Nearly one year in, the Texas Business Court has been an unqualified success. Despite early skepticism, the Court, which started accepting cases on September 1, 2024, has lived up to its goal of moving business litigation in a speedy, efficient manner.
More than 150 cases have been filed in the Texas Business Court, and the Court has issued more than 20 opinions in the first half of 2025. Recent action by state lawmakers will significantly strengthen the court and open up Texas as a jurisdiction of choice for high-stakes business litigation. The Court provides a seemingly attractive forum for qualifying cases to the congested dockets of state district courts along with a developing expertise in complex, high-stakes business litigation matters. The Court provides a great deal of important information on its website.
State Legislature Offers Strong Support for Texas Business Court
The Texas Legislature recognizes that the Court is working as intended. Recently, Texas lawmakers approved a bill, which the Governor signed into law, expanding support for the Court, and broadening its jurisdiction. This legislation also relaxes some of the Court’s initial high barriers to entry, including steep monetary thresholds and jurisdictional restrictions. These changes should increase the Texas Business Court’s volume of cases.
House Bill 40 (Relating to the business court) takes effect Sept. 1, 2025, and expands the Court’s jurisdiction to cover qualified transactions involving at least $5 million in consideration and at least the same amount in controversy. This significantly changes the amount in controversy requirement from the $10 million currently required and clarifies that a “qualified transaction” may be one transaction or a series of related transactions.
Significantly, HB 40 expands the Court’s jurisdiction to allow it to oversee intellectual property (IP) cases involving trade secrets, licensing, and IP-related ownership, use, lease, installation, and performance disputes. These IP-related qualifying cases, however, will not include IP subject matter where federal courts still have exclusive jurisdiction (e.g., patent infringement, patent validity, copyright infringement).
Where appropriate, cases now can be transferred to the Texas Business Court, and the Court can enforce arbitration agreements and review arbitration awards for cases that meet the Court’s criteria. HB 40, however, prohibits filing of state or federal consumer related claims in the Court.
But perhaps most important, HB 40, which passed with overwhelming support, illustrates the state’s commitment to the Texas Business Court.
What Companies Need to Know About the Texas Business Court
With the establishment of the Texas Business Court, and these recent legislative steps, the Lone Star State will become an even bigger and busier venue for large-scale corporate litigation.
In-house counsel must consider updating contracts where needed, become familiar with the procedures of the Texas Business Court, be prepared to defend their company’s interests in the Court, and watch for case law arising from the Court which may impact its industry. In particular, companies also should be ready to litigate qualifying business-related IP decisions (e.g., trade secrets and IP-focused contracts) in the Court since those now fall under its jurisdiction.
[View source.]
