Naegeli Charged $11.50 Per Page on a Copy Sale

As explained in August, many court reporting firms attempt to beat the competition through what can be described as cost shifting. The CR firms charge really low on the original transcripts that their clients buy and charge astronomical prices on copy sales in order to make up for the loss. This has a net effect of making it harder for small businesses to compete. As far as I understand, this occurs in many markets in the United States and is not rare, but the news media and government pay little attention to our $3 billion industry, allowing rampant abuse and fraud against our consumers, attorneys across America. Perhaps I should be grateful. The complete failure of the media to provide anything but thinly-veiled marketing for digital court reporting has opened up a special niche for me.

When a source passed me this letter from the late Richard R. Johnson, Esq., I was delighted. It was yet another tangible piece of evidence that the abuse we have, as a field, long suspected was occurring, was actually occurring. After all, we cannot solve problems in our industry without discussing them. For reference, the proceeding occurred in May 2017. The letter was written in June 2019.

Mr. Johnson uses that word “unreasonable.” For many court reporters, that term unreasonable rings a bell, US Legal Support was accused of the same. And we do not have to take his word for it, we have also been provided with a copy of the bill Naegeli sent.

What’s more, my source tells me that the deposition was taken by a digital court reporter named April J. Austin. I hope Austin finds stenography for all the reasons I’ve covered in past articles. I am further informed that Washington is a mandatory CCR state, RCW 18.145.010, which means that the use of digital court reporters is likely illegal. I know what my audience is thinking. “Isn’t that what got StoryCloud in trouble?” Yep. Here are some documents related to that fiasco. For more on the practice of court reporting in Washington State, see RCW 18.145.020.

I asked Naegeli to comment. Naegeli’s Richard Teraci tried to tell me that the reason the copy was so high was because it was an expedite. He also asked me to please remove it from my blog.

A source close to the issue stated that the matter was ultimately concluded by Mr. Johnson consulting a court reporter in Washington State on what a reasonable fee would be for the copy. Mr. Johnson allegedly forwarded that amount to Naegeli and that was the end of the matter. The source also stated that normal copy fees at that time were under $3.25 per page in Washington and that currently a normal copy fee is under $3.50, though some agencies do charge “considerably” more, up to $3.80 per page.

Even without Naegeli’s cooperation, we do have some idea of that Washington market. We also know what Naegeli is looking to pay transcribers on digital matters, so we can work out about what it might have cost Naegeli to produce the transcript. Just for a recap, Naegeli wants to pay transcribers $1.75 per page. That’s about $105 for a 60-page transcript. Succinctly, on a copy sale, it appears that Naegeli intended to charge about 7x what it would have cost to produce the original. For people that don’t understand the way this business works, in conventional court reporting, the original has always been a higher cost than the copy, and the split between court reporters and firms in markets where court reporters aren’t 30 years behind inflation is a lot closer to 50/50 than giving the transcriber a pathetic 15%. This also assumes that the transcriber was given a percentage of the copy money, which is an assumption so generous Robin Hood would probably cringe. Transcribers typically aren’t given anything and may even live offshore.

If those market comparisons are unclear, let’s try some more comparisons. Let’s compare Washington State to New York. In New York, the freelance stenographic reporters routinely make somewhere in the ballpark of 25 cents on a copy. The officials make somewhere in the ballpark of a dollar. As of writing, the cost of living in New York City is about 33% higher than Seattle, so you would expect the New York prices to be somewhere in the ballpark of 33% higher. Again, New York court reporting rates are 30 years behind inflation, meaning New York’s prices should be about double what they are. That would be in the ballpark of $0.50 a copy for freelancers and $2.00 a copy for officials. Assuming a traditional 50/50 split, a reasonable copy could be said to be in the realm of $4.00 per page. The bill from Naegeli is about 3x what is reasonable on a copy and about 7x what it would’ve cost to produce. Even if we buy what Mr. Teraci says about it being an expedite, expedites are usually in the realm of 50% higher price, not triple.

There is also an elephant in the room. The copy sale does not stand alone, it stands alongside whatever Naegeli made on the original. Handing out generous assumptions to prove a point, assume the original was one third of the copy sale. That would be $15.30 per page. If that’s reasonable, then every stenographer in New York City should move to Washington, because our reporters routinely get a comparable amount of work done for $4.50 a page or less. Assuming an expedite, under $6.00 a page. I cannot make it clearer that court reporters can compete with these “large” agencies and probably make more money doing so. The simple truth is every reporter produces most of the work and has none of the overhead. That’s like Walmart treating its workers poorly if every single employee had the ability to compete with Walmart. Agencies have a value, as I will cover in a future post, but their value to us is diminished when they’re not selling steno.

All of these comparisons, of course, are assuming parity with stenographic court reporting. Digital court reporting is not as efficient as stenography, and therefore in any real-world evaluation, that fact must be taken into account. Stenographer rates are being charged for what is an inherently inferior service. Put it this way, digital reporting is so bad that it has to defraud people interested in court reporting to get them to go digital.

May this set the stage for us to discuss price structure as a field. While there are certainly antitrust concerns when court reporters discuss pricing due to our heavy use of independent contractors, it seems reasonable to ask ourselves if this is a fair way for consumers to be treated or business to be conducted. It also seems fair for our trade associations to begin collecting and dispersing historic, regional rate data so that our students can never be taken advantage of again in the way that my generation was.

“…unlikely to raise competitive issues.”

For what it’s worth, Kentucky is leading the charge there.

“The Kentucky Court Reporters Association board has created a salary survey for the benefit of correcting misinformation that is being disseminated.”

Legality aside, imagine if you were the Johnson firm. Is it fair to be locked into a copy sale from a service that can just charge whatever it wants, see if you pay it, and then cut the bill down to a third of what it was if you complain? Reminds me a lot of the way medical billing is today. Think of how happy receiving surprise medical bills makes you. Now, just think, that’s what’s happening every time a law office gets a bill for $11.50 on something where the actual value is about $4.00.

Reporters need to start competing. Digital isn’t cheaper than you and the rapacious behavior of companies like Naegeli is destroying your profession. Our collective job security relies on broadcasting that fact.

Addendum:

I have been informed by its owner that Cover Crow will soon release tools to track and release rate data. This may be an opportunity for associations to get a head start on collection of data from multiple sources.

Upcoming Online Events Court Reporters Are Invited To!

Ana Fatima Costa is presenting a skills workshop tomorrow with Joanna Storey, Esq. It’s going to feature communication tips for attorneys, paralegals, support staff, and court reporters. If you haven’t seen Ms. Costa’s announcement on it, take a look and register now! Thanks to the San Francisco Paralegals Association for putting this on and letting us in! For those of us that missed the September 15 workshop, this is our chance! I’m already registered.

On that same topic of communication, I was also contacted by Kate Nielson and the American Association of University Women. The message was simple: Pay disparity thrives on silence. I wrote to her that a large percentage of our field is female, explained that we are making less than 30 years ago adjusted for inflation, and asked whether she thought we might benefit. Ms Nielson said she’d appreciate me publicizing the event so my audience would be able to join the discussion. If you’re tired of being silent, consider registering now for October 5.

We have so many allies in society. We are not alone, My advice? Jump in! Let Ms. Costa and Ms. Storey talk to you about communication tomorrow; let AAUW talk to you about the importance of breaking silence. Start writing your story. Even if you cannot attend these specific events, get on the mailing list for these associations so that you have a chance to take part in the future.

US Legal Rep: Does It Really Matter If Done Legally and Ethically…?

Lawyers, court administrators, and support staff, there is a real struggle taking place in the United States court reporting industry today. For the last eight years, we have known that there would be a stenographic court reporter shortage. We knew because our national association commissioned the 2013-2014 Court Reporting Industry Outlook by Ducker Worldwide, colloquially known as our Ducker Report. In response to that, many initiatives to recruit stenographers were born including National Court Reporters Association A to Z program, Project Steno, and Open Steno. As of today, there are far more schools for stenographic reporting in the United States than there are for transcribers. If we base our count on NCRA-approved schools against AAERT approved schools, the ratio is about 5:1. Stenographic court reporters are by far better equipped to handle the shortage. But there is a lie being sold about us, our shortage is being exaggerated and exacerbated by companies that stand to profit from it.

In our industry there are stenographic court reporters, voice writers, and digital court reporters. Stenography’s all about taking down verbatim notes on a stenotype. Voice writing is all about speaking into an automatic speech recognition (ASR) system tuned to the reporter’s voice. Digital reporting sees the reporter record the audio, which is then distributed to transcribers. About two years ago a nonprofit called STTI popped onto the field and started spreading the lie that the stenographer shortage would be nearly impossible to solve, citing the Ducker Report and “industry experts” that believed they could predict what the field would look like 20 years from now. They claimed they wanted to be an authority in all speech-to-text modalities but it’s fairly obvious to anyone paying attention that it’s an attack on consumer choice. Ducker could not have been clearer that market preference was stenography:

Court Reporting Industry Outlook 2013-2014, Ducker Worldwide. Page 6.

The conclusions STTI drew were so wrong it appears intentional. Jim Cudahy was the Executive Director of NCRA when the Ducker Report was made, and yet so many years later ended up in the STTI camp using his NCRA experience to help lend credibility to the false idea that our shortage was impossible to solve. An opportunist, he saw a chance to lead the charge into an “emerging” market and he took it, business 101. Large corporations in my field started to push the same lie, likely due to financial pressure. Veritext started trying to train lawyers to allow for digital reporting in their deposition notices, Planet Depos started to build the digital side of its business. Verbit flip flopped between telling investors there was 99% accuracy and that technology would not replace the human. The race was on to legitimize digital reporting in your minds as consumers. This is being done despite some evidence that it would put already-marginalized groups of speakers at risk and the fact that it is less efficient. Utilizing digital reporting would take the production of the transcript offshore, out of range of your subpoena power, and make it much easier for tampering to occur.

If any other field has a shortage, sellers jack up prices. In ours, despite the fact that we are behind inflation in some markets, some of our biggest sellers were now pushing for our replacement. They were telling consumers no stenographer was available, but they weren’t using any of our numerous Facebook groups, LinkedIn, or our national database of stenographers to recruit us. This lie did not go completely unchallenged. Nonprofits like Protect Your Record organized to get the word out, but they were up against corporations that, according to Owler, control a combined revenue amount of over half a billion dollars. Our field, comprised of 88% women, was being bamboozled and blitzed by the message that companies were only going digital out of need. “Of course stenographers are the gold standard, there just are not enough of them.” It was a game of messaging and perception that we were losing.

I had identified a pattern of “shifting narratives” and I used my love of reading and writing to document what I could so that the truth would not be lost. It was through this documentation that the New York State Court Reporters Association, Association of Surrogate’s and Supreme Court Reporters, and many other unions were able to give the New York State Unified Court System a warning on the dangers of automating trial transcription. This work was having a real impact and giving us the power to communicate our importance to the legal field in more concrete terms. Some of my work even got republished by NCRA in industry media and social media. I became a part of changing the false messaging and misconceptions killing my profession.

While court reporters on social media were debating whether companies were utilizing digital court reporters, I was documenting as much as I could and trying to urge my colleagues to push back. My attention was raised to US Legal Support building its digital business and how, in the Holly Moose v US Legal Case, despite 70% of its business coming from court reporters, it claimed it was not organized as a shorthand reporting firm and therefore should be immune to regulations meant to protect consumers in California. Moose lost the case from a failure to prove the injury element, but we now had valuable information, the company was willing to do and say anything to benefit itself. Sounds like a bold claim, but let’s be real, they don’t advertise themselves as “not a shorthand reporting firm.”

Remember, we were 70% of their business as of the Holly Moose case.

While outwardly professing that it wanted stenographers, it was doing everything in its power to sabotage us. Stenotrain was acquired by US Legal and apparently mismanaged into oblivion. US Legal was aggressively recruiting digital court reporters on LinkedIn as recently as May 2021, but no such effort was made to get stenographers. In July 2021, a JD Supra article was put up by the company that claimed the stenographer shortage would be nearly impossible to solve and set up an equation to give it the appearance of credibility. Their numbers were extrapolated from an eight year old report and likely outdated, but even assuming those numbers to be true, the equation, if reiterated in perpetuity, would lead to negative stenographers, which is logically impossible if you’re getting 200 new stenographers a year. The equation assumed the retirements would always be constant and did not acknowledge any of the recruitment efforts at the top of this page. I realized there was a major inaccuracy, and I started to spread the word that we could not rely on these large corporations to be honest with us or our clients.

Reality is simple: Move some numbers around and anything sounds good. But did that make it true? No.

A real breakthrough came when I got a US Legal rep to admit they had not been using NCRA PRO Link / Sourcebook, our national directory of stenographers, to recruit us. How could they dare make a claim that stenographers were not available when they were not utilizing a database consisting of roughly one third of the field? Worse than that, prior to publishing my September 9 article, court reporters reported not being contacted by larger firms. The best we had was a vague promise from Rick Levy that US Legal would look into whether it was “viable” to use the directory to recruit stenographers. After I publicly cried foul, they started to use the directory to recruit stenographers that same day! When it became clear I was going public with these allegations, they went from “looking into it” to attempting to cover up the fraud they had perpetrated on the legal community.

You have to ask yourself why a stenographer living paycheck to paycheck could figure out that the best way to recruit stenographers was to utilize free national resources and the $100 million corporation could not.

There was a part of the puzzle I had and held close to the chest. I had been given emails from the NCRA Firmowners listserv from May 2021 where representatives from US Legal got into a “debate” with a group of court reporters. In my assessment the discussion was rife with obfuscations, distractions, and gaslighting. But their Chief Strategy Officer at the time, Peter Giammanco, gave us a window into what’s going on.

Does it matter if it’s legal? Man’s on a mission.

In a wall of text designed to cast doubt in everyone reading, he writes “Does it really matter if done legally and ethically and both methods end with the same final accurate transcript?” This is an example of the straw man argument. Given that court reporters are twice as good as your average person at taking down dialects like African American Vernacular English (AAVE) even though we have no formal training in it, there is no reason to believe that anyone else will have the same final accurate transcript. These companies won’t tell you that people like Allison Hall are successfully cutting the training time of some stenographers in half or that our recruitment efforts have exploded in the last eight years, they’ll just keep repeating their narrative, and as I just showed you, they do not care if it is legal or ethical. They do not care what is true. The positions they hold are not based on merit or honest debate, they are based on a mission or agenda. This comports with anecdotes I’ve received. Here in New York an acquaintance expressed her desire to leave our field, and US Legal offered her work as a digital court reporter. Meanwhile, these companies are not telling digital reporters that stenographic reporting is an option. Concurrently, companies are telling everyone that stenography is the gold standard and there just aren’t enough of us. Given that it would take as many as eight transcribers to replace a single stenographer, one has to wonder why there was no attempt to encourage digital court reporters to join the gold standard of stenography. It’s a lie so blatant and disgusting that I regularly try reaching out to digital court reporters to let them know what’s coming.

Most of the email images are available for download here. I’d just like to point out from those emails that when dealing with the women of my profession, including the very president of our association, C. Phipps, both men were happy to go on and on bashing NCRA’s organizational approach and falsely accuse L. Freiler of libel. It’s quite telling that when I reached out, there was dead silence.

I publish the emails because this is a matter of public importance. This mission that has been admitted to, to replace stenographers with recorders, will threaten access to justice. It is also almost certainly consumer fraud. What else do you call a concerted effort to make it seem as though stenographers are not available when there has been such an abject failure to attempt to recruit any of them in addition to the incredible mistreatment of the workforce? They rely on our consumers being too busy to pay attention to the situation. Asked for comment by me via email on August 12th, Peter didn’t respond, and US Legal asked me to take them off their mailing list. They’re confident you’re not reading my work or that you will throw your hands up and say “not my problem.” They are counting on you being complicit in the suffering and struggle of our young reporters.

How did we get here? Our field is one of mostly independent contractors. Many of us meet the definition of common law employees, but there’s basically no government enforcement there and so any misclassification claims are handled on a case-by-case basis if they’re raised by the court reporter. The only one I ever read about was settled. As independent contractors, we can be considered competitors with these large firms, and therefore the institutions meant to advocate for us have their hands tied. Our court reporter associations cannot call any one company a liar, lest they be accused of group boycott. They do not allow discussion of rates, lest they be accused of anticompetitive behavior. Thrust into a field where large corporations may assert any false claim without being checked, federally-protected discussions of pay are categorically banned, and almost none of us have the legal knowledge to navigate the nuances of employment law, the stenographic reporter has a whole lot stacked against her. We are a field that largely has none of the employee protections written into law. And we have seen as a society just what corporate culture does to women who have those protections. The stenographic reporter? She prevails despite that.

I may not be a woman, but for a decade I have watched my colleagues recount mistreatment and abuse. I will not stand for it longer. If society is seeking a gender pay gap, it need not look further than this situation we find ourselves in. When our field was male dominated, it rose to such prominence and importance that it has a nonprofit in almost every state dedicated to it. As the field transitioned to majority women, rates were frozen. Adjusted for inflation, the average American worker’s pay rose about 58 cents over the last decade. Adjusted for inflation, the stenographic reporter’s pay fell over the last 30 years, in some cases, by nearly 50%. Corporations have court reporters and captioners working much harder today for far less value than 30 or 40 years ago, have made no genuine effort to fix the shortage situation, and then they have the nerve to tell courts and attorneys we aren’t available. It’s like lighting somebody’s house on fire while they’re sleeping, throwing a few droplets of water on it, and telling the firemen you did your best and there’s nobody in the house to rescue.

We need your help. We need you to take a brief but intense interest in our little field of about 30,000 so that we can continue to serve you and the public. Talk to each other about the court reporting service you’re using, talk to your court reporter, start comparing prices. There is a kind of gambling or cost shifting built into our pricing structure that makes it confusing, but ultimately consumers have the power here. You are some of the most educated people on the planet. Whether by legislation or choice, you can make a profound difference in our future. Pass this up to your bosses. Ask them to read it. Ask them whether these are the kinds of businesses we want to entrust the creation of the legal record to. If you’ve been told a stenographic reporter is not available, consider asking some more questions, because there’s a big chance you’re being lied to. Considering investing in stenographic schools or companies. Consider using PRO Link to find a reporter yourself. And of course consider introducing the recruitment resources at the top of this post to someone in your life. We need stenographic court reporters, and all indications are that we will for a long, long time. For my part in it, I will answer any questions I can at ChristopherDay227@gmail.com.

As in the Columbus Bar Lawyers Quarterly, Spring 2020, Caveat Emptor!

To My Usual Readers:

Court reporters, I stand on the backs of all of you at this point. Without your hard work I wouldn’t have been in a position to publish this story. But if we don’t get it in front of people, this is for nothing. I have made about $400 in donations these past two weeks and I will sacrifice every dime of it to boost this post. If you can afford a donation, please send $20. If you cannot, please consider sending this to lawyers and/or tagging a local bar association on the Facebook and Twitter campaign. They cannot be expected to be experts in our industry. We must guide them. Every state is important, but California, Texas, Illinois, and New York are where the majority of our business is, and where the shortage lies can hurt us most. This is not new. This is something we felt in 2019 and now have much more concrete evidence of.

It’s now clear our institutions are not equipped to handle liars, and it is therefore vital for us to seek out allies among the legal community who will see this for what it is, an attack on their choice as consumers; an attack on their clients’ access to justice; and an attack on a field of women and introverts where it was assumed nobody would have the guts to say anything because nobody has bothered to say anything for at least three decades.

I understand why freelancers are hesitant to speak up against companies. They sign your paychecks. The often unsung threat of them withholding work from you leaves you feeling powerless. But if we want a field that has integrity, then we must act now and sound the alarm so that these levels of dishonesty are never seen again. Court reporting firms need to be at least as terrified of dishonesty as we are of speaking against it. I resigned from my board position and asked you to trust me. Trust that action will spare future generations of reporters from sitting silent as their quality of life is eroded year after year. We have to break the silence on the silent problem facing our nation’s courtrooms and spend just a little energy on writing our own collective story.