I. Introduction

• Library: Professional Responsibility in Litigation (ABA) (2016 Ed.)

I. Introduction

In 2007, Feld Entertainment, Inc., which produces circus shows as Ringling Bros. & Barnum & Bailey Circus, sued the American Society for the Prevention of Cruelty to Animals (ASPCA) and other animal welfare and wildlife organizations and individuals for alleged offenses related to a lawsuit in which the defendants—then plaintiffs— had unsuccessfully sued Feld for allegedly mistreating its circus elephants.¹ A former Feld employee, Tom Rider, was the star witness for the then-plaintiffs in what we'll call the "elephant case."² Rider purportedly quit his job as an elephant attendant because of the mistreatment of an elephant he worked with, and he testified about the alleged abuse of the animals, which was central to the elephant case. His testimony in the elephant case lacked credibility and was unpersuasive but remunerative. Indeed, Rider was paid handsomely for his service in the losing cause, having received cash payments exceeding $190,000, plus "non-cash compensation, such as a van, hotel rooms, cell phone use, a video camera, zoom camera equipment and a laptop computer" from the now-defendant organizations.³

In holding for Feld in the elephant case, the district court determined that Rider's compensation, which the organizations allegedly tried to disguise as grants and expense reimbursements, and which they later attempted to conceal from Feld in discovery, was principally intended to motivate Rider to advance their purposes in the litigation.⁴ Feld bluntly characterized the payments to Rider as "bribery of a witness."⁵ Regardless of the label affixed to Rider's compensation, the eventual cost to the ASPCA and the other animal welfare and wildlife organizations was substantial. In December 2012, the ASPCA settled Feld's claims against it for $9.3 million. In May 2014, the remaining organizations settled with Feld for a combined $15.75 million, bringing the total settlement to just over $25 million.

Rider's compensation as a fact witness in the elephant case was extraordinary in its amount, structure, and purpose. The litigation is also remarkable because the payments to Rider—at least as reported in the district court opinion in the elephant case and as described in Feld's pleadings—were so glaringly improper and prejudicial. At the same time, former employees of parties frequently are vital fact witnesses. They often have unique factual knowledge. From former employees' perspectives, however, participating in litigation may take them away from their current jobs, thereby costing them income or vacation time; it may impede their self-employment; or it may interrupt their retirements. It is therefore understandable that former employees may want to be paid for devoting time to litigation in which they have no stake. They may well seek compensation for time spent testifying, meeting with lawyers, or otherwise assisting with case preparation. Other fact witnesses likewise may be interested in compensation for their time connected to litigation. In patent litigation, for example, an inventor who is a fact witness also may be an essential consultant who deserves compensation for time spent in the latter role.⁶ Passersby who witness accidents may be critical to the outcome in resulting litigation, and parties may want to compensate them for taking time off from their jobs to testify. The list goes on.

It was once the rule that fact witness compensation was limited to statutory witness fees or subpoena rates.⁷ The prohibition on greater compensation rested on several factors, including the concern that such payments could entice fact witnesses to perjure themselves, might simply influence witnesses to shade or shape their testimony in ways favorable to the parties paying them, could price justice out of the reach of some parties, and created an appearance of impropriety. Courts further considered fact witnesses' testimony to be their civic duty. On the other hand, conscientious fact witnesses may be required to devote considerable time to preparing their testimony and actually testifying in cases in which they are called. The overwhelming majority of witnesses faithfully honor their oaths to testify truthfully;⁸ assuming that their compensation is timely disclosed, witnesses' alleged biases attributable to such payments can be exposed on cross-examination;⁹ and not all...