a product was or was not the cause of an injury; and in commercial cases to trace funds. However, while experts are often very helpful, they are also frequently expensive. Paying an expert to review the necessary documents, prepare a report, sit for a deposition, and potentially testify can create costs in the tens of thousands of dollars. Moreover, a case could require multiple experts examining different aspects of the elements of a case. With this, litigants may look for alternative ways to pay for experts rather than simply on an hourly basis.

It might, therefore, seem like a good idea to ask an expert to be paid on a contingency basis. After all, a party’s attorney can be, so why not an expert? While lawyers are free to take on cases on a contingency basis, the same is not true for experts. In fact, courts have held it is improper for an expert to be paid on a contingency basis and have used this as a basis for disqualification of an expert. The Fourth Circuit has held that it is improper to pay an expert witness a contingent fee. Accrued Fin. Servs., Inc. v. Prime Retail, Inc., 298 F.3d 291, 300 (4th Cir. 2002). Endorsing the opinion of the district court, the Court of Appeals held that it was against public policy for an expert witness to be compensated on a contingency basis. See Accrued Fin. Servs., Inc. v. Prime Retail, Inc., No. CIV.JFM-99-2573, 2000 WL 976800, at *3 (D. Md. June 19, 2000). The case was decided under Maryland law, and the district court referred to the Maryland Rules of Professional Conduct as expressing the state’s public policy regarding contingent fees for expert witnesses. Accrued Fin. Servs., Inc. v. Prime Retail, Inc. No., CIV.JFM-99-2573, 2000 WL 976800, at *2 (D. Md. June 19, 2000). Although the Fourth Circuit’s opinion in the case was divided 2-1, even the dissent agreed that “an agreement with a witness to pay him a fee contingent on the success of the litigation is against public policy and void.” 298 F.3d at 307.

Other district courts in the Fourth Circuit have similarly held that payment to an expert witness on a contingent basis is improper and grounds for disqualification of the expert. See, e.g., Farmer v. Ramsay, 159 F. Supp. 2d 873, 883 (D. Md. 2001) (holding that witness contingency fee agreements violate the fundamental public policy of Maryland and the United States). See also Keyfer & Associates Inc. v. Brock, No. 1:07-cv-2297-CC, 2009 WL 10672772, at *5 (N.D. Ga. Mar. 31, 2009) (holding that a contingent fee agreement would “threaten the integrity of [the court’s] proceedings…”).

The cost of an expert can be a major litigation expense, but it is one that must be included without any shortcuts. An attorney is free to take any case on a contingency basis but cannot ask an expert to do the same.