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Friday, August 26, 2016

Department of Justice Highlights Consumer Benefits of Competition Among Court Reporters

Antitrust Division Urges California State Assembly to Consider Potential Anticompetitive Effects of Proposals to Ban or Limit Third-Party Court-Reporting Contracts

The Department of Justice’s Antitrust Division today submitted a statement on the potential anticompetitive effects of legislative proposals that could result in a ban or limitation on contracts between local California court reporters or service firms and third parties, such as insurance companies, for more than one deposition at a time, also known as third-party contracts.  Such regulation of court-reporting services can raise barriers to entry, restrict competition and limit potentially cost-saving options available to consumers.    Accordingly, the division recommended carefully weighing the potential competitive costs of any proposals to restrict competition in court-reporting services against any demonstrated risk these contracts could pose to the integrity of court reporting, and as a result, to the judicial process. 

The division also noted that restrictions on the ability of court reports to enter third-party contracts should be imposed only where there is credible evidence of a significant risk of harm to the judicial process.  Any restrictions should be narrowly tailored to address the harm and not discourage innovative contract terms to deliver court-reporting services for the benefit of consumers.

“Consumers benefit when a competitive marketplace presents them with a wider variety of services,” said Acting Assistant Attorney General Renata Hesse of the Justice Department’s Antitrust Division.  “When analyzing legislation that could result in a ban or limitation of third-party court-reporting contracts, the California State Legislature should consider a company’s ability to realize significant savings under a third-party court-reporting contract and pass savings on to its customers.”

The statement is in response to a request from California Assemblyman Scott Wilk.  The request asked for views on potential legislative proposals that would subject out-of-state court reporter service provider firms to the jurisdiction of the California Court Reporters Board, which could have the effect of banning or limiting the use of multi-case third-party contracts.

Letter to Assemblyman Wilk

Press Release Number: 
Updated December 29, 2016