COURT REPORTERS – FINRA ARBITRATION – RULE 12606

My firm recently stenographically reported a two-week FINRA arbitration in Boston.  Typically, there is no court reporter present for FINRA arbitrations.  The official record is a simple cassette tape recorder that is turned on and off by one of the arbitrators.  Attorneys who wish to have their record will hire a court reporter to create a transcript and/or give out roughs each day.

We have reported FINRA arbitrations in the past, and I had never realized that, according to FINRA rules, the court reporter is not to offer the opposing counsel access to the transcript without permission from the firm that hires the court reporter.  This rule is absolutely contradictory to what I thought I knew for sure, if a court reporter is creating a record, each party has a right to that record and can buy a copy.

FINRA Rule 12606 Record of Proceedings states:  “The Customer Code applies to claims filed on or after April 16, 2007.  In addition, the list selection provisions of the Customer Code apply to previously filed claims in which a list of arbitrators must be generated after April 16, 2007; in these cases, however, the claim will continue to be governed by the remaining provisions of the old Code unless all parties agree to proceed under the new Code.

(a)   Tape, Digital, or Other Recording

(1)   Except as provided in paragraph (b), the Director will make a tape, digital, or other recording of every hearing.  The Director will provide a copy of the recording upon request for a nominal fee.

(2)   The panel may order the parties to provide a transcription of the recording.  If the panel orders a transcription, copies of the transcription must be provided to each arbitrator and each party.  The panel will determine which party or parties must pay the  cost of making the transcription and copies.

(3)   The recording is the official record of the proceeding, even if it is transcribed.

(b)   Stenographic Record

(1)    Any party may make a stenographic record of the proceedings.  Even if a stenographic record is made, the tape, digital, or other recording will be the official record of the proceeding, unless the panel determines otherwise.  If the panel determines in advance that the stenographic record is the official record, the Director will not record the hearing.

(2)   If the stenographic record is the official record of the proceeding, a copy must be provided to the Director, each arbitrator, and each other party.  The cost of making and copying the stenographic record will be borne by the party electing to make the stenographic record, unless the panel decides that one or more other parties should bear all or part of the costs.

In my particular situation, the opposing party to the firm that hired us asked to purchase a transcript subsequent to the arbitration.  My client informed me that he would not give us permission to sell/provide the transcript to the other side.  I asked my client to cite me language that would prevent me from selling the transcript, and he sent me FINRA Rule 12606.

My attorney’s interpretation of the rule is unless the Director deems the stenographic record the official record, we are only taking notes or providing work product for the party that hired us, and we are not allowed to provide the transcript to any other parties.

As court reporters reporting FINRA arbitrations, it is wise to know Rule 12606 and educate the attorneys.

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Arbitration Blog

American Arbitration Association – Consumer Arbitration Rules – Who Pays for the Court Reporter?

Arbitration Blog

Even for binding arbitrations, a record of the proceedings may be important for the attorneys and the arbitrator, especially when there are many witnesses and the subject matter is complex. Having computers or tablets with the transcript available to the parties in real-time is an effective tool for counsel when cross-examining a witness.

Our court reporting firm specializes in arbitrations that we host at our Discovery Conference Centre. The question has come up, “Who pays for the court reporter?” The majority of the time, the parties agree to share the per diem for the court reporter, the time that a court reporter is writing the proceedings, but what if one party wants a court reporter present to provide rough drafts and real-time, and the other party doesn’t? What happens in the scenario when the party that didn’t want a court reporter present and didn’t agree to share in the cost of the per diem, after the arbitration has started, wants to order a rough draft or partial final transcript?

In doing research, I found the following Rule from the AAA Consumer Arbitration Rules:

R-27 – Written Record of Hearing

  • If a party wants a written record of the hearing, that party must make such arrangements directly with a stenographer (court reporter) and notify the opposing parties, the AAA, and the arbitrator of these arrangements at least three business days before the hearing. The party or parties who request the written record shall pay the cost of the service.
  • No other type of recording will be allowed unless the parties agree or the arbitrator directs a different type of recording.
  • The arbitrator may resolve disputes between the parties over who will pay the costs of written record or other type of recording.
  • The parties can agree or the arbitrator may decide that the transcript (written record) is the official record of the hearing. If it is the official record of the hearing, the transcript must be given to the arbitrator and made available to all the parties so that it can be reviewed. The date, time, and place of the inspection will be decided by the arbitrator.

Court reporters want to do the right thing and provide transcripts, rough drafts, and real-time to anyone who makes the request, offering the same services to every party. Looking at FINRA Rule 12606 the court reporter is only a   note-taker and is NOT to provide transcripts to all parties unless the panel decides the transcript is the official record. CA CCP Section 2025.310 – 2025.340 tells the deposition officer he/she must offer to provide the same services to all parties at the same time.

The AAA, Consumer Arbitration Rules, makes it clear the parties who want the written record shall pay for the cost of the service, and if there is any dispute, the arbitrator will resolve the dispute.

 

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Court Reporters and Legal Videographers – On and Off the Record – Federal Rules v. CA CCP

Court reporters and legal videographers need to know when to be on and off the record.  The first thing the court reporter needs to know is what jurisdiction the deposition they are reporting falls under.  Is it a California state court case?  Is it a Federal district court case?  Is it a FINRA arbitration?

Under the California Code of Civil Procedure, CCP 2025.470, the court reporter may not go off the record without stipulation by all counsel unless a party or the deponent moves for a protective order.  Unless the court reporter hears the two words “protective order,” she/he must stay on the record.  I would suggest that the videographer would fall under the same rule.

Under Rule 30(d)(3) of the Federal Rules of Civil Procedure a litigant may suspend a deposition at any point for the purpose of filing a motion to terminate or limit the deposition on the grounds that it is being conducted in a manner that unreasonably annoys, embarrasses or oppresses the deponent or the litigant.  If such a suspension is sought, the deposition remains postponed until such time as the court issues an order.

I believe a best practice in a district court case or any deposition that falls under the Federal Rules is for the court reporter/videographer to stay on the record until all counsel agree to go off the record or the parties physically leave the deposition (and the parking lot).  The party or parties need to really leave, not just threaten to leave and walk out for a couple of minutes.  As a court reporter I wait for the remaining party to give me permission to pack up and leave.

As I have written in a previous blog, at a FINRA arbitration, the court reporter goes off and on the record at the request of whomever is hiring the court reporter unless the court reporter has been designated by the arbitration panel to be keeping the official record (rather than the tape recording being the official record).

When asked to go off the record, I get a verbal agreement by all parties, I put my hands up in the air, and say in a strong voice with a smile, “We are off the record.”  I want to always guarantee there was no misunderstanding and that no one can later say, “I never agreed to go off the record.  I wanted you to transcribe the part when John Smith called me a blankety-blank.”

Court reporters have a duty to protect the transcript and know when to be on or off the record.

 

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