Lexington noticed Mr. Zelaya's deposition on March 7, 2019 for a deposition to take place on June 4, 2019.

On May 30, 2019, Mr. Zelaya submitted a fee invoice for his deposition, requesting an hourly rate of $225 and a retainer of $900 to be paid in advance.

The next day, PC Anything's counsel advised Lexington that PC Anything intended to designate Mr. Zelaya as an expert witness.

Lexington objected to Mr. Zelaya's request for an advanced upfront fee to appear at his deposition yet advised that it was agreeable to paying a reasonable expert hourly rate.

In response, Mr. Zelaya informed Lexington that he would not appear if Lexington did not pay his flat fee. On June 4, 2019, Mr. Zelaya failed to appear for his deposition.

Lexington asked the court to enter an order to show cause as to why Mr. Zelaya should not be held in contempt, awarding attorneys' fees and costs related to Mr. Zelaya's deposition, and compelling Mr. Zelaya to appear for a deposition before its own corporate representative was scheduled to be deposed.

In response, PC Anything contended that because Lexington knew that Mr. Zelaya would not appear if his fee was not paid in advance, and Lexington insisted on attending his deposition anyway, Lexington was not entitled to recover its fees and costs associated with Mr. Zelaya's deposition.

In addition, PC Anything provided an affidavit from Mr. Zelaya in which he expressed that in his experience, his expert fee had remained unpaid by insurers, so he requested that his fees, including his retainer, be agreed to prior to the deposition taking place.

The District Court's Decision

The district court explained that Federal Rule of Civil Procedure 26(b)(4)(E)(i) stated that “[u]nless manifest injustice would result, the court must require that the party seeking discovery[] pay the expert a reasonable fee for time spent in responding to discovery under Rule 26(b)(4)(A) or (D).” The district court then pointed out that the rule was silent with respect to the timing of that payment.

Moreover, the district court continued, PC Anything did not provide any authority to support its position that an expert witness could condition his or her appearance for deposition upon a payment in advance.

The district court reasoned that permitting an expert to condition his or her appearance on prepayment of fees would “undoubtedly hamper an opposing party's ability to conduct relevant discovery.” It then ruled that it was improper for Mr. Zelaya to condition his appearance for deposition upon an advance payment.

Next, the district court considered whether contempt or other sanctions were warranted.

It decided that it would not hold Mr. Zelaya in contempt, but found that monetary sanctions against PC were warranted. According to the district court, PC Anything did not demonstrate that its conduct in failing to produce its expert for a duly noticed deposition based on Lexington's objection to paying the expert in advance was substantially justified. It also rejected PC Anything's position that there was a basis to deny Lexington the fees and costs incurred in appearing at Mr. Zelaya's deposition because Lexington knew that Mr. Zelaya would not appear absent payment in advance, declaring that if PC Anything truly believed that there was a good faith basis for its expert to avoid the subpoena and resulting deposition, it should have sought relief from the court though a motion for a protective order. PC Anything, however, “did not do so” and PC Anything allowed its expert to avoid a court order, the district court added.

Accordingly, it concluded, Lexington was entitled to recover its reasonable attorneys' fees and costs incurred related to Mr. Zelaya's failure to appear at the scheduled deposition.

The case is PC Anything, Inc. v. Lexington Ins. Co., No. 18-cv-62889-BLOOM/Valle (S.D. Fla. June 18, 2019). Attorneys involved include: For PC ANYTHING, INC., Plaintiff: Kenneth Robert Duboff, LEAD ATTORNEY, Duboff Law Firm, North Miami, FL. For Lexington Insurance Company, Defendant: Crystalin C Medeiros, The Teebagy & Medeiros Law Group, West Palm Beach, FL.

Insurance Coverage Law Center Comment

Numerous courts have found that Rule 26(b)(4)(E) does not require the payment of expert fees in advance, and have required experts to appear for deposition without being paid in advance. See Harris v. Costco Wholesale Corp., 226 F.R.D. 675, 676 (S.D. Cal. 2005) (“The rule does not state, however, that the expert's fees must be paid in advance of the deposition absent agreement to do so. To the contrary, 'unlike ordinary witness fees, no rule requires than an opposing expert's deposition fees be tendered to the witness in advance. . . .”) (internal citations omitted); Ratliff v. Baan Co., N.V., No. 1:99-cv-2455-WBH (N.D. Ga. Nov. 5, 2003) (ordering expert witness to submit to deposition without pre-payment of fees); Bartram, LLC v. Landmark Am. Ins. Co., No. 1:10-cv-00028-SPM-GRJ (N.D. Fla. Feb. 16, 2011) (an expert's fee does not have to be paid in advance); Regions Bank v. Kaplan, No. 8:12-CV-1837-T-17MAP (M.D. Fla. Aug. 18, 2015) (granting motion to defer payment to expert as Rule 26 does not require payment in advance); Guevara v. NCL (Bahamas) Ltd., No. 15-24294-CIV-WILLIAMS (S.D. Fla. Feb. 13, 2017) (“[T]here is absolutely no requirement in the Federal Rules of Civil Procedure that expert fees be paid in advance of the expert's deposition, and courts routinely order experts to submit to deposition before payment.”).