Assembly Bill 1197

Effective January 1, 2016, legal professionals who prepare deposition notices have new disclosure obligations per Assembly Bill 1197, the John Zandonella Act of 2015.

• If you have been instructed by your client or a third party paying your bills for deposition services to use a particular court reporter, reporting firm or corporation, then you must, after January 1, 2016, disclose that fact in the Notice of Deposition.

• If you know that a contract between your client or a third party paying your bills for deposition services and a court reporter, reporting firm or corporation exists, you have to disclose that in the Notice of Deposition.

If you or your law firm have been a victim of “cost shifting” (a practice in which the pricing of the deposition services is grossly inflated to the non-noticing party, to recoup losses from discounted or free services offered to the contracted party that has noticed the deposition), by a court reporter, reporting firm or corporation, AB 1197 requires disclosure in the deposition notice in order to provide you or your law firm the opportunity to object to the contracted reporter.  The contract disclosure requirements of AB 1197 allows the litigants to determine whether the contracted arrangements are acceptable or whether they could affect the impartiality of the court reporter.

Under CCP 2025.410, objections from opposing counsel must be filed three calendar days prior to the day of the deposition and cannot be used as a basis for suspending the deposition if raised on the day of the proceeding.

Under CCP 2025.320(e), Any objection to the qualifications of the deposition officer is waived unless made before the deposition begins or as soon thereafter as the ground for that objection becomes known or could be discovered by reasonable diligence.

Please click on this link if you would like more detailed information on AB 1197 http://www.ab1197.com/

Section 2025.220 of the Code of Civil Procedure dealing with deposition notices was amended by AB 1197 to read as follows (the entire language of CCP 2025.220 can be read in the link or the attachment to this email):

(a) A party desiring to take the oral deposition of any person shall give notice in writing.  The deposition notice shall state all of the following:……

…….(8)(A)  A statement disclosing the existence of a contract, if any is known to the noticing party, between the noticing party or a third party who is financing all or part of the action and either of the following for any service beyond the noticed deposition:

(i)  The deposition officer.

(ii) The entity providing the services of the deposition officer.

(B) A statement disclosing that the party noticing the deposition, or a third party financing all or part of the action, directed his or her attorney to use a particular officer or entity to provide services for the deposition, if applicable.    ………..

Sample language for notice of deposition may be as follows and is also attached to this email:

• The undersigned counsel has been directed to use the court reporting firm that will be used to report the deposition.

• There is a contract between the party noticing this deposition or the entity financing the litigation and the court reporting firm that will be used to report the deposition.

• The aforementioned contract includes the court reporting firm providing services beyond deposition services.

Important brief information that is contained in the link and in the attachments to this email:

Assembly Bill 1197, the John Zandonella Act of 2015, authored by Assembly person Susan Bonilla and sponsored by CalDRA and supported by Consumer Watchdog, Consumer Attorneys of California and California Official Court Reporters Association (COCRA), was signed into California law by Governor Brown on September 28, 2015.  The bill is intended to address so-called “contracting” in the court reporting industry by requiring disclosure of contracts, if any are known, between the party noticing or paying for the deposition and the entity performing the services of the deposition officer.

Why was AB 1197 necessary?

Certain practices engaged in by non-licensee corporate providers – practices labeled as “unsavory” by one California legislative committee – have gotten the attention of attorneys and the California Legislature.  Chief among these practices that has caught the attention of attorneys and the Legislature is cost shifting by these court reporting corporations, the practice of charging higher-than-normal rates for certified copies to compensate for the low contract rates the corporations are giving their clients on the original in exchange for entering into exclusive contracts.  Cost shifting hurts any party defending a deposition, whether a plaintiff, defendant or co-defendant.

The non-licensee-owned corporations are cost shifting so flamboyantly that attorneys and the Legislature have been audibly grumbling about it.  Here is why:  A noticing attorney can shop for the best price and service for the Original and one copy.  That attorney can take it or leave it.  But the copy-ordering attorneys can’t shop around for their copies.  If they want a copy, there is only one place the attorney can get it, from the reporting entity chosen by the noticing attorney.

As the Assembly Judiciary Committee analysis of AB 1197 observed:  “Due to the widespread use of these exclusive contracts and the subsequent problems these relationships present to the legal profession, many states have stepped in to regulate these practices.  Currently, 17 states have prohibited or limited these relationships.”  The unanimous vote for AB 1197 (Bonilla) in the Legislature over the opposition of the nation’s biggest court reporting corporations shows how widely the practice is disdained, and the need to do something about it.