BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  June 21, 2016


                   ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS


                                  Rudy Salas, Chair


                     SB 270(Mendoza) - As Amended June 14, 2016


          NOTE:  This bill is double referred, and if passed out of this  
          Committee, it will be referred to the Assembly Committee on  
          Judiciary.


          SENATE VOTE:  29-9


          SUBJECT:  Court Reporters Board of California:  civil actions:   
          registered corporations


          SUMMARY:  Authorizes the Court Reporters Board of California  
          (CRB) to bring a civil action, or request the Attorney General  
          (AG) to bring an action in a superior court to enjoin any person  
          or corporation, from arranging for court reporter services in  
          this state without being registered with the CRB, as specified,  
          and allows for specified penalties; requires, beginning January  
          1, 2018, any corporation organized under the laws of this state  
          or under the laws of another state that arranges for the  
          services of shorthand reporting to register with the CRB;  
          requires the CRB to establish a registration process; authorizes  
          the CRB to take disciplinary action against a registered  
          corporation for acts of unprofessional conduct, as specified;  
          requires a 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  








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          certified shorthand reporter in this state or to pass an  
          examination administered by the CRB; and, authorizes the CRB to  
          charge a fee for the registration of a corporation.     


          EXISTING LAW:   


          1)Provides for the regulation and certification of shorthand  
            reporters by the CRB within the Department of Consumer Affairs  
            (DCA).  (Business and Professions Code (BPC) Section 8000, et  
            seq.)


          2)Prohibits a person from engaging in the practice of shorthand  
            reporting, as specified, unless that person is the holder of a  
            certificate in full force and effect issued by the CRB unless  
            he or she is a salaried, full-time employee of any department  
            or agency of the state who is employed as a hearing reporter.   
            (BPC Section 8016)
          3)Defines the "practice of shorthand reporting" as the making,  
            by means of written symbols or abbreviations in shorthand or  
            machine shorthand writing, of a verbatim record of any oral  
            court proceeding, deposition, court ordered hearing or  
            arbitration or proceeding before any grand jury, referee, or  
            court commissioner and the accurate transcription, thereof.   
            (BPC Section 8017)


          4)Specifies that nothing requires the use of a certified  
            shorthand reporter when not otherwise required by law.  (BPC  
            Section 8017)


          5)Except as specified, prohibits a person, firm or corporation  
            from assuming or using the title "certified shorthand  
            reported" or the abbreviation "C.S.R." or using any words or  
            symbols indicating or tending to indicate that he, she, or it  
            is certified.  (BPC Section 8018)








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          6)Provides the CRB, in addition to its authority to conduct  
            disciplinary proceedings, the authority to issue  
            administrative citations or assess fines for the violation of  
            any rules and regulations adopted by the CRB.  (BPC Section  
            8027.5)


          7)Defines a "shorthand reporting corporation" as a corporation  
            which is authorized to render professional services, as  
            specified in the Corporations Code (CORP) Section 13401, 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 requirements in the Corporations  
            Code.  (BPC Section 8040)


          8)Specifies that each director, shareholder, and officer of a  
            shorthand reporting corporation must be a licensed shorthand  
            reporter.  (BPC Section 8044)


          9)Prohibits a shorthand reporting corporation from doing or  
            failing to do any act which would constitute unprofessional  
            conduct under any statute, rule, or regulation which pertains  
            to shorthand reporters or shorthand reporting.  (BPC Section  
            8046)


          10)Requires a shorthand reporting corporation in conducting its  
            practice to observe and be bound by statutes, rules, and  
            regulations to the same extent as a person holding a license.   
            (BPC Sections 8046)


          11)Requires every person under the jurisdiction of the CRB who  
            holds a license or certificate, or temporary license or  








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            certificate, or business that renders professional services,  
            namely shorthand reporting services, within the meaning of  
            CORP Section 13401, to comply with professional standards of  
            practice, as specified.  (California Code of Regulations Title  
            16 (16 CCR) Section 2475)


          12)Defines "professional services" to mean any type of  
            professional service that may be lawfully rendered only  
            pursuant to a license, certification, or registration  
            authorized by the BPC, the Chiropractic Act, or the  
            Osteopathic Act.  (CORP Section 13401(a))


          13)Defines "foreign professional corporation" to mean 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 authorization in the BPC for the  
            performance of professional services by a foreign professional  
            corporation.  (CORP Section 13401(c))


          14)Defines "professional corporation" to mean a corporation  
            organized under the General Corporation Law, as specified,  
            that is engaged in rendering professional services in a single  
            profession, except as otherwise authorized, pursuant to a  
            certificate of registration issued by the governmental agency  
            regulating the profession as herein provided and that in its  
            practice or business designates itself as a professional or  
            other corporation as may be required by statute.  However, any  
            professional corporation or foreign professional corporation  
            rendering professional services by persons duly licensed by  
            the Medical Board of California or any examining committee  
            under the jurisdiction of the board, the Osteopathic Medical  
            Board of California, the Dental Board of California, the  
            Dental Hygiene Committee of California, the California State  
            Board of Pharmacy, the Veterinary Medical Board, the  
            California Architects Board, the Court Reporters Board of  
            California, the Board of Behavioral Sciences, the  








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            Speech-Language Pathology and Audiology Board, the Board of  
            Registered Nursing, or the State Board of Optometry is not be  
            required to obtain a certificate of registration in order to  
            render those professional services.  (CORP Section 13401(b))


          THIS BILL: 


          15)Provides that 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 specified  
            requirements, if that corporation is registered with the CRB,  
            as specified, and corporations registered with the CRB will be  
            referred to as a "registered corporation."


          16)Requires the CRB on and after January 1, 2018, to implement a  
            registration process, as specified.


          17)States that any law or regulation applicable to a licensee is  
            also applicable to a registered corporation arranging for the  
            services of shorthand reporting, as specified.


          18)Considers a corporation or other entity to be arranging for  
            the services of shorthand reporting in this state if it does  
            any of the following:


             a)   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;
             b)   Determines the amount billed to the parties in a  
               proceeding for any court reporting services performed in  
               this state;








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             c)   Recruits a resident of this state to provide court  
               reporting services or shorthand reporting services; or,


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


          19)States that a corporation registration 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; and, specifies that 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 court  
            reporter. 
          20)States that on and after January 1, 2018, it is unlawful for  
            any corporation, whether foreign or domestic, to arrange for  
            services of shorthand reporting, 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 CRB.


          21)Requires a corporation registering with the CRB to file an  
            application with the CRB on a form prescribed by the CRB.


          22)Requires the application for registration to include, but not  
            be limited to the following:


             a)   The federal identification number of the applicant;








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             b)   The name of the individual who will be appointed as a  
               designated representative of the applicant, and any other  
               identifying information, as specified;


             c)   Any required fee; and,


             d)   All information required to complete the application.


          23)Requires on and after January 1, 2018, each registered  
            corporation arranging for services of shorthand reporting to  
            appoint an individual in this state to act as a designated  
            representative,  who may hold a valid certificate as a  
            shorthand reporter or pass an examination administered by the  
            CRB.
          24)Requires the CRB, by January 1, 2018, to 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 owned by  
            a certified court reporter in this state to the parties in any  
            reported proceeding.


          25)Requires the CRB to issue a certificate to a designated  
            representative.


          26)Authorizes the CRB to revoke the certification of a  
            designated representative for any violation of the laws or  
            regulations applicable to a licensee, if the certificate of an  
            appointed designated representative is revoked, the registered  
            corporation that appointed that designated representative is  
            in violation.










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          27)Permits the CRB, in addition to any other authority or  
            remedy, to bring a civil action in a superior court to enjoin  
            any person or corporation organized under the laws of this  
            state or another state from arranging for court reporter  
            services in this state without being registered with the CRB  
            or without authorization to arrange for court reporter  
            services, as specified, in this state, and permits the CRB to  
            request the AG to bring an action.  


          28)States that if a civil action is brought, the court, in  
            addition to any other remedy authorized by law, must impose a  
            penalty of not less than $1,000 and no more than $2,500 per  
            day against the person or corporation rendering services  
            without a license 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.  


          29)Authorizes the court, in addition to any other authority or  
            remedy, if an action is brought, to also enjoin a person or  
            corporation from taking any action that would otherwise  
            constitute a violation of any statute or regulation of the CRB  
            pertaining to impartiality, including but not limited to  
            violation of the professional standards of practice of the  
            CRB, and provides that the court, in addition to any other  
            penalty provided for by statute or regulation, may impose a  
            penalty of up to $2,500 and order restitution for any acts  
            undertaken by any person or corporation rendering court  
            reporter services in this state.


          30)Requires the court in determining the amount of the penalty  
            referenced in 14) above, to take into consideration the  
            frequency of the violations and the impact of those  
            violations, as specified. 










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          31)Requires the court to award reasonable investigation and  
            enforcement costs to the CRB or the AG if an injunction is  
            granted, as specified, and also authorizes the court to award  
            a portion of any unallocated penalties collected, as  
            specified, to be used for future investigation and  
            enforcement, and requires any penalty awarded to the CRB to be  
            deposited in the Court Reporter's Fund, which is subject to  
            appropriation by the Legislature.


          32)States that numbers 13)-17) above cannot be construed to  
            change, limit, or alter any existing authority of the board,  
            including existing injunctive authority.


          33)Authorizes the CRB to establish a fee for a corporation to  
            register with the CRB in a fixed amount not to exceed the  
            reasonable regulatory cost of preparing and administering the  
            registration process. 


          FISCAL EFFECT:  According to the Senate Appropriations Committee  
          Analysis dated May 18, 2015, this bill will result in "unknown  
          additional CRB enforcement costs, dependent upon the number of  
          complaints investigated and enforcement actions.  If additional  
          staff is needed, costs could be in the range of $100,000  
          annually." This bill will also result in "unknown additional  
          fine revenues, which are also dependent upon the number of  
          successfully adjudicated cases.  In addition, there could be  
          reimbursements for enforcement and investigation costs that are  
          awarded by the courts."


          COMMENTS:  


          Purpose.  This bill is sponsored by the  California Court  
          Reporters Association  .  According to the author, "[this bill]  
          strengthens the authority of the CRB to regulate or prevent  








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          unlicensed individuals and corporations from unlawfully  
          rendering court reporting services in California by issuing  
          fines or injunctions for acts in violation of the CRB's  
          professional and ethical rules for certified shorthand  
          reporters.  

          Under current law, the CRB has limited authority to impose  
          penalties on any court reporter or court reporting corporation  
          that is rendering services without a court reporting license.  
          However, for unlicensed entities, the CRB has had challenges in  
          imposing fines for any violations. This has jeopardized the  
          integrity of the court reporting profession and places at a  
          disadvantage licensed businesses that provide court reporting  
          services." 

          Court Reporters Board.  The CRB is responsible for licensing and  
          disciplining certified shorthand reporters.  Certified shorthand  
          reporters are responsible for reporting depositions in legal  
          cases as well as court proceedings.  Since 1972, the CRB has  
          permitted the certification of individuals and at one time, the  
          registration of shorthand reporting corporations.  Currently,  
          the CRB oversees approximately 7,000 certified shorthand  
          reporters. The CRB establishes the educational requirements for  
          certification including authorizing the minimal educational  
          standards and approving schools.  In order to qualify for  
          licensure as a certified shorthand reporter, an individual must  
          have a high school education, twelve months (or 1,400 hours) of  
          full-time work experience related to making records of hearings,  
          obtain a passing score on the California State Hearing Reporters  
          Examination, and complete a course from an approved  
          court-reporting school.  Currently, in California, certified  
          shorthand reporters work in two separate capacities: 1) as an  
          "official reporter" who works as a court reporter employed by a  
          state court, or 2) as a "freelance reporter" who is hired  
          privately by court reporting businesses, firms, or attorneys to  
          report depositions.  Both official and freelance reporters are  
          required to meet the same educational and examination  
          qualifications.  Currently, the CRB does not separately license  
          or register court reporting corporations.  








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          Enforcement Authority. In addition to the CRB's licensing  
          function, the CRB is also tasked with enforcement-related  
          activities for shorthand reporters who violate the practice act.  
           BPC Section 8025 states that a certificate to practice as a  
          shorthand reporter may be suspended, revoked, or denied, or  
          other disciplinary action may be taken against a certificate  
          holder for multiple reasons including the conviction of a  
          misdemeanor if the misdemeanor is substantially related to the  
          functions and duties of a court reporter, fraud or  
          misrepresentation in obtaining a certificate, unprofessional  
          conduct, or loss or destruction of stenographic notes that  
          prevents the production of a transcript, among others.  In  
          addition to the provisions of BPC Section 8025, the CRB  
          specifies through regulation the professional standards of  
          practice (16 CCR Section 2475) for professionals, which include  
          acting without bias toward, or prejudice against, any parties  
          and/or their attorneys; not entering into, arranging, or  
          participating in a relationship that compromises the  
          impartiality of the certified shorthand reporter, including but  
          not limited to a relationship in which compensation for  
          reporting services is based upon the outcome of the proceeding;  
          and maintaining confidentiality of information, among others. 

          Under current law, the CRB has the authority to carry out its  
          licensing and enforcement authority against any person or  
          corporation, as defined in CORP Section 13401.  According to the  
          author, the CRB has limited authority to impose penalties on any  
          court reporter or court reporting corporation that is rendering  
          services without a court reporting license.  While the CRB does  
          not register or certify corporations in California, BPC Sections  
          8044 and 8046 provide the CRB with the explicit authority over  
          corporations incorporated in California because each director,  
          shareholder, and officer of a shorthand reporting corporation is  
          required to be a licensed shorthand reporter; however, the same  
          authority is not specified in statute for foreign corporations  
          providing or arranging for court reporting business in  
          California.  This bill aims to increase the CRB's disciplinary  








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          reach to include those entities or corporations who may be  
          arranging for shorthand reporting services by permitting the CRB  
          to discipline entities who are in violation of professional  
          standards as regulated by the CRB, or other violations of the  
          practice act, and by establishing a certification process for  
          corporations who are arranging for shorthand reporting services,  
          but where each director, shareholder, or officer is not a  
          California licensed shorthand reporter.   

          Scope of Practice.  BPC Section 8017 defines shorthand reporting  
          as the making by means of written symbols or abbreviations in  
          shorthand or machine shorthand writing, of a verbatim record of  
          any oral court proceeding, deposition, court ordered hearing or  
          arbitration , or proceeding before any grand jury, referee, or  
          court commissioner, and the accurate transcript thereof.

          16 CCR Section 2403 further specifies that the practice of  
          shorthand reporting includes services for actions in superior  
          court such as delivering a copy of the original transcript in a  
          computer-readable form, as specified, labeling disks of  
          transactions with the case name and court number, and the dates  
          of the proceedings contained on the disk, among others.  For a  
          deposition, 16 CCR Section 2403 includes making a full or  
          partial copy of a transcription available, notifying all parties  
          who attended a deposition of requests made by other parties for  
          either an original copy of the transcript, or any portion  
          thereof, and securely sealing the transcript in an envelope or  
          package, as specified.  

          This bill does not alter the current practice of shorthand  
          reporting; however, this bill requires corporations who arrange  
          for shorthand reporting services, which may include some of the  
          activities contained within the shorthand reporters' scope of  
          practice, to register with the CRB.   

          Professional Corporations and The Moscone-Knox Professional  
          Corporation Act (Act).  BPC Section 8044 specifies that each  
          director, shareholder, and officer of a shorthand reporting  
          corporation must be a licensed shorthand reporter.  Business  
                                                      







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          models for shorthand reporting corporations and other service  
          providers vary throughout the state.  While there are a number  
          of licensee-owned corporations in California, there are a number  
          of businesses that do not hold themselves out to be court  
          reporting corporations.  These corporations claim to be  
          litigation service providers that only arrange for court  
          reporting services, but are not actually responsible for the  
          making of the written record.  

          There are several other regulatory entities under the DCA that  
          have established some form of registration or a licensure  
          programs for both foreign and domestic corporations.  Those  
          entities include the Board of Pharmacy, the Bureau of Real  
          Estate Appraisers, and the Contractors State License Board,  
          among others.  

          According to the author, the need for this bill is in response  
          to the CRB's inability to take the appropriate disciplinary  
          actions against a corporation who was accused of operating in  
          violation of the CRB's professional standards of practice;  
          specifically, 16 CCR Section 2475(b)(8) which prohibits any  
          person or business under the jurisdiction of the CRB from either  
          directly or indirectly giving or receiving any gift, incentive,  
          reward, or anything of value to or from any person or entity  
          associated with a proceeding being reported that is more than  
          $100.  
          
          Court Reporters Board of California v. U.S. Legal Support, Inc.,  
          1-11-CV197817.  In 2010, the CRB took disciplinary action  
          against a corporation, charging it with violating 16 CCR Section  
          2475(b)(8) by issuing a citation and fine.  The corporation  
          argued that the CRB lacked the jurisdictional authority to issue  
          a citation to the company, and did not pay the fine.  


          As a result, a formal case was brought against U.S. Legal  
          Support, Inc. in 2012. The court held that the CRB lacked the  
          jurisdictional authority to issue citations and fines to an  
          out-of-state corporation rendering court reporting services in  








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          California without authorization to do so.  As the court noted  
          in its decision, although U.S. Legal Services, Inc. was  
          rendering court reporting services in California and was in  
          violation of the gift giving rules as defined in the CRB's  
          regulations, there was no explicit authority in statute  
          authorizing CRB to impose citations or fines because the  
          corporation was not authorized to do business in California  
          under the BPC.  In addition to other legal remedies, this bill  
          will authorize the CRB, under this new section, to bring an  
          action or request the AG to bring an action to enjoin any  
          unlicensed or unauthorized person, or any domestic or foreign  
          corporation from rendering court reporter services in this state  
          and in doing so, seek certain penalties including fines and  
          possibly restitution.  


          The issue of professional conduct was raised in the CRB's 2015  
          Sunset Review Report.  As noted in the Committee Background  
          Paper, according to the CRB, additional complaints have been  
          received about overcharging for court transcripts, a violation  
          of Government Code 69950 and is direct consumer harm; the  
          overcharging of one party for transcripts is in practice  
          cost-shifting, or akin to giving a large gift. This is a  
          practice whereby a court reporting firm offers to charge the  
          noticing party a nominal amount if the noticing party chooses to  
          utilize the services of that firm. The costs of the transcripts  
          are then shifted over to the defending attorney(s), who has no  
          ability to choose the shorthand reporter and is essentially  
          stuck with the bill presented in order to obtain a transcript.  
          While the practice is not specifically illegal on its face, the  
          CRB is concerned about the serious ethical considerations that  
          arise out of this type of scenario. As a result, it is important  
          for the CRB to ensure that the same rules that apply to all  
          licensees that serve to protect consumers are enforced against  
          all entities that provide shorthand reporting services.


          If a corporation is providing shorthand reporting services by  
          way of contracting with or hiring California-licensed court  








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          reporters and violates the professional conduct standards, then  
          this bill will specifically authorize the CRB to bring an action  
          (or request the AG to bring an action) to enjoin a corporation,  
          or corporation organized under another state, from rendering  
          shorthand reporting services in California without ever being  
          issued a license by the CRB or authorization to render court  
          reporter services in California.  In addition, this bill would  
          authorize the CRB to collect specified penalties against  
          corporations who may be in violation.  This bill also seeks to  
          establish a new registration process for corporations who  
          arrange for the services of shorthand reporting in order to  
          comply with the unprofessional conduct standards as specified  
          through regulation.  


          Current Related Legislation.  AB 2192 (Salas, Hill) of the  
          current Legislative Session, extends the sunset date for the CRB  
          and its executive officer.  Although the bill does not address  
          court reporting corporations, the issue was raised in the sunset  
          review hearing on March 9, 2016.  STATUS: This bill is pending  
          in the Senate Committee on Business and Professions.


          Prior Related Legislation.  AB 1461 (Ruskin) of 2009, would have  
          prohibited a firm, partnership, sole proprietorship, or other  
          business entity providing or arranging for shorthand reporting  
          services, from doing or failing to do any act that constitutes  
          unprofessional conduct under any statute, rule or regulation  
          pertaining to shorthand reporters or shorthand reporting.  NOTE:  
           This bill was held in the Assembly Committee on Appropriations.  
           
          
          ARGUMENTS IN SUPPORT: 


          The  California Court Reporters Association  writes in support,  
          "In response to last year's committee dialogue on this bill, SB  
          270 has been amended to also create a pathway for corporations  
          to lawfully arrange for shorthand reporting services in the  








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          state. Specifically, this bill allows a corporation, either  
          domestic or foreign, that is not headed by a licensee to  
          register with the board before arranging for any shorthand  
          reporting services in the state. This registration would ensure  
          that the corporation is under the jurisdiction of the board and  
          therefore must follow California law related to court reporting  
          services."





          ARGUMENTS IN OPPOSITION:


           Esquire Deposition Services, LLC  ,  Magna Legal Services  ,  U.S.  
          Legal Support, Inc.   Veritext Corp  , and  Litigation Services  write  
          in opposition, "As amended, [this bill] proposes a registration  
          scheme for companies which 'arrange' for services of shorthand  
          reporting in California.  As drafted, this registration approach  
          has many of the attributes of traditional licensing, but the  
          language fails to answer basic licensing questions, such as  
          which companies can and must register, and which activities will  
          be subjected to regulation.  There are basic terms which go  
          undefined, transition questions not answered, an examination  
          proposed with little detail, inaccurate descriptions of business  
          entities and more.  Read literally, the bill could require  
          registration from an almost unlimited number of businesses."


          POLICY ISSUES:


             1)   This bill seeks to create parity for licensee-owned  
               shorthand reporting corporations and those corporations  
               that are non-licensee owned to ensure that both types of  
               corporations are subject to the same enforcement standards.  
                Currently, the CRB can only take action against its  
               licensees, which leaves shorthand reporting corporations  








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               exempt from CRB oversight.  It is unclear if this bill  
               solves the problem it is attempting to address.



          BPC Section 8044 specifically requires that a shorthand  
          reporting corporation is entirely controlled by a certified  
          shorthand reporter or group of licensees.  However, as currently  
          drafted, it is unclear if all corporations owned by a licensee  
          or not, would be required to register.  





             2)   This bill permits a corporation to operate in California  
               and requires it to register with the CRB if they are  
               arranging for shorthand reporting services.  As noted  
               earlier, the scope of practice for a shorthand reporter may  
               contain actions which may include merely arranging  
               shorthand reporting services.  However, the larger question  
               of whether a corporation's action of arranging for  
               shorthand reporting services is considered within the scope  
               of practice of a certified shorthand reporter remains  
               unanswered in this bill.
          IMPLEMENTATION ISSUES:


             1)   This bill will prohibit a corporation, whether foreign  
               or domestic, from arranging for shorthand reporting  
               services without first registering with the CRB; and, as  
               part of that registration process the corporation is  
               required to appoint an individual in this state as a  
               designated representative, which can be a licensee or a  
               person who has passed a CRB-administered examination.  As  
               currently drafted, it is unclear what the enforcement  
               process is for revoking, suspending or placing other  
               probationary conditions upon a designate representative of  
               a corporation (given they are not a licensee). If the  








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               designated representative forcibly or voluntarily leaves  
               the corporation, can the corporation simply appoint a new  
               representative and unprofessional conduct can continue?    
               Additionally, if the corporation is found to have violated  
               provisions of the practice act, is the designated  
               representative the receiver of disciplinary action, if any?  
                The author may wish to clarify how the designated  
               representative can be disciplined.





             2)   As drafted, this bill refers only to court reporting  
               corporations. It is unclear if the intent of the bill is  
               address only corporations that provides shorthand reporting  
               services to the courts. The author may wish to clarify if  
               this bill is intending to capture all shorthand reporting  
               corporations.
          AMENDMENTS:


          In response to concerns raised above, the author may wish to  
          consider amending the bill to instead require all corporations  
          to abide by the prohibition on gift giving as specified in 16  
          CCR Section 2475(b)(8), and other ethical guidelines as is  
          required for all certified shorthand reporters, as follows:  


             (a)  Any domestic or foreign corporation that offers to  
               arrange for or arranges for the services of shorthand  
               reporting as defined in Section 8017, whether through an  
               employee or an independent contractor, shall comply with  
               all of the following:

               (1)    Act without bias toward or prejudice against any  
                 parties and their attorneys.

               (2)    Not enter into, arrange, or participate in a  








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                 relationship that compromises the impartiality of the  
                 certified shorthand reporter, including, but not limited  
                 to, a relationship in which compensation for reporting  
                 services is based upon the outcome of the proceeding.

               (3)    (A) Except as specified in subparagraph (B), not  
                 directly or indirectly give or receive any gift,  
                 incentive, reward, or anything of value to or from any  
                 person or entity associated with a proceeding being  
                 reported, including, but not limited to, attorneys or an  
                 attorney's family members, employees of attorneys or an  
                 employee's family members, law firms as single entities,  
                 clients, witnesses, insurers, underwriters, or any agents  
                 or representatives thereof.

               (B)    A corporation may: 

               (i)       Receive compensation for the arrangement of  
                    shorthand  reporting services

               (ii)      Give or receive items that do not exceed $100 in  
                    the aggregate for any combination of items given or  
                    received per calendar year to or from an attorney or  
                    an attorney's family members, an employee of an  
                    attorney or an employee's family members, a law firm  
                    as a single entity, a client, a witness, an insurer,  
                    an underwriter, or any agent or representative  
                    thereof.

               (iii)     Provide services without charge or compensation  
                    for which the certified shorthand reporter reasonably  
                    expects to be reimbursed from the Transcript  
                    Reimbursement Fund, established in Section 8030.2, or  
                    otherwise for an indigent person as defined in Section  
                    8030.4.

             (a)  The board, the Director of Consumer Affairs, and the  
               Attorney General have jurisdiction to enforce the  
               provisions of this section. 








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          REGISTERED SUPPORT:


          California Court Reporters Association (sponsor)
          American Reporting Services, LLC
          Northern California Court Reporters Association
          The San Diego Superior Court Reporter Association

          REGISTERED OPPOSITION:


          Esquire Deposition Services, LLC 
          Litigation Services
          Magna Legal Services 
          U.S. Legal Support, Inc. 
          Veritext Corp.


          Analysis Prepared by:Elissa Silva /Gabby Nepomuceno B. & P. /  
          (916) 319-3301