4 minute read | May.19.2023
Texas has joined more than two dozen other U.S. states in creating a court system to handle certain business disputes. Companies with cases in the new Texas Business Court will appear before appointed judges with expertise in corporate and complex litigation matters. Proponents envision more predictable and efficient resolution of business litigation.
What is the Texas Business Court?
It’s a new set of trial-level courts meant to resolve corporate and complex disputes in Texas, the world’s 9th largest economy.
Why is Texas creating a court system for certain business cases?
Proponents say the system will:
What practical effect could the Texas Business Court have on my business and litigation?
The system creates the prospect of more predictability and efficiency by having cases heard by judges with a background and focus on business law rather than judges with a broader and more diverse caseload.
What should a company with operations in Texas do?
The state will share more guidance before the court system begins hearing cases in September 2024. In the meantime, companies should consider:
What cases will the new court system hear?
The new courts will hear cases involving:
What cases may not be brought before the new court system?
Judges in the Texas Business Courts will not hear cases that:
Who will choose the judges – and what are the minimum qualifications?
The Texas governor will appoint judges to two-year terms with the advice and consent of the Texas Senate. The governor may reappoint judges at the end of a term.
Judges in the Texas Business Court must:
When – and where – will the Texas Business Court start hearing cases?
The court is scheduled to hear cases after September 1, 2024. The plan is to set up the first courts in and around Austin, Dallas, Fort Worth, Houston and San Antonio. By mid-2026, the goal is for the new courts to open in other parts of the state.
Will judges issue written opinions?
Yes. The idea is that, over time, the written decisions will create a body of precedent that companies can use to navigate Texas business practice and litigation. By contrast, Texas district court orders are rarely published.
What about trials?
Trials in the Texas Business Court will take place in the county where the case could have been brought, where the parties agreed to litigate the case or where the parties and the court agree to try the case. Trials may be to the bench or before a jury.
Where will the new court system hold ordinary hearings?
Most hearings will be remote. The court can’t require physical attendance at non-trial proceedings unless both parties agree.
Will the Texas Business Court face a court challenge?
Probably. The Texas Constitution requires “district” court judges to be elected, rather than appointed. Some have also argued that allowing the state governor to appoint judges creates checks-and-balances concerns among the three Texas branches of government.
[*] The amount in controversy excludes attorney’s fees, interest, court costs, statutory damages, penalties, and punitive damages.