The following is an article in the Courthouse News Service of May 13, 2013, in Detroit, Michigan.

This is indeed a sad story where court reporter indecently over manny years steals from their fellow court reporters who are all subcontractors. If you have worked for them, as you read this, you may discover you are also a victim and owed money.

Posted on LinkedIn in Court Reporter Net - and on other Linkedin court reporter forums - hopefully to be read by all court reporters who believe they have been violated as described below in detail.

DETROIT (CN) - Twenty-six court reporters claim Bienenstock & Associates, Michigan's largest court reporting firm, "stole" more than $1 million from them by lying about how much it charged clients, and "bullied their employees with temper tantrums and threats of termination" to keep "their unethical and unlawful business practices" hidden.

Susan Lowry and 25 other court reporters sued Lauren Bienenstock & Associates Inc., Lauren Bienenstock, and Samuel Bienenstock in Macomb County.

Twenty-three of the 26 plaintiffs are women. All the plaintiffs are all licensed court reporters who worked as independent contractors for Bienenstock & Associates.

"This case is about greed, deception and betrayal, the 27-page complaint begins. "Twenty-six licensed court reporters are suing Michigan's largest and best-known court reporting firm to recover over $1 million they believe has been stolen from them by Lauren and Samuel Bienenstock and their court reporting firm. Many more potential plaintiffs are waiting in the wings, so terrorized by the Bienenstocks' promises of retribution that they fear public identification.

All of these court reporters, many of who have provided services to the largest law firms and most prominent lawyers practicing in Michigan and throughout the United States, have one thing in common: the Bienenstocks have misled them, lied to them, and stolen huge sums of money from them for almost 20 years, all while pretending to act on their behalf and in their best interests.

"The Bienenstocks' scheme was simple: use every possible tactic to convert payments from attorneys and law firms for plaintiffs' court reporting services to their own use, despite their agreement with plaintiffs that at least 70 percent of those payments belonged to them.

The Bienenstocks sold plaintiffs' deposition transcripts without telling them, secretly charged higher rates for plaintiffs' services, and charged for myriad additional services, all the while keeping every penny of the additional income for themselves.

"Like most such schemes, this one also involved a cover up: the Bienenstocks employed elaborate internal processes and office protocols to conceal their unethical and unlawful business practices. The Bienenstocks bullied their employees with temper tantrums and threats of termination should they reveal the truth to plaintiffs, and they consistently denied their dishonest practices when questions arose.

The Bienenstocks used plaintiffs' money to fund an outlandish lifestyle replete with luxury homes, exotic cars, and extravagant vacations for themselves and generous gifts for the attorneys and law firms who unwittingly facilitated the Bienenstocks' corrupt business.

"Although startling enough on its face, the Bienenstocks' outrageous behavior is particularly execrable in light of the integral role licensed court reporters and court reporting firms play in our legal system. They provide the certified transcripts of sworn deposition testimony relied upon in nearly every case and nearly every court here and across the country, their activities are strictly regulated by Michigan statute and the Michigan Court Rules, and they are regulated by the State Court Administrative Office, the administrative agency of the Michigan Supreme Court.

The Bienenstocks' longstanding scheme to pocket the plaintiffs' income thus undermines the integrity of the vital process by which certified deposition transcripts are produced for the use of this and other courts."

The reporters add: "The customers generally ordered transcripts directly from the court reporters on the same day as the depositions. When this occurred, plaintiffs were aware that a transcript had been ordered and they expected to receive and, on information and belief, usually did receive what they believed was their agreed-upon share of the payment received by Bienenstock & Associates."

But when customers ordered transcripts after the day of the deposition, "defendants took calculated steps to conceal the existence of back orders and payments received for back orders from plaintiffs so that they could keep all of the customers' payments for themselves, including plaintiffs' share of those payments," the complaint states.

The Bienenstocks also charged customers a higher hourly rate than it paid plaintiffs and sometimes negotiated higher per page rates than the rates it disclosed to the reporters, according to the complaint.

The court reporters seek damages for conversion, breach of contract, fraud, fraudulent concealment, and unjust enrichment. They also ask the court for a declaratory judgment as to which claims are subject to arbitration agreements, because the Bienenstocks did not provide the reporters with a copy of their executed employment contracts.

They are represented by Kevin O'Shea of Miller Law Group of Rochester, Michigan.

"Is it possible that this is not an isolated case? NCRA, should follow this story. Its ethics committee especially.

Ask yourself. If NCRA is going to try to police its members on ethics why wouldn't it - if there is indeed one or more verdicts against the Bienenstocks, then should not there be some form of recrimination exacted on them for theft and running a continuing fraudulent scheme to deprive their lifeblood, their subcontractors, what is clearly theirs?

If NCRA has no bite, it has no gumption, it has no ability like the ABA or other national associations to suspend one's membership, then ask yourself as a working stiff, what good is the NCRA anyway? The Bienenstocks frankly could care less what NCRA does - if anything.

Where they will most assuredly hurt will be in lost business, from a booming business to a shell of a business. No doubt one or two heads rolled but not the Bienenstocks. Therefore what promises they make to their reporters is still shrouded in continued deception.

The NCRA should at least publicly rebuke the Bienenstocks in the JCR for three months warning the unsuspected that working for this former illustrious reporting agency may spell trouble for their pocketbook.

Regardless, my gut feeling is the Giant is climbing down this Bienenstock but this time he makes it all the way down safely to the ground to exact the punishment befitting the crimes.

Tags: Bienenstock, Lawsuit

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It was will interesting to see what happens to this firm, if indeed they lose the case.    If this firm was not owned by a court reporter (as many of the big firms are not) then there could certainly be nothing done to punish the firm.

Martha, "the bigger they are, the harder they fall." If there is a victory for the plaintiffs, their Harvard trained lawyer, Kevin O'Shea, and his law firm know exactly every move to make in anticipation of most moves the scoundrels make, and most certainly how to attach a huge verdict - as the Complaint asks for treble damages - to their individual and corporate assets. If the Bienenstocks persist in their folly, they walk a perilous road to oblivion. In these types of cases, a jury and or a judge can recommend that the findings of the jury be reviewed by the state attorney general's office and indeed the US Department of Justice for criminal prosecution since they have done business almost in every state of the Union.

I don't think this is an isolated incident; I think there are lots of court reporting agencies that keep the money from roughs that are requested after the fact and also copy orders.   It's difficult to police that type of activity.   I wonder how they got caught.  Did a disgruntled employee spill the beans?

Keep us posted on what happens.  Very interesting. 

Kelli, actually I noticed after I posted this, that you yourself posted earlier the language from the Courthouse News Service that tracked or paraphrased the actual complaint. An email was sent to me by one of the plaintiffs because this same language I decided to post on Linkedin in the five or so court reporter blogs. Yes, somebody witness on the Bienenstocks office computer paid invoices for copies that one or more of the 26 original plaintiffs saw of their past work. That's how this case started. I predict it will indeed go national, maybe tracked internationally as all couch potatoes like o see a gory movie play to its final outcome where the monster is sliced and diced by the local peasants. Stay tuned.

Mary Ann P. sent me the post on this subject and I posted it here.  I didn't read much of it.   It's pretty sad that this sort of thing has to happen.  I don't mean the lawsuit either.

As you point out, I am sure this is happening all over. If they just said, "Look, you get paid for original and up to two copes. The rest belongs to us. Take it or leave it. You get $3.50 per page for original and two copies. Take it or leave it. If we then charge lawyers $7.00 per page on the original, this is none of your business. If we charge every copy order $3.50 per page, that too is none of your business. But hat is not the practice in our industry. Whatever the gross dales are, it is a percentage split and we honor our loyal workers by letting them know back orders came in. These brave reporters may well lead the nation in purging from our ranks unsavory operators who cleverly hide our just rewards converting our money to pay t rent, the mortgages, food on the table, our kids education. Most certainly if we help them get the word out w can help ourselves to have other like regional and national agencies cease and desist forthwith before a calamity of indescribable pain and suffering that we may well witness exacted on the Bienenstocks for their greed.

What I anticipate is the pay structure will change.  There are already many agencies that do not pay on a split.  I imagine that practice will spread like wildfire.  When it comes to orders after the fact, that's a different matter altogether.  Maybe agencies will simply have the policy of orders received after the deposition is submitted by the reporter will not be paid to reporter, something like that.  More than likely, it'd fly.  Those who work with agencies inclined to do that kind of thing might have to start reading the vast amounts of unnecessary paperwork very carefully.

Amanda, our choices will be clear. Take it or leave it. It will be likes the airlines. One raises rates, the others sit back and watch, then do the same, but take away the free lunches and dinners as well. But our strength as singular one person business operator will be, "I do not want your work. I will work with other agencies who maintain the status quo on splits."

Then the agency gradually cannot cover jobs and loses contracts because we have blackballed them like lepers. Two can play this game.

One of the largest agencies is a contractor that is a jury consulting firm that is hired to help win one of the parties their case, yet they seem to have no trouble getting warm bodies to report (even at low rates, in my opinion).  I don't think reporters are going to bristle too much when it comes to flat rates/no splits, just so long as it's in the ballpark of what they're used to.  That ballpark will then be stagnant for years -- wait, this is sounding familiar.  Stagnant.  Years.   Hmmm.....

Don't get me wrong, T. S., I appreciate your concern and you fighting the good fight.  I do, too.  Nothing would make me happier than for reporters to take control--and this lawsuit is very encouraging.  I hope these reporters prevail.  And on a slightly different note, but just as concerning, if not more: I hope the Gang of Five does not.

Oh, yes, there are court reporters who are suffering because of our economic malaise, aggravated by the locale where they live, not much work, most of us will do anything to put food on the table, so therefore willing to work for less.

But those of us who are really good at what we do, real time, daily copy, extra PC loaners, just like the top lawyers in the country, top engineers, any one of us who has a proven track record, we will always demand and get the best fees participating in the higher profile cases where our skills are appreciated.

But we also have to live in an area of the country where there is that ilk of litigation. Location, location, location. Stuck in the boonies, you may likely starve.

So for us all, we need to follow this Michigan case because there is too much at stake. Other bad apples in our industry will necessarily change their modus operandi even while this case inches forward.

T.S., I enjoy reading your posts.  They are intelligent and witty comments.

Sure would like to see more of us reporters stand together against greedy firm owners with shyster-like business practices!  Thank goodness they are not all like that!

I will be following this case with much interest.  I applaud the plaintiffs' courage.

 

We all are, Darlene. Their case will certainly go national and even international. These reporters will be invited to state association functions all over the USA to finally discuss in the open their case after a victory that we all will share in. I will follow this case and write about it as much as I can, not making blind reckless commentary, but reporting on facts to my readership in all the social media like LinkedIn and Facebook.

Hold on to your hats, and buckle in. This will be an amazing story unfolding. I dare say even lawyers and paralegals and judges will eventually be monitoring this national story because nobody likes thieves and pretenders to absolute integrity in business.

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