Amended in Assembly June 14, 2016

Amended in Assembly June 23, 2015

Amended in Senate May 5, 2015

Amended in Senate April 14, 2015

Amended in Senate April 6, 2015

Senate Bill No. 270

Introduced by Senator Mendoza

February 19, 2015

An act to begin insert amend Sections 8031 and 8040 of, and to end insert add begin delete Section 8041 to end delete begin insert Sections 8040.1, 8040.2, and 8041 to, end insert the Business and Professions Code, relating to court begin delete reporters. end delete begin insert reporters, and making an appropriation therefor. end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 270, as amended, Mendoza. Court Reporters Board of California: civil actions: begin insert registered end insert corporations.

Existing law provides for the certification and regulation of shorthand reporters and for the regulation of shorthand reporting corporations by the Court Reporters Board of California.

Under existing law, a shorthand reporting corporation is a corporation authorized to render professional services, as defined, as long as that corporation and all of its shareholders, officers, directors, and employees rendering professional services who are certified shorthand reporters are in compliance with specified provisions of law. Existing law defines a foreign professional corporation as a corporation organized under the laws of a state of the United States other than this state that is engaged in a profession of a type for which there is specified authorization for the performance of professional services by a foreign professional corporation. Under existing law, it constitutes unprofessional conduct and a violation of these provisions for any licensed person to violate, attempt to violate, assist in or abet the violation of, or conspire to violate any specified provisions of law, including regulations adopted thereunder. Existing law prohibits a shorthand reporting corporation from not doing or failing to do any act the doing of which or the failure to do which would constitute unprofessional conduct under any statute, rule, or regulation pertaining to shorthand reporters or shorthand reporting. begin insert Existing law establishes the Court Reporter’s Fund and provides that all fees received by the board are to be deposited into that fund, which is continuously appropriated, as specified. Existing law makes it a misdemeanor to violate any of the laws that apply to shorthand reporters. end insert

This begin insert bill, on and after January 1, 2018, would authorize a corporation organized under the laws of this state or another state that is qualified to do business in this state to arrange for services of shorthand reporting only if it is registered with the board and requires the board, not later than January 1, 2018, to implement a registration process, as specified. The bill would authorize the board to suspend, revoke, deny, or take other disciplinary action against a registered corporation if the registered corporation or any of its officers, agents, or employees perform any act that is considered unprofessional conduct when arranging for any services of shorthand reporting, as described. The bill, on and after January 1, 2018, would make it unlawful for any corporation, whether foreign or domestic, to arrange for services of shorthand reporting in this state, as described, or to advertise or put out any sign, card, or other device that may indicate to members of the public that it is entitled to arrange for shorthand reporting services without first registering with the board. The bill, on and after January 1, 2018, would require a registered corporation to appoint an individual in this state to act as a designated representative and would require the designated representative to hold a valid certificate as a certified court reporter in this state or to pass an examination administered by the board, as specified. The bill would require the board to issue a certificate to the designated representative and would authorize the board to revoke the certification of the designated representative for any violation of the laws, regulations, or rules applicable to a licensee. The end insert bill would authorize the board to bring a civil action in a superior court to enjoin any begin delete person, corporation, end delete begin insert person end insert or corporation begin insert whether end insert organized under the laws of begin delete a end delete begin insert this end insert state begin insert or end insert of begin insert another state of end insert the United States begin delete other than this state, end delete from rendering court reporter services in this state without begin delete ever end delete being begin delete issued a license by end delete begin insert registered with end insert the board or without authorization to begin delete render end delete begin insert arrange for end insert court reporter services in this state. The bill would authorize the board to request the Attorney General to bring such an action. The bill would require the court to impose specified monetary penalties against the person or corporation rendering services without a begin delete license end delete begin insert registration end insert or authorization. The bill would also authorize the court to order restitution and enjoin a person or corporation from taking any action constituting a violation of any law pertaining to impartiality, as provided. begin insert The bill would authorize the board to charge a fee for a corporation to register with the board as fixed by the board and prohibits the fee from exceeding the reasonable regulatory cost of preparing and administering the registration process. By authorizing a new fee to be charged by the board that will be deposited into a continuously appropriated fund, this bill would make an appropriation. By making it unlawful for any corporation to arrange for services of shorthand reporting in this state or to advertise, as specified, without registering with the board, this bill would expand an existing crime and, therefore, impose a state-mandated local program end insert begin insert . end insert

begin insert

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

end insert begin insert

This bill would provide that no reimbursement is required by this act for a specified reason.

end insert

Vote: majority. Appropriation:  begin delete no end delete begin insert yes end insert . Fiscal committee: yes. State-mandated local program:  begin delete no end delete begin insert yes end insert .

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 8031 of the end insert begin insert Business and Professions
Code end insert begin insert is amended to read: end insert

8031.  

The amount of the fees required by this chapter is that
fixed by the board in accordance with the following schedule:

(a) The fee for filing an application for each examination shall
be no more than forty dollars ($40).

(b) The fee for examination and reexamination for the written
or practical part of the examination shall be in an amount fixed by
the board, which shall be equal to the actual cost of preparing,
administering, grading, and analyzing the examination, but shall
not exceed seventy-five dollars ($75) for each separate part, for
each administration.

(c) The initial certificate fee is an amount equal to the renewal
fee in effect on the last regular renewal date before the date on
which the certificate is issued, except that, if the certificate will
expire less than 180 days after its issuance, then the fee is 50
percent of the renewal fee in effect on the last regular renewal date
before the date on which the certificate is issued, or fifty dollars
($50), whichever is greater. The board may, by appropriate
regulation, provide for the waiver or refund of the initial certificate
fee where the certificate is issued less than 45 days before the date
on which it will expire.

(d) By a resolution adopted by the board, a renewal fee may be
established in such amounts and at such times as the board may
deem appropriate to meet its operational expenses and funding
responsibilities as set forth in this chapter. The renewal fee shall
not be more than one hundred twenty-five dollars ($125) nor less
than ten dollars ($10) annually, with the following exception:

Any person who is employed full time by the State of California
as a hearing reporter and who does not otherwise render shorthand
reporting services for a fee shall be exempt from licensure while
in state employment and shall not be subject to the renewal fee
provisions of this subdivision until 30 days after leaving state
employment. The renewal fee shall, in addition to the amount fixed
by this subdivision, include any unpaid fees required by this section
plus any delinquency fee.

(e) The duplicate certificate fee shall be no greater than ten
dollars ($10).

(f) The penalty for failure to notify the board of a change of
name or address as required by Section 8024.6 shall be no greater
than fifty dollars ($50).

begin insert

(g) The fee for a corporation to register with the board pursuant
to Section 8040 shall be in an amount fixed by the board not to
exceed the reasonable regulatory cost of preparing and
administering the registration process.

end insert

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 8040 of the end insert begin insert Business and Professions Code end insert begin insert is
amended to read: end insert

8040.  

begin insert (a) end insert begin insert   end insert A shorthand reporting corporation is a corporation
begin delete which end delete begin insert that end insert is authorized to render professional services, as defined
in Section 13401 of the Corporations Code, as long as that
corporation and all of its shareholders, officers, directors, and
employees rendering professional services who are certified
shorthand reporters are in compliance with the Moscone-Knox
Professional Corporation Act, this article, and all other statutes
and regulations now or hereafter enacted or adopted pertaining to
that corporation and the conduct of its officers. With respect to a
shorthand reporting corporation, the governmental agency referred
to in the Moscone-Knox Professional Corporation Act is the Court
Reporters Board of California.

begin insert

(b) (1) On and after January 1, 2018, any corporation
organized under the laws of this state or under the law of another
state of the United States that is qualified to do business in this
state may arrange for services of shorthand reporting in this state,
without complying with the requirements of Section 8044, if that
corporation is registered with the board. For purposes of this
section, Section 8040.1, and 8040.2, any corporation, including
but not limited to a limited liability company, a partnership, or
other entity, that satisfies the requirements of this section, Section
8040.1, and 8040.2 for registration with the board shall be referred
to as a “registered corporation.”

end insert begin insert

(2) On and after January 1, 2018, the board shall implement a
registration process pursuant to Section 8040.1.

end insert begin insert

(3) Any law or regulation applicable to a licensee shall also be
applicable to a registered corporation arranging for the services
of shorthand reporting, as described in subdivision (c), in this
state.

end insert begin insert

(4) This section shall not be construed to authorize a person
without a license issued pursuant to this chapter to practice
shorthand reporting, as defined in Section 8017.

end insert begin insert

(c) A corporation or other entity is considered to be arranging
for services of shorthand reporting in this state if it does any of
the following:

end insert begin insert

(1) Coordinates or performs any act that would otherwise
constitute an obligation owed by a certified court reporter in the
state to the parties in any reported proceeding.

end insert begin insert

(2) Determines the amount billed to the parties in a proceeding
for any court reporting services performed in this state.

end insert begin insert

(3) Recruits a resident of this state to provide court reporting
services or shorthand reporting services.

end insert begin insert

(4) Performs any services related to the duties of a certified
court reporter.

end insert begin insert

(d) A registration issued under this section may be suspended,
revoked, or denied and other disciplinary action may be imposed
if the registered corporation or any of its officers, agents, or
employees perform any act that constitutes unprofessional conduct
when arranging for any services of shorthand reporting, as
described in subdivision (c). Unprofessional conduct, includes,
but is not limited to, an act contrary to the professional standards
concerning confidentiality, impartiality, filing and retention of
notes, the notification, availability, delivery, execution, and
certification of transcripts, or any law related to the duties of a
certified court reporter.

end insert

begin insert

begin insert SEC. 3. end insert   

end insert

begin insert Section 8040.1 is added to the end insert begin insert Business and Professions
Code end insert begin insert , to read: end insert

begin insert

begin insert 8040.1. end insert   

(a) On and after January 1, 2018, it shall be unlawful
for any corporation, whether foreign or domestic, to arrange for
services of shorthand reporting, as described in subdivision (c) of
Section 8040, or to advertise or put out any sign, card, or other
device that may indicate to the public that it is entitled to arrange
for services of shorthand reporting without first registering with
the board.

(b) A corporation registering with the board shall file an
application with the board on a form prescribed by the board.

(c) The application shall include, but not be limited to, all of
the following:

(1) The federal identification number of the applicant.

(2) The name of the individual who will be appointed as a
designated representative of the applicant pursuant to Section
8040.2 and any other identifying information as required by the
board.

(3) Any required fee.

(4) All information required to complete the application.

(d) An applicant shall not be required to hold a certificate as a
certified court reporter in order to register with the board pursuant
to this section.

end insert

begin insert

begin insert SEC. 4. end insert   

end insert

begin insert Section 8040.2 is added to the end insert begin insert Business and Professions
Code end insert begin insert , to read: end insert

begin insert

begin insert 8040.2. end insert   

(a) On and after January 1, 2018, each registered
corporation arranging for services of shorthand reporting, as
described in subdivision (c) of Section 8040, shall appoint an
individual in this state to act as a designated representative. The
designated representative shall hold a valid certificate as a
certified court reporter in this state or pass an examination
administered by the board pursuant to subdivision (b).

(b) By January 1, 2018, the board shall administer an
examination to determine whether a designated representative of
a registered corporation understands the ethics and professional
conduct required for the practice of court reporting in this state,
the laws and regulations applicable to court reporting in this state,
and the obligations owed by a certified court reporter in this state
to the parties in any reported proceeding.

(c) The board shall issue a certificate to the designated
representative.

(d) The board may revoke the certification of the designated
representative for any violation of the laws or regulations
applicable to a licensee under this chapter. If the certificate of an
appointed designated representative is revoked, the registered
corporation that appointed that designated representative shall
be in violation of this section.

end insert

begin delete SECTION 1. end delete

begin insert SEC. 5. end insert   

Section 8041 is added to the Business and Professions
Code, to read:

8041.  

(a) In addition to any other authority or remedy, the
board may pursuant to this section bring a civil action in a superior
court to enjoin any begin delete person, corporation, or end delete begin insert person or end insert corporation
begin insert whether end insert organized under the laws of begin insert this state or end insert a state of the
United States other than this begin delete state, end delete begin insert state end insert from begin delete rendering end delete begin insert arranging
for end insert court reporter begin delete services end delete begin insert services, end insert begin insert as described in subdivision (c)
of Section 8040, end insert in this state without begin delete ever end delete being begin delete issued a license
by end delete begin insert registered with end insert the board or without authorization to begin delete render end delete
begin insert arrange for end insert court reporter begin delete services end delete begin insert services, end insert begin insert as described in
subdivision (c) of Section 8040, end insert in this state. The board may request
the Attorney General to bring an action pursuant to this subdivision.

(b) If a civil action is brought pursuant to subdivision (a), the
court, in addition to any other remedy authorized by law, shall
impose a penalty of not less than one thousand dollars ($1,000)
and no more than two thousand five hundred dollars ($2,500) per
day against the person or corporation begin delete rendering end delete begin insert arranging for end insert
services without a begin delete license end delete begin insert registration end insert or authorization, and the
court, in addition to any other restitution provided by law, may
also order restitution and the return of any payments made to the
person or corporation.

(c) In an action brought pursuant to subdivision (a), the court,
in addition to any other authority or remedy, may also enjoin a
person or corporation from taking any action that would otherwise
constitute a violation of any begin delete statute end delete begin insert law end insert or regulation of the board
pertaining to impartiality, including, but not limited to, Section
2475 of Title 16 of the California Code of Regulations, and the
court, in addition to any other penalty provided for by begin delete statute end delete begin insert law end insert
or regulation pursuant to this section, may impose a penalty of up
to two thousand five hundred dollars ($2,500) and order restitution
for any acts undertaken by any person or corporation rendering
court reporter services in this state. In determining the amount of
the penalty pursuant to this section, the court shall take into
consideration the frequency of the violations and the impact of
those violations, including a violation of Section 2475 of Title 16
of the California Code of Regulations.

(d) If the board or Attorney General is granted an injunction
pursuant to subdivision (a), the court shall award reasonable
investigation and enforcement costs and may also award a portion
of any unallocated penalties collected pursuant to subdivision (c)
to be used for future investigation and enforcement of this section
by the board and the Attorney General. Any such award of penalties
to the board shall be deposited in the Court Reporters’ Fund and
these penalties shall be subject to appropriation by the Legislature.

(e) This section shall not be construed to change, limit, or alter
any existing authority of the board, including existing injunctive
authority.

begin insert

begin insert SEC. 6. end insert   

end insert begin insert

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.

end insert