                           @ffice
                                oftlyQttornep
                                            f&meral
                                        &ate of &exae
DAN MORALES                                 April lo,1992
 .ATTORSEY
       CENER.AL




      Honorable Merrill L Hartman                         Opinion No. DM-102
      Chairman
      Court Reporters Certification Board                 Re: Whether a certified shorthand
      P. 0. Box 13131                                     reporter in the State of .Texas may
      Austin, Texas 78711-3131                            contract with a company to fulfill all
                                                          of the 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 who represent it to use only the CSR who 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 grand jury, referee, or court commissioner for use in litigation
      in the courts of this state. Gov’t Code 5 52.001(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 3 52.021(b);
      see id. $6 52.021- 52.024 (discussing requirements for certification). CSRs are


              IA nonwrtified shortband reporter may record an oral deposition only when a certifrcd
      shorthand reporter is uwailable. Gov’t Code 3 52.031.




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Honorable Merrill L’Hartman - Page 2 (DM-102 1




certified and governed ,according to rules the Texas Supreme                           Court has
promulgated. Id 9 52.002.

        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 on every

           transcription of any oral court proceeding, deposition or
           proceeding before a grand jury, 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 his or her State certification number and
           the date of expiration of certification.

Texas Supreme Court Standards and Rules for Certification of Certified 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
“true and correct transcription” of the proceeding 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 of the company’s shorthand 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 of forms 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 arc unaware of which particular edition 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, and Wyoming. See gcnemUy Committee on Dqwsition Forms, Na-
tional Shorthand Reporters’ Association (1971).




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Honorable Merrill L Hartman - Page 3 (DM-102 )




depositions taken in a federal proceeding may not be taken by “a person who is a
relative or employee or attorney or counsel of any of the parties, or is a relative or
employee of such attorney or counsel, or is financially interested in the action,“3 and
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 any provisions 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 of these 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



         %Je understand that the issue of whether a contract with a party such as the contracts at issue
here coostitutcs an employment relatiooship or indicates a IkaociaI interest, either direct or indirect, in
the action has not yet been determined by an adjudicative body.

         ‘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         Liable for a
[CSR’s] charges’ for rcportiw and transcrii        the deposition and for cacb copy of the deposition
transcript the attorney requests, a company that is not a law fum caanot pay the 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~leto 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 and the dent both refuse to pay the 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 are the only entities who are permitted to pay CSR’s biIIs, and we believe that the
language of section 52059(a) is co&tent with that intent.




                                                p.   520
                                             .

Honorable Merrill L Hartman - Page 4         (DM-102 1




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 $4 52.027 - 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 CSR to 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 of duty, and unprofessional conduct. Under the rules,
such disciplinary action may include revoking or suspending the CSR’s certification.
Gov’t Code 3 52.029; 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 of a contractual arrangement with a
company involves the resolution of factual issues, a task the statute assigns to the
board.

       It also has been 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 of transcriptions. 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 cost when “the
court reporter has actually not charged the contracted party anything for the taxable
portion of the depositions.” Again, the statutes and the rules expressly proscribe
fraudulent, dishonest, or unprofessional conduct, and wilful or negligent violations
of duty. Gov’t Code 8 52.029(a); Texas Supreme Court, supru. If the board finds a
CSR guilty of such conduct, the CSR is subject to disciplinary action, which may
consist of revocation or suspension of the CSR’s certification. 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 a CSR agrees to fulfill all of the contracting company’s shorthand
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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Honorable Merrill L Hartman - Page S        ( DM-   102 )




unprofessional conduct, but the determination of whether a CSR in a particular
contractual arrangement is committing any of the proscribed types of behavior 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 by the Texas Supreme Court.

                               SUMMARY

              Neither Texas statutes nor rules promulgated by the Texas
         Supreme Court preclude a certified shorthand reporter in the
         State of Texas from contracting with a company to provide all of
         the shorthand reporting services the company requires. Section
         52.029 of the Government Code lists various types of behavior
         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 of the Standards and Rules for Certification of Certified
         Shorthand Reporters, promulgated by the Supreme Court of
         Texas.

                                                    Very truly yours,




                                                    DAN      MORALES
                                                    Attorney General of Texas




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Honorable Merrill L Hartman - Page 6      (DM-102 1




WILL PRYOR
First Assistant Attorney General

MARY SLLER
Deputy Assistant Attorney General

RENEAHIcKs
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Kymberly Oltrogge
Assistant Attorney General




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