Texas Business Courts: A New Era for Commercial Litigation

On September 1, 2024, the newly established Texas Business Court officially began accepting cases. This specialized court is designed to handle complex commercial litigation, providing a venue where judges with expertise in intricate commercial issues oversee dedicated dockets. For businesses in Texas, this represents a significant shift, offering an alternative to traditional state district courts.

The Texas Business Court is part of a growing trend across the U.S., where nearly half of the states now offer specialized courts for commercial and civil business cases. This court aims to streamline and enhance the handling of high-stakes commercial disputes, ensuring cases are managed efficiently and with expertise.

The court operates across eleven divisions located in key counties:

• Dallas (1st Division): Judges Andrea Bouressa and William Whitehill
• Travis (3rd Division): Judges Melissa Andrews and Patrick K. Sweeten
• Bexar (4th Division): Judges Marialyn Barnard and Stacy Sharp
• Tarrant (8th Division): Judges Jerry Bullard and Brian Stagner
• Harris (11th Division): Judges Sofia Adrogue and Grant Dorman

The Texas Business Court has limited concurrent jurisdiction with state district courts. Cases can enter the court through:

1. Direct Filing in the business court.
2. Removal from state district court by filing a notice of removal.
3. A sua sponte order issued by the district court.

If a case is removed to the Business Court, the opposing party has 30 days to file a motion to remand it back to the state district court. Similarly, parties wishing to transfer their case to the Business Court must act within 30 days of discovering their eligibility.

The Texas Business Court incorporates several notable procedural differences from state district courts:

1. Mandatory Scheduling Orders
   • Parties must file a scheduling order within 30 days of the first defendant’s appearance or the notice of removal.
2. Discovery Dispute Process
   • Before filing a discovery motion, parties must attempt to resolve disputes through a diligent, good-faith effort. If unresolved, a letter summarizing the dispute must be submitted, including details of prior attempts to reach an agreement.
3. Strict Word Limits
   • Filing documents are subject to specific word limits:
     • Discovery motions: 3,000 words
     • Discovery replies: 1,250 words
     • All other motions: 7,500 words
     • Replies to other motions: 3,000 words

    

Exceeding these limits requires express court approval.

Litigating in the Texas Business Court comes with higher upfront costs than state district courts:

• Filing Fee: $2,500 (compared to $350 in district courts).
• Motion Fees: $50 per motion (district courts typically charge no fees for motions).

While these costs may deter frivolous filings, they are an important factor to consider when deciding whether to pursue litigation in this court.

As a newly established institution, the Texas Business Court brings new opportunities and challenges for commercial litigation in Texas. The next few years will be pivotal in determining how the court evolves and impacts the legal landscape.

For businesses, understanding the nuances of this specialized court is essential to leveraging its potential benefits while navigating its unique procedures and costs.

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