Can a Texas court reporter sign an exclusive contract to handle all of one company's deposition reporting?

Plain-English summary

A certified shorthand reporter (CSR) is the person who makes the verbatim record at a deposition or other court proceeding. CSRs usually work as independent contractors, billing the party who asks the first question at a deposition on a per-page basis and selling copies of the transcript to the other parties. The chairman of the Court Reporters Certification Board asked whether a CSR could sign a contract with a company, often an insurance company, agreeing to handle all of that company's shorthand reporting needs. Under the arrangement the company tells the attorneys who represent it to use only that CSR, and in return the CSR discounts the usual fee. The chairman worried the deal would compromise the reporter's impartiality and could lead to inflated copy charges for opposing parties or fraudulent billing.

The Attorney General found nothing in chapter 52 of the Government Code or in the Texas Supreme Court's certification rules that expressly prohibits such a contract. Unlike federal practice, which bars a deposition from being taken by anyone employed by or financially interested in a party (Federal Rule of Civil Procedure 28(c)), Texas does not require a CSR to certify that he or she is disinterested, and no Texas provision forbids a reporter from having a business relationship with a party. The opinion also declined to interpret the ethics codes of the national and state court reporters' associations, saying that was outside the office's purview.

The opinion's real limit was on the back end, not the front. Section 52.029 of the Government Code lets the board discipline a CSR for fraud, dishonesty, unprofessional conduct, and willful or negligent violations of duty, up to revoking or suspending the certification. So the contract is permissible in the abstract, but whether a reporter in a specific arrangement is overcharging other parties, mislabeling court costs, or otherwise acting improperly is a factual question the board decides through the complaint, notice, hearing, and appeal process the statute lays out.

Currency note

This opinion was issued in 1992. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. Court reporter certification in Texas has since been reorganized (regulation of court reporters now runs through the Judicial Branch Certification Commission rather than a standalone Court Reporters Certification Board), so confirm the current statutory scheme before relying on this opinion.

Background and statutory framework

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 Texas courts. Government Code § 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; a noncertified reporter may record an oral deposition only when a certified one is unavailable. Government Code § 52.021(b), § 52.031; see §§ 52.021-52.024 (certification requirements). CSRs are certified and governed under rules the Supreme Court promulgates. Government Code § 52.002.

CSRs generally work as independent contractors, recording depositions in many lawsuits for numerous law firms and companies, including insurance companies. A CSR usually charges the party asking the first question at a deposition on a per-page basis, and other parties may buy copies of the transcript. Texas Rule of Civil Procedure 206. Neither the statutes nor the rules require a CSR to take or sign an oath on certification. The rules do require the CSR to certify, on every transcription, the reporter's signature, address, telephone number, certification number, and expiration date, and to certify that the transcript is a "true and correct transcription" of the proceeding.

The chairman attached deposition forms from other jurisdictions to suggest a reporter has a duty to remain neutral. In federal proceedings, a deposition may not be taken by a person who is a relative, employee, attorney, or counsel of a party, a relative or employee of such attorney or counsel, or someone financially interested in the action, and the reporter must certify to this on each transcription. Federal Rule of Civil Procedure 28(c). Texas requires no comparable certification, and no Texas provision expressly bars a CSR from being employed by, or having a relationship of interest with, a party. The opinion therefore could not conclude that a contracting CSR was violating any express statute or rule. It also noted the suggestion that, because Government Code § 52.059(a) makes the attorney who takes a deposition and the attorney's firm jointly liable for the reporter's charges, a non-law-firm company could not pay the CSR directly; the opinion read § 52.059(a), in light of the bill analysis for Senate Bill 858 (which became the section), as ensuring the reporter gets paid when an attorney's client refuses, not as making the attorney and firm the only permissible payers.

On enforcement, the opinion pointed to Government Code §§ 52.027-52.030, which establish verified-complaint, notice, hearing, disciplinary-action, and appeal procedures. Section 52.029 lists the behaviors for which the board may sanction a CSR, including fraud and unprofessional conduct, and section 52.029(a) allows discipline up to revocation or suspension. Whether a CSR in a particular contract committed dishonest or unprofessional conduct, charged opposing parties excessive copy fees, or misstated taxable court costs were all factual determinations the statute assigned to the board.

Common questions

Did Texas law forbid a court reporter from working exclusively for one company?
No. The opinion found no statute and no Supreme Court certification rule that expressly prohibited a certified shorthand reporter from contracting with a company to provide all of its shorthand reporting needs, even at a discounted fee in exchange for exclusivity.

Was a Texas court reporter required to be financially disinterested in the case?
Not by statute. The opinion noted that federal practice bars a deposition reporter who is employed by or financially interested in a party, but Texas imposed no such certification requirement and no express ban on a reporter having a relationship with a party.

Could a non-law-firm company pay the reporter directly?
The opinion read Government Code § 52.059(a), which makes the deposing attorney and firm jointly liable for the reporter's charges, as a backstop to ensure the reporter is paid, not as limiting who may pay. So a contracting company could pay the CSR directly.

What stopped a reporter from abusing the arrangement?
The Court Reporters Certification Board. Section 52.029 of the Government Code let the board sanction a reporter for fraud, dishonesty, or unprofessional conduct, up to suspension or revocation, after the complaint and hearing process in sections 52.027 through 52.030. Whether any particular reporter crossed that line was a fact question for the board.

Citations

• Government Code § 52.001(4), (5); § 52.002; § 52.021(b); §§ 52.021-52.024; § 52.031; § 52.059(a); §§ 52.027-52.030; § 52.029; § 52.029(a)
• Texas Rule of Civil Procedure 206
• Federal Rule of Civil Procedure 28(c)
• Senate Bill 858, 72d Legislature (1991)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0102
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1992/dm0102.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

Office of the Attorney General
State of Texas

DAN MORALES
ATTORNEY GENERAL

April 10, 1992

Honorable Merrill L. Hartman
Chairman
Court Reporters Certification Board
P. O. Box 13131
Austin, Texas 78711-3131

Opinion No. DM-102

Re: Whether a certified shorthand reporter in the State of Texas may 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 and lead 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 § 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. § 52.021(b); see id. §§ 52.021-52.024 (discussing requirements for certification). CSRs are certified and governed according to rules the Texas Supreme Court has promulgated. Id. § 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. CIV. 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 Certification 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, 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 FED. R. CIV. P. 28(c). Neither Texas statutes nor the rules require CSRs in Texas state court proceedings to certify 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 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 §§ 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, supra 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 § 52.029; Texas Supreme Court, supra 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 § 52.029(a); Texas Supreme Court, supra. 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, supra; Texas Supreme Court, supra.

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 lists various types of behavior for which the board may sanction a CSR, including fraud and 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

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Deputy Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Kymberly Oltrogge
Assistant Attorney General

[1] A noncertified shorthand reporter may record an oral deposition only when a certified shorthand reporter is unavailable. Gov't Code § 52.031.

[2] You 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 are unaware of which particular edition you copied the forms from). The forms you have copied are for the following courts: United States District Court; United States Patent Office; United States Board of Tax Appeals; and the state courts of Indiana, Michigan, New York, Tennessee, and Wyoming. See generally Committee on Deposition Forms, National Shorthand Reporters' Association (1971).

[3] We understand that the issue of whether a contract with a party such as the contracts at issue here constitutes an employment relationship or indicates a financial interest, either direct or indirect, in the action has not yet been determined by an adjudicative body.

[4] It has been suggested that because section 52.059(a) of the Government Code provides that the "attorney who takes a deposition and the attorney's firm are jointly and severally liable for a [CSR's] charges" for reporting and transcribing the deposition and for each copy of the deposition transcript the attorney requests, a company that is not a law firm cannot pay the CSR even though the firm 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 taking the deposition and the attorney's firm are responsible to pay the CSR when the attorney's client, or any other person who may have agreed to pay, refuses to do so. Indeed, we note that the bill analysis for Senate Bill 858, which became section 52.059, indicates that the legislature designed the bill to remedy the problem resulting when the attorney and the client both refuse to pay the CSR. House Comm. On State Affairs, Bill Analysis, S.B. 858, 72d Leg. (1991). Thus, the legislature did not intend the section to provide that the attorney and the attorney's firm are the only entities who are permitted to pay CSR's bills, and we believe that the language of section 52.059(a) is consistent with that intent.