Many litigants are unaware that testifying expert costs are not automatically recoverable in federal court like they are in state court.   Expert witness fees / costs are not an automatic taxable costs.   28 U.S.C. s. 1920 discusses taxable costs. 28 U.S.C. s. 1821 discusses a witness’ per diem costs of $40/day for each day’s attendance. See 28 U.S.C. 1821(2)(b) (“A witness shall be paid an attendance fee of $40 per day for each day’s attendance. A witness shall also be paid the attendance fee for the time necessarily occupied in going to and returning from the place of attendance at the beginning and end of such attendance or at any time during such attendance.”).

The Eleventh Circuit in Primo v. State Farm Mutual Automobile Ins. Co. , 2016 WL 5436821, *5 (11^th Cir. 2016) explained that, “[u]nder 28 U.S.C. § 1821(b), [a] witness shall be paid an attendance fee of $40 per day for each day’s attendance. The Supreme Court has held that when a prevailing party seeks reimbursement for fees paid to its own expert witness, a federal court is bound by the limit of § 1821(b), absent contract or explicit statutory authority to the contrary.” (internal quotations omitted).

In order to recover more than the standard per diem witness fee, either the contract needs to authorize expert witness fees or a specific federal statute needs to authorize the recovery of testifying expert costs. See Troche v. City of Orlando, 2015 WL 631280 (M.D.Fla. 2015) (“[A]bsent explicit statutory or contractual authorization for the taxation of the expenses of a litigant’s [expert] witness as costs, federal courts are bound by the limitations set out in 28 U.S.C. § 1821 and § 1920. Section 1920 does not provide for costs for experts unless they were court-appointed.”) (internal quotations omitted).

When drafting a prevailing party attorney’s fees provision in a contract, I always like to include that the prevailing party is entitled to recover their testifying expert witness fees.  This way if the lawsuit is filed in federal court there is a contractual basis to recover expert witness fees. 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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Directors that serve on a board owe a fiduciary duty to their company and members. Directors are generally protected from personal liability for decisions they make by what is known as the business judgment rule. See Fla. Stat. s. 607.0830 (“(5) A director is not liable for any action taken as a director, or any failure to take any action, if he or she performed the duties of his or her office in compliance with this section.”); see also Florida Statute s. 617.0834 (regarding directors that serve on a nonprofit board).   These are very important statutes (607.0830 and 617.0834) for directors that serve on for profit and not for profit boards and their discharge of duties and decision-making.

The business judgment rule, however, is not absolute meaning directors are not automatically immunized from personal liability if they do not at in good faith, as set forth below. Directors needs to remember this point!

Under the business judgment rule, a court presumes that corporate directors acted in good faith. The rule prevents a court—which may possess less business expertise than the corporate directors—from calling upon directors to account for their actions, no matter how poor their business judgment, absent a showing by the plaintiff of abuse of discretion, fraud, bad faith, or illegality. The rule also prevents a factfinder from using hindsight to second-guess directors’ business decisions.

Kloha v. Duda, 246 F. Supp.2d 1237, 1244-45 (M.D. Fla. 2003) (internal citations omitted); accord Raphael v. Silverman, 22 So.3d 837, 838 (Fla. 4^th DCA 2009) (nonprofit condominium association directors “are immune from liability in their individual capacity absent fraud, criminal activity, or self-dealing/unjust enrichment.”); Hollywood Towers Condominium Ass’n, Inc. v. Hampton, 40 So.3d 784, 787 (Fla. 4^th DCA 2010) (“In applying the business judgment rule to condominium association decisions, courts have generally limited their review to two issues: (1) whether the association has the contractual or statutory authority to perform the relevant act, and (2) if the authority exists, whether the board’s actions are reasonable.”).

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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