July 8, 2025

Texas Business Court Expands Jurisdiction

News Summary

The Texas Business Court is set to expand its jurisdiction to include intellectual property matters, following the passage of House Bill 40. This change allows the court to handle a variety of IP disputes that were previously assigned to other courts, marking a significant shift in Texas’s legal landscape. The new provisions will take effect on September 1, providing businesses with a more efficient venue to resolve conflicts related to ownership, licensing, and trade secrets. Texas aims to enhance its role as a leader in business litigation, ensuring accessible solutions for companies involved in intellectual property cases.

Texas has taken significant steps to strengthen its position as a key player in business and intellectual property litigation with the recent passage of House Bill 40 (HB 40). The Texas Legislature, during its biennial session in 2025, amended the Texas Business Court, allowing it to now handle a broader range of intellectual property (IP) matters.

HB 40 passed with the objective of creating a more efficient pathway for litigating specific IP disputes within the state. The amendment introduces new provisions that enable the Texas Business Court to adjudicate cases relating to the ownership, use, licensing, lease, installation, and performance of intellectual property. This aims to streamline the legal process for businesses involved in IP-related conflicts.

The Texas Business Court, which was originally established in 2023, primarily focused on complex high-value business and commercial litigation before the passage of HB 40. Now, with the new bill, the court can concurrently handle disputes concerning IP ownership, licensing, and issues like trade secret misappropriation.

While parties still have the option of bringing their cases to other courts, the Texas Business Court is likely to become a preferred venue for such matters. However, it’s important to note that patent infringement lawsuits will remain under the jurisdiction of federal courts, which continue to oversee issues related to patent validity and infringement.

In addition to IP matters, the expanded jurisdiction will also encompass various contract disputes linked to software, data security, and biotechnology. This versatility in handling diverse issues demonstrates Texas’s commitment to fostering a business-friendly legal environment.

The legislative process culminated with Governor Greg Abbott signing HB 40 into law on June 20, 2025. The provisions outlined in the bill are set to take effect on September 1, 2025. This timeline allows for a gradual transition into the new legal framework, ensuring that affected parties can adjust accordingly.

The expansion of the Texas Business Court’s jurisdiction to include intellectual property matters reflects the ongoing evolution in Texas’s approach toward handling these types of disputes. By making Texas a more attractive forum for business litigation, legislators aim to enhance the state’s appeal to companies and innovators in various sectors, particularly those focused on technology, creative arts, and life sciences.

The move is seen as part of a larger trend across the United States, where states are actively restructuring their legal systems to better accommodate the rapidly growing complexities of intellectual property law. As businesses continue to navigate an increasingly digital landscape, the demand for specialized venues that can provide expert adjudication is likely to rise.

In summary, with the passage of HB 40, Texas is positioning itself to become a leading jurisdiction for business and intellectual property litigation. This legislative change not only reflects the evolving nature of the legal landscape but also highlights Texas’s proactive stance in addressing the needs of modern businesses.

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Author: STAFF HERE GEORGETOWN

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