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.
Texas has made significant strides in enhancing its business litigation landscape with the recent passage of House Bill 40 (HB 40). Signed by Governor Abbott on June 20, 2025, the bill amends the structure and jurisdiction of the Texas Business Court, streamlining processes for corporate disputes. These amendments will take effect on September 1, 2025, making it easier for businesses to resolve their legal issues efficiently.
One of the key changes introduced by HB 40 is the reduction of the amount-in-controversy threshold from $10 million to $5 million for most cases. This adjustment lowers the financial barrier for businesses seeking to engage with the Texas Business Court, allowing a wider array of disputes to be handled within this jurisdiction. Additionally, the bill permits parties to aggregate the total amount of claims, including counterclaims and cross-claims, further expanding the court’s reach over business disputes.
Another significant enhancement is the expanded jurisdiction of the Texas Business Court to include intellectual property disputes. From patent infringement to trade secret violations, the court can now adjudicate these complex cases, covering vital sectors such as software, data security, and biotechnology. This change is expected to position Texas as a competitive venue for companies involved in high-stakes intellectual property litigation.
Furthermore, the Texas Business Court now has the authority to oversee various business, commercial, and investment contracts—excluding insurance contracts—if the parties involved agree to this jurisdiction. This gives businesses greater flexibility in determining where their disputes are resolved. The court is also equipped to enforce arbitration agreements, appoint arbitrators, and review arbitral awards, underscoring its commitment to providing comprehensive conflict resolution services.
The amendments to the Texas Business Court are designed with the intention of streamlining complex proceedings. By giving judges additional tools necessary for handling high-value commercial disputes, the reforms are anticipated to expedite the adjudication process. In that regard, the Texas Supreme Court is mandated to establish rules governing jurisdictional determinations, which will further enhance efficiency in the court’s operations.
Stakeholders from both the legal and business communities have voiced support for these reforms, emphasizing the need to clarify procedures and enhance the practical utility of the Texas Business Court. By reforming the court’s jurisdiction and operational framework, Texas aims to attract more businesses and legal cases, particularly those that are mid-sized or high-value.
The changes brought about by HB 40 signify Texas’s ambition to mirror the successes of Delaware’s Court of Chancery, which is renowned as a leading forum for corporate litigation. Lawmakers and industry advocates see this as a critical step in solidifying Texas’s status as a premier state for business incorporation and dispute resolution.
As a result of these amendments, analysts expect an increase in litigation filings in the Texas Business Court, creating a reliable venue for businesses to resolve their disputes quickly and effectively. Overall, House Bill 40 represents a strategic move aimed at fostering a more favorable business climate while enhancing the legal framework for corporate entities operating within Texas.
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 COLLEGE WRITER
The COLLEGE STATION STAFF WRITER represents the experienced team at HERECollegeStation.com, your go-to source for actionable local news and information in College Station, Brazos 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 the Brazos Valley Fair & Rodeo, Chilifest, and Aggie Muster. Our coverage extends to key organizations like the Bryan-College Station Chamber of Commerce and United Way of the Brazos Valley, plus leading businesses in education, biotechnology, and retail that power the local economy such as Texas A&M University, Fujifilm Diosynth Biotechnologies, and H-E-B. As part of the broader HERE network, including HEREAustinTX.com, HEREDallas.com, HEREHouston.com, and HERESanAntonio.com, we provide comprehensive, credible insights into Texas's dynamic landscape.
