News Summary
Texas lawmakers are making significant changes to the state’s business courts after only a short period since their establishment. A new compromise bill, which has received bipartisan support, will lower the threshold for cases and broaden the court’s jurisdiction. While expansion plans were stalled, this move is seen as beneficial for easing access to business-related legal disputes. The evolution of Texas’s business court system is being closely monitored, with additional legislative efforts anticipated in the near future.
Texas Lawmakers Take Steps on Business Courts: A Change in Direction
In Austin, Texas, state lawmakers have made significant decisions affecting the operation and scope of the state’s business courts. Just months after their establishment, changes are taking shape, impacting how businesses can navigate legal disputes in the Lone Star State.
No Expansion for Now
In a surprising turn of events, lawmakers have chosen not to expand the business courts to additional cities or to increase the number of judges in high-demand venues. This decision came during the final days of the legislative session following intense negotiations. While some stakeholders had anticipated enhancements to bolster the business court system, Texas Senate leaders opted for an alternative trajectory, modifying a House proposal that aimed for broader expansions.
A Compromise Emerges
Ultimately, a compromise bill has been prepared for Governor Greg Abbott’s approval. A key feature of this bill is the reduction of the amount-in-controversy threshold for cases from $10 million to $5 million. This adjustment is expected to facilitate access for more companies and individuals to present their cases in business courts, which many view as a favorable development.
What’s in House Bill 40?
On May 13, the Texas House of Representatives passed House Bill 40 (HB 40) with a vote of 99-40. This significant legislation seeks to broaden the range of cases that are eligible for the business court’s jurisdiction. Additionally, it mandates the Texas Supreme Court to formulate rules regarding this expanded jurisdiction. With bipartisan backing in the House, these changes may streamline the resolution of business-related disputes in Texas.
Looking Ahead
If endorsed by the governor, the provisions detailed in HB 40 would take effect on September 1, 2025. However, early implementation could be possible if both chambers of the legislature vote with a two-thirds majority, marking an important point of interest for observers as legislative dynamics shift.
Business Courts in Action
Since their inception, Texas business courts have witnessed a notable volume of activity. Within the first 100 days of operation, 53 new cases were filed, with Houston’s Eleventh Division being the most active. So far, only eleven cases have concluded; however, the initial stages show that legal processes are beginning to function effectively. Approximately one-third of the cases involve removals from district courts that were pending before September 1, 2024.
Judges Weigh In
Interesting developments have emerged from the judiciary as five out of ten business court judges have determined that certain cases filed prior to September 1, 2024, are unsuitable for removal to the business court. This ruling has resulted in at least eight cases being moved back to their original district courts, prompting two appeals currently in process with the Fifteenth Court of Appeals.
Setting the Stage
At this early stage, only a few rulings have been made by the business court. New rules governing aspects such as motion practice and mandatory corporate disclosures have been adopted. Additionally, to maintain balance in caseloads, some cases from the Houston division are being transferred to the San Antonio division.
Looking Forward
As legislators plan for future sessions, efforts are underway to further discuss reduced amount-in-controversy thresholds for specific disputes. There’s also speculation about extending judges’ terms to six years. Recent judicial rulings have provided clarity on the jurisdictional scope of business courts, potentially affecting future claims for injunctive relief and declaratory judgment as these new law changes come into play.
The progression of Texas’s business court system remains a crucial topic. With ongoing legislative support and evolving judicial practices, the landscape for business litigation in Texas may undergo considerable changes in the foreseeable future.
Deeper Dive: News & Info About This Topic
- Bloomberg Law: Texas Business Courts Adding Cases, Not Judges in Approved Bill
- Wikipedia: Texas Business Court
- Vinson & Elkins: Potential Changes to the Texas Business Courts’ Jurisdiction and Operation
- Google Search: Texas Business Courts
- Hunton: The Texas Business Court – The First 100 Days
- Encyclopedia Britannica: Texas Business Courts
- White & Case: Texas Business Courts – What You Need to Know
- Google News: Texas Business Court Changes
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.
