News Summary
The Texas Legislature has made significant adjustments to the Texas Business Court, lowering the threshold for cases from $10 million to $5 million. This change, part of House Bill 40, aims to enhance access for mid-size businesses and streamline complex proceedings. Additionally, the court will have expanded jurisdiction over various disputes, including intellectual property, and will strengthen enforcement of arbitration agreements. These reforms are set to position Texas as a leading venue for commercial litigation, benefiting business owners and stakeholders alike.
Big Changes Are Coming to the Texas Business Court!
Texas is set to undergo significant reforms in its business dispute resolution process. The Texas Legislature has passed House Bill 40 (HB 40), which was signed into law by Governor Abbott on June 20, 2025. These changes will take effect on September 1, 2025, and are poised to make the Texas Business Court more accessible and efficient for businesses across the state.
What’s the Big Deal?
Historically, businesses needed to have a minimum claim of $10 million to bring a case to the Texas Business Court. However, this threshold will now be reduced to $5 million, making it easier for mid-size companies and stakeholders to seek resolution for business disputes. This adjustment aims to decrease barriers that previously hindered smaller entities from accessing judicial remedies.
Bringing it All Together
The changes will also allow for the bundling of several related transactions to reach the new $5 million minimum threshold. This means that businesses involved in multiple transactions can consolidate their claims into a single case, simplifying the litigation process and making it more manageable for organizations with complicated dealings.
Expanded Jurisdiction
The jurisdiction of the Texas Business Court is not only expanding in terms of accessibility but also in the types of disputes it will handle. The court will now oversee cases involving intellectual property, including patents, trade secrets, software disputes, and data security issues. This expansion recognizes the growing importance of technology and innovation in the business landscape, providing a specialized forum for resolution of these critical matters.
Additionally, companies entering commercial or investment contracts can now choose to use the Texas Business Court for dispute resolution, which is beneficial for navigating the complexities often inherent in such agreements.
Empowering Arbitration
House Bill 40 further enhances the court’s capabilities concerning arbitration agreements. The law grants the court the authority to enforce arbitration agreements, appoint arbitrators, and review arbitral awards. This feature is designed to help businesses resolve disputes without the need for protracted litigation, streamlining the resolution process while ensuring fairness.
Smoothing Out the Process
In terms of procedural efficiency, the Texas Supreme Court will now be responsible for establishing rules governing jurisdictional determinations. This is intended to expedite the court processes, allowing for quicker resolutions and reducing the waiting time for involved parties.
Aiming for Excellence
The motivation behind HB 40 is clear: to streamline complex proceedings and equip judges with the necessary tools for managing high-stakes commercial disputes. As Texas continues to bolster its reputation as a supportive environment for business operations, the anticipated reforms may lead to an increase in litigation filings within the Texas Business Court, establishing it as a prime venue for high-value cases.
What Does This Mean for You?
As these changes take effect, the Texas Business Court is poised to offer businesses a fair, efficient, and user-friendly environment for resolving disputes, paving the way for future economic growth and opportunity throughout the state.
Deeper Dive: News & Info About This Topic
- Jenkins & Watkins: Insights on Texas Business Courts Structure & Jurisdiction
- Dykema: Texas Business Courts Video Insights
- Vinson & Elkins: Texas Business Courts Quarterly Update
- Pillsbury: House Bill Expanding Texas Business Court Jurisdiction
- National Law Review: Strengthening Texas Business Courts
Author: STAFF HERE AUSTIN WRITER
The AUSTIN STAFF WRITER represents the experienced team at HEREAustinTX.com, your go-to source for actionable local news and information in Austin, Travis County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as SXSW, Austin City Limits Music Festival, Formula 1 United States Grand Prix, and the Austin Film Festival. Our coverage extends to key organizations like the Greater Austin Chamber of Commerce and Visit Austin, plus leading businesses in technology, automotive, and retail that power the local economy such as Dell Technologies, Tesla, and Apple. As part of the broader HERE network, including HERECollegeStation.com, HEREDallas.com, HEREHouston.com, and HERESanAntonio.com, we provide comprehensive, credible insights into Texas's dynamic landscape.
