DAN MORALES

.ATTORSEY CNER.AL 

## @ffice

oftly Qttornep f&meral &ate of&exae April lo,1992

Honorable Merrill L Hartman Chairman Opinion No.DM-102

Court Reporters Certification Board P.0. Box 13131 Austin,Texas 78711-3131 Re: Whether a certified shorthand reporter in the State of .Texas may contract with a company to fulfill all ofthe company’s shorthand reporting needs (RQ-263)

Dear Judge Hartman:

You ask about the permissibility of a certified shorthand reporter (hereinafter CSR) contracting with a company to provide all of the shorthand reporting services the company needs. We are informed that under this type of contractual arrangement, the contracting company, often an insurance company, instructs the attorneys whorepresent itto use onlythe CSRwho has contracted with the company. The CSR discounts his or her usual fee in return for the company’s promise to exclusively use the CSR. You are concerned that such a contractual arrangement will affect the CSR’s impartiality Andylead to inequitable billing practices and fraudulent conduct.

Under chapter 52 of the Government Code, a “shorthand reporter” is a person who, using written symbols in shorthand, machine shorthand, or oral stenography, makes a verbatim record of an oral court proceeding, deposition, or proceeding before a grandjury, referee, or court commissioner for use in litigation in the courts of this state. Gov’t Code 552.001(4), (5). Except in very limited circumstances, a person may not engage in shorthand reporting unless the Texas Supreme Court has certified the person as a shorthand reporter.1 Id 352.021(b);
see id. $652.021- 52.024 (discussing requirements for certification). CSRs are

IA nonwrtified shortband reporter may record an oral deposition only when a certifrcd shorthand reporter isuwailable. Gov’t Code 352.031.

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certified and governed ,according to rules the Texas Supreme Court has promulgated. Id 952.002.

CSRs work generally as independent contractors, recording depositions and other proceedings in numerous lawsuits for a number of law firms and other companies involved in’lawsuits, such as insurance companies. A CSR usually charges, on a per page basis, the party asking the first question at the deposition. See TEX. R. CTV.P. 206. Other parties may purchase copies of the deposition transcript from the CSR. Neither the statutes nor the rules promulgated by the Supreme Court of Texas (hereinafter the rules) require a CSR to take or sign an oath upon certification, The rules do,however,require a CSR to certify onevery

transcription of any oral court proceeding, deposition or proceeding before a grandjury, referee or court commissioner,
or any other document certified by a certified shorthand reporter for use in litigation in the courts of Texas,.

..the signature, address and telephone number of the certified shorthand reporter and hisorher State certification number and the date ofexpiration ofcertification.

Texas Supreme Court Standards and Rules for Certification ofCertified Shorthand Reporters pt. I(I)(l) (unpublished, on file with the Court Reporters CertiGcation Board). The rules further require a CSR to certify on each transcription that it is a

“trueand correct transcription” oftheproceeding transcribed. Id

We find nothing in the statutes or the rules expressly prohibiting a contractual arrangement between a CSR and a company or organization in which the CSR agrees to fulfill all ofthe company’sshorthand reporting needs. However, you attach to your request letter copies of several deposition forms containing statements to which other state and federal courts require a CSR to certify,2 apparently to illustrate that a CSR has a duty to,remain neutral. For example,

2You have submitted copies offorms setting forth language to which CSRs in different states must certify. We understand that you have copied most of the forms from a book printed by the National Shorthand Reporters’ Association (we arcunaware ofwhich particularedition you copied the fonts from). The forms you have copied arc for the folbving courts: United State4 District Court; United States Patent Of&; United States Board of Tax Appcalq and the state courts of Indiana, Michigan, New York, Tennessee, andWyoming. SeegcnemUy Committee on Dqwsition Forms, National Shorthand Reporters’ Association (1971).

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depositions taken in a federal proceeding may not be taken by “aperson who is a relative or employee or attorney or counsel ofany ofthe parties, or is a relative or employee ofsuchattorney or counsel, or isfinancially interested inthe action,“3and the CSR must certify to this on each transcription. See =D. R. CIV. P. 28(c). Neither Texas statutes nor the rules require CSRs in Texas state court proceedings to certi@a statement similar to the above-quoted statement; in addition, we do not find anyprovisions expressly prohibiting CSRs from being employed by, or having a relationship of interest with, a party to the lawsuit.4 Consequently, we cannot conclude on the basis of Texas statutory and regulatory law that CSRs who enter into a contractual relationship with a company are violating an express statute or rule.

We are advised that the National Court Reporters’ Association Code of Professional Responsibility requires a court reporter to avoid any appearance of conflict of interest.,to conduct himself with impartiality toward all participants in every case, and to disclose any existing or past financial, business, professional family or social relationships which might reasonably create an appearance of impartiality. Additionally, we are advised that the Texas Court Reporters’ Association Code of Professional Conduct requires court reporters to be fair and impartial during all reported proceedings. Interpretation ofthese professional rules is beyond the purview of this office. Thus, we do not decide whether these provisions, enacted by the national and state court reporters’ associations, prohibit

%Jeunderstand that the issue ofwhether acontract with apartysuch asthe contracts at issue here coostitutcs anemployment relatiooship or indicates aIkaociaI interest, either direct or indirect, in the action hasnot yetbeen determined byan adjudicativebody.

‘It has been suggested that because section 52059(a) of the Government Code provides that the “attorney who takes a deposition and the attomey’s firm are jointly and -aIIy Liablefor a [CSR’s] charges’ for rcportiw and transcrii the deposition and for cacb copy of the deposition transcript the attorney requests, acompany that is not a law fum caanot paythe CSR even tbougb the fum has contracted with the CSR to pay the CSR directly for shorthand reporting services. In our opinion, section 52.059(a) mandates that the attorney takiog tbc dcpostion and the attorneys firm are respons13~le

to pay the CSR when the attorneys dient, or any other person who may have agreed to pay, r&sea to do so. Indeed, we note that the bii aaalysis for Senate Bii 858, which became section 52.059, indicates that the legislature designed the bii to remedy the problem resuking when the attorney andthe dent both refuse to paythe CSR. House Comm. On State Affairs, Bii Analysis, S.B. g5&M Leg. (1991). Thus, the legislature did not intend the section to provide that the attorney and the attomcy’s fim arethe only entities who are permitted to pay CSR’s biIIs,and we believe that the language ofsection 52059(a) isco&tent with that intent.

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or restrict a shorthand reporter’s ability to contract with companies to fulfill all of the company’s shorthand reporting needs.

To the extent that a CSR violates state statutes and regulations, the statutes and rules provide means through which the Court Reporters Certification Board (hereinafter the board) can sanction the CSR. See Gov’t Code $452.027-52.030 (establishing requirements for verified ~complaints,notice and hearing, disciplinary actions, and appeal of disciplinary action); Texas Supreme Court, Standards and Rules for Certification of Certified Shorthand Reporters pt. IV (same). For example, the rules require a CSRto certify on every transcription that the transcript he or she has prepared is a “true and correct transcription.” Texas Supreme Court, rupra pt. I(I)(l). If a CSR violates the duty to prepare a “true and correct” transcript, presumably the CSR would be subject to disciplinary action from the board for dishonesty, failure ofduty, and unprofessional conduct. Under the rules, such disciplinary action may include revoking or suspending the CSR’scertification. Gov’t Code 352.029; Texas Supreme Court, supru pt. IV(A). Whether a CSR committed dishonest or unprofessional conduct in a particular situation, thereby violating the statutes and the rules, as a result ofa contractual arrangement with a company involves the resolution of factual issues, a task the statute assigns to the board.

It also hasbeen suggested that to make up for the discounted service charge billed to the contracting company, a CSR may charge other parties to the action excessive fees for copies oftranscriptions. Further, it has been suggested that the kind of contractual arrangement at issue here may result in fraudulent conduct in that the court reporter may indicate an amount to be taxed as court costwhen “the court reporter has actually not charged the contracted party anything forthe taxable portion of the depositions.” Again, the statutes and the rules expressly proscribe fraudulent, dishonest, or unprofessional conduct, and wilful or negligent violations ofduty. Gov’t Code 852.029(a); Texas Supreme Court, supru. If theboard finds a CSR guilty of such conduct, the CSR is subject to disciplinary action, which may consist of revocation or suspension of the CSR’scertification. Gov’t Code, supru; Texas Supreme Court, mpm.

In short, we find no state statutory or regulatory provision expressly prohibiting CSRs from entering into a contractual arrangement with a company, pursuant to which aCSR agrees to fulfill all ofthe contracting company’sshorthand reporting needs. Section 52.029 of the Government Code liits various types of behavior for which the board may sanction ‘a CSR, including fraud and

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unprofessional conduct, but the determination of whether a CSR in a particular contractual arrangement is committing any ofthe proscribed types ofbehavior is a determination the board must make according to the procedures set forth in sections 52.027 through 52.030 of the Government Code and part IV of the rules promulgated bythe Texas Supreme Court.

SUMMARY

Neither Texas statutes nor rules promulgated by the Texas Supreme Court preclude a certified shorthand reporter in the State ofTexasfrom contracting with acompany toprovide all of the shorthand reporting services the company requires. Section 52.029 of the Government Code lists various types ofbehavior for which the Court Reporters Certification Board may sanction
a certified shorthand reporter, including fraud and unprofessional conduct, but the determination of whether a certified shorthand reporter in a particular contractual arrangement is committing any of the proscribed types of behavior is a determination the Court Reporters Certification Board must make according to the procedures set forth in sections 52.027 through 52.030 of the Government Code and part IV ofthe Standards and Rules for Certification ofCertified Shorthand Reporters, promulgated by the Supreme Court of Texas.
Very truly yours,

DAN MORALES Attorney General ofTexas

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WILLPRYOR First Assistant Attorney General

MARY SLLER Deputy Assistant Attorney General

RENEAHIcKs Special Assistant Attorney General

MADELEINE B.JOHNSON Chair, Opinion Committee
Prepared byKymberly Oltrogge Assistant Attorney General

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