July 3, 2025

Changes to Texas Business Court Enhance Dispute Resolution

News Summary

Governor Abbott has announced amendments to the Texas Business Court, aimed at broadening its authority and streamlining complex legal proceedings. The amount-in-controversy threshold has been reduced from $10 million to $5 million, making it easier for mid-sized businesses to pursue disputes. Additionally, the court will now handle a wider range of issues, including intellectual property and contracts. These changes are set to make Texas a more attractive venue for commercial litigation, encouraging companies to update their legal strategies in response.

Texas has officially expanded the jurisdiction of its Business Court following amendments signed by Governor Abbott on June 21, 2025. The changes are intended to streamline complex commercial litigation and broaden the court’s authority over business disputes.

The most significant alteration introduced by the amendments is the reduction of the amount-in-controversy threshold for most cases from $10 million to $5 million. This means that more mid-size and high-value business disputes are now eligible for resolution under the Texas Business Court’s jurisdiction.

Under the new regulations, businesses can aggregate claims from all joined parties, including counterclaims and cross-claims. This development aims to simplify the process by allowing multiple business disputes to meet the $5 million minimum requirement more easily. Additionally, several related transactions can be combined to satisfy this threshold, further broadening the court’s case intake.

Notably, the expanded jurisdiction of the Texas Business Court now includes a variety of disputes encompassing intellectual property cases, such as patents and trade secrets, alongside commercial contracts (excluding insurance contracts). The court can also address violations of the Texas Finance Code or the Business & Commerce Code committed by organizations or their officers.

Another significant feature of the amendments is the court’s ability to enforce arbitration agreements, appoint arbitrators, and review arbitral awards, provided that the underlying dispute lies within its specified jurisdiction.

The primary focus of these legislative changes is to attract more filings in the Texas Business Court and discourage the transfer of older cases into the new court system. However, there is a limited exception allowing for the transfer of cases filed before September 1, 2024, if all parties involved and the court consent.

These adjustments are aimed at enhancing Texas’s reputation as a reliable venue for substantial commercial litigation while providing greater predictability for businesses and investors in dispute resolutions. With the operational goal of expediting complex business disputes, the Texas Business Court employs specialized judges with significant experience in business law.

Since its opening on September 1, 2024, the Texas Business Court has issued numerous opinions that have had a considerable impact on the business landscape in Texas. Recent rulings have illustrated that well-pleaded allegations of factors such as alter ego and conspiracy can establish jurisdiction under Section 25A.004(b)(2) of the Government Code. Furthermore, cases related to corporate governance and manipulation claims have expanded the court’s authority regarding internal affairs.

The evolving rulings from the Texas Business Court since its inception are shaping the treatment of fiduciary duties and establishing critical case law essential to its functioning. As a result, legal experts encourage companies to reevaluate their litigation strategies and update contracts to adapt to the latest developments.

The amendments will take effect on September 1, 2025, prompting companies operating in Texas to consider the Texas Business Court as their primary venue for resolving significant business disputes. Legal professionals and companies are adapting quickly to ensure compliance with new rules and make the most of the expanded jurisdiction afforded by the legislation.

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Author: STAFF HERE GEORGETOWN

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