Changes to Texas Business Court with New Legislation

News Summary

Texas is set to transform its business litigation landscape with the passage of House Bill 40. This new law reduces the amount-in-controversy threshold for the Texas Business Court, allowing more complex cases and intellectual property claims to be addressed. Key reforms aim to streamline processes and improve court functionality, positioning Texas as a compelling alternative for corporate governance. The bipartisan support for this legislation underscores a commitment to fostering a favorable business environment, drawing attention to the impending changes as businesses prepare for a new era in the Texas legal landscape.

Exciting Changes Coming to Texas Business Court with New Legislation!

In a buzzing atmosphere of anticipation, the Lone Star State is set to enhance its legal landscape for businesses with the passage of House Bill 40 (HB 40). The bill, which Governor Greg Abbott signed into law on June 20, 2025, will officially take effect on September 1, 2025. So, what does this mean for Texas’s corporate scene? Buckle up, because it’s about to get interesting!

Expanding Jurisdiction for Complex Cases

First up, let’s highlight what’s changed. HB 40 is all about making the Texas Business Court a powerhouse for handling complex business litigation. One of the most notable amendments is the significant drop in the amount-in-controversy from $10 million down to $5 million. This shift means that more businesses can now bring their disputes to the Business Court, even when multiple parties are involved.

But that’s not all! The law now allows businesses to stack claims from different parties together to reach this new threshold. This means that collaborating businesses who might have smaller individual claims can now combine them and seek resolution under the Business Court’s jurisdiction.

New Areas of Focus

Another interesting point to note is the explicit inclusion of intellectual property (IP) and trade secrets claims in the Business Court’s jurisdiction. This substantial broadening of scope acknowledges the importance of protecting intellectual property in today’s fast-paced digital age. So if you are an innovator with a breakthrough idea, this new law is particularly good news for you!

Streamlined Processes Ahead

HB 40 also brings about key clarifications regarding the Business Court’s authority. The court will now have the power to enforce arbitration agreements, decide on arbitrators, and review the outcomes of arbitration awards. What does this mean for corporate litigants? More efficient proceedings and a clearer understanding of how disputes will be resolved without unnecessary hang-ups.

A Commitment to Efficiency

In a bid to make things run smoother, the legislation introduces administrative reforms aimed at improving the court’s functionality. Among these reforms is a directive for the Texas Supreme Court to adopt rules that speed up jurisdictional determinations. This is a big deal for businesses eager to see their cases resolved without prolonged delays.

Positioning Texas as the Go-To State

As the legal world shifts, the timing of these reforms is critical. With increasing scrutiny on Delaware’s esteemed Court of Chancery, Texas is stepping up to present itself as a compelling alternative for corporate governance and litigation. Companies looking for favorable litigation environments are likely to take notice!

Paving the Way for the Future

Moreover, other amendments clarify that the Business Court shares concurrent jurisdiction with district courts. This provision aims to provide predictability in legal proceedings, helping companies better navigate the sometimes turbulent waters of business litigation.

All these changes underscore the Texas Legislature’s dedication to creating a more favorable environment for business litigation. The bipartisan support for HB 40 indicates a strong political resolve behind these reforms, suggesting that lawmakers of various stripes agree on the importance of a robust business community.

In conclusion, as the September 1 effective date approaches, all eyes will be on Texas. Businesses will certainly be watching to see how these changes unfold and what they might mean for their futures. With new opportunities emerging in the Texas Business Court, it’s an exhilarating time to be a part of the Texas business landscape!

Deeper Dive: News & Info About This Topic

• Pillsbury Law: Bipartisan Passage of House Bill to Expand Texas Business Court Jurisdiction
• Wikipedia: Texas Business Court
• Vinson & Elkins: Texas Business Courts Quarterly Update Q1 and Q2 2025
• Google Search: Texas Business Court
• Dykema: Can Texas Business Courts Handle More Cases?
• Encyclopedia Britannica: Legal System
• Foley & Lardner: Texas Legislature Strengthens Business Court
• Norton Rose Fulbright: Recent Removal Rulings Clarify Texas Business Courts’ Jurisdiction