BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1197


                                                                    Page  1


          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          1197 (Bonilla)


          As Amended  July 15, 2015


          Majority vote


           -------------------------------------------------------------------- 
          |ASSEMBLY:  | 78-0 | (April 23,    |SENATE: |39-0  | (August 24,     |
          |           |      |2015)          |        |      |2015)            |
          |           |      |               |        |      |                 |
          |           |      |               |        |      |                 |
           -------------------------------------------------------------------- 


          Original Committee Reference:  JUD.




          SUMMARY:  Requires that certain contractual relationships  
          between the parties to a deposition be disclosed to all parties  
          in the deposition notice.  Specifically, this bill:  
          1)Requires a statement disclosing the existence of a contract,  
            if known by the noticing party, between the deposition officer  
            or entity providing the services of the deposition officer and  
            the noticing party, or a third party who is financing all or  
            part of the action requiring that party to use the officer or  
            entity for any service beyond the noticed deposition, be  
            included.
          2)Requires a statement disclosing that the party noticing the  
            deposition, or a third party who is financing all or part of  
            the action, has directed his or her attorney to use a  
            particular officer or entity to provide services for the  
            deposition, if applicable.









                                                                    AB 1197


                                                                    Page  2



          The Senate amendments:  


          1)Clarify that the party noticing the deposition must disclose  
            the existence of a contract between the deposition service  
            company or the deposition officer and the noticing party for  
            services beyond the noticed deposition, if the noticing party  
            has knowledge of the existence of such a contract; and 


          2)Remove the right of a party to serve an objection to the use  
            of a deposition officer or entity, at least three calendar  
            days prior to the deposition, when it has been disclosed that  
            a contract for services beyond the noticed deposition exists  
            between the noticing party and the deposition officer or  
            entity. 


          EXISTING LAW:  A party desiring to take the oral deposition of  
          any person must give notice in writing.  The notice must contain  
          all of the following: 


          1)The address where the deposition will be taken. 


          2)The date of the deposition, and the time it will commence. 


          3)The name of each deponent, and the address and telephone  
            number, if known, of any deponent who is not a party to the  
            action. 


          4)Specific information regarding any materials, including  
            materials that are electronically stored, that the deponent is  
            to bring or produce at the deposition. 


          5)Any intention that the party noticing the deposition has to  
            record the testimony by audio or video technology, in addition  








                                                                    AB 1197


                                                                    Page  3


            to recording the testimony by a stenographic method, including  
            through instant visual display. 


          6)Any intention to reserve the right to use at trial a video  
            recording of deposition testimony of a treating or consulting  
            physician, or other expert witness testimony. 


          7)The form in which any electronically stored information is to  
            be produced, if a particular form is desired.  


          FISCAL EFFECT:  None


          COMMENTS:  Under existing law, a deposition must be noticed to  
          all parties and relevant non-parties, prior to the actual  
          deposition.  Requiring notice in advance allows all parties to  
          attend the deposition and to prepare for the deposition hearing.  
           This bill uses the existing process of noticing a deposition to  
          facilitate disclosure to all parties of any existing contractual  
          relationships that may have an impact on the pending litigation.  
           It places the burden on the party noticing the deposition to  
          include several disclosures, when applicable.  The required  
          disclosures include:  1) a statement of the existence of a  
          contract, if any between the party noticing the deposition and  
          or a third party who is financing any part of the action and  
          either:  the deposition officer (court reporter) or the entity  
          providing the services of the deposition officer for any service  
          beyond the noticed deposition; and 2) a statement that the  
          noticing party directed his or her attorney to use a particular  
          officer or entity to provide services for the deposition, if  
          applicable.  Any objection to the use of a particular deposition  
          officer or service may be made in accordance with existing law. 


          Exclusive contracts are creating a damaging effect on  
          litigation.  In recent years, the field of court reporting has  
          expanded into a larger, more corporate-driven business industry.  
           A disturbing trend has developed, threatening what was once a  
          unique economic opportunity for women.  According to an article  








                                                                    AB 1197


                                                                    Page  4


          published on the Consumer Watchdog Web site, an increasing  
          number of large companies, such as those in the business of  
          insurance and construction, have entered the court reporting  
          arena.  These larger companies are effectively running the  
          smaller, women-owned court reporting companies out of the  
          industry by establishing long-term contractual agreements with  
          court reporting agencies.  After forming these contractual  
          alliances, these larger companies then require their counsels to  
          use specific agencies for all or most of the depositions noticed  
          on behalf of the corporation.  In return for the guaranteed  
          business to these dedicated court reporting agencies, the large  
          company receives reduced fees and special services from the  
          court reporting agencies.  Two of these special services, which  
          among others that have been targeted as being problematic, are  
          deposition databases and free deposition summaries.  


          The impact of reduced fees and free special services in exchange  
          for volume business.  Reduced fees are exactly what they sound  
          like, requiring one party in a lawsuit to pay more for the same  
          deposition services offered to the other side for less because  
          of an existing contractual relationship.  Deposition databases  
          are proprietary databases that may contain thousands of records,  
          including expert witnesses, expert witnesses' prior testimonies,  
          various transcripts, depositions, records of parties' and  
          experts' disciplinary actions, and other information that can be  
          compiled and customized into any number of desired reports that  
          are pertinent to the specifics of individual cases.  Deposition  
          summaries are summaries of the deposition testimony transcript  
          and they simplify the work normally involved in reviewing a  
          deposition transcript because a party who receives the summary  
          does not have to sift through the entire deposition transcript  
          in order to gather the most relevant facts.  In larger cases  
          with huge volumes of testimony, the opposing party is again at a  
          huge disadvantage when they lack such a valuable tool to which  
          the other side has.  In many instances, the opposing party is  
          never given the opportunity to purchase these litigation tools.


          Other complaints regarding these special services are that  
          attorneys representing these large companies receive their  
          copies of deposition transcripts much faster than the opposing  








                                                                    AB 1197


                                                                    Page  5


          party.  This allows extra time for that attorney to look over  
          the deposition transcript before a hearing, or to include  
          portions of the deposition transcript into their legal briefs.   
          Even in situations where the opposing party has the opportunity  
          to get a copy of the transcript in an expedited manner, the  
          costs can be prohibitive.  In the legal world, these litigation  
          support services are viewed as unfair because they grant huge  
          advantages to one party and huge disadvantages to another.   
          Plaintiffs' lawyers are calling foul, arguing that these  
          "contract or agreements" amount to basically free litigation  
          support at their expense.  


          By requiring a disclosure of these existing contractual  
          relationships, opposing parties have the opportunity to object  
          as allowed by existing law.


          Reliability of court reporters, deposition transcripts and the  
          appearance of partiality.  The complaints go even further  
          regarding these contractual relationships, with many wondering  
          whether the actual court reporters can remain neutral when they  
          are involved in these types of contractual relationships.  If  
          one side is providing continued, and in some cases, exclusive  
          use of the same reporting service, is that side getting more  
          than just great services?  Is it possible that they may be  
          getting a better deposition in the content, or in the manner in  
          which the transcript is being transcribed?  Court reporters have  
          always been considered neutral and impartial court officers in  
          legal matters.  However, more frequently the question is being  
          raised by plaintiffs' attorneys nationwide, whether the court  
          reporter and or the transcript that is being produced by court  
          reporting companies in these relationships may still be granted  
          the assumption of being reliable?  Persons and entities that  
          were at one time considered the "only impartial person in the  
          room" are now being viewed with suspicion and rising valid  
          concerns regarding the "appearance of partiality."


          By requiring that these relationships be disclosed to parties  
          who may be affected by them, this bill allows the opposing party  
          to perform any necessary due diligence in order to determine if  








                                                                    AB 1197


                                                                    Page  6


          an objection is needed  in order to ensure a fair discovery  
          process.


          Analysis Prepared by:                                             
                          Khadijah Hargett / JUD. / (916) 319-2334  FN:  
          0001272