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 enacted significant changes to the jurisdiction and authority of the Texas Business Court with the passage of House Bill 40 (HB 40), signed by Governor Abbott on June 20, 2025. The newly established amendments will come into force on September 1, 2025, and are designed to facilitate corporate disputes and streamline complex legal proceedings.
One of the most notable adjustments made by the new law is the reduction of the amount-in-controversy threshold for most cases, which has been lowered from $10 million to $5 million. This change allows a broader range of business disputes to be heard in the Texas Business Court. Furthermore, the court now allows the aggregation of total claims, including both counterclaims and cross-claims, enhancing the scope of its jurisdiction.
The updated regulations enable parties involved in a series of related transactions to aggregate their claims to meet the new $5 million minimum threshold. This is expected to encourage more businesses to utilize the Texas Business Court for their legal disputes, particularly those that involve financial stakes that can now be combined to reach the required amount.
In addition, the jurisdiction of the Texas Business Court has been expanded to encompass a variety of intellectual property disputes, including those related to patents, trade secrets, software, data security, and biotechnology. This broadened scope marks a significant shift, further positioning Texas as a competitive forum for resolving high-stakes corporate litigation.
Moreover, the court is now authorized to oversee business, commercial, and investment contracts or transactions—excluding insurance contracts—if the involved parties consent to the court’s jurisdiction. This flexibility increases the court’s appeal for corporate entities seeking a reliable legal venue in Texas.
The amendments also grant the Texas Business Court the authority to enforce arbitration agreements, appoint arbitrators, and review arbitral awards concerning relevant cases. Such capabilities are intended to strengthen the court’s role in resolving disputes efficiently and effectively, making it a streamlined option for businesses engaged in arbitration.
To facilitate and expedite court processes, the Texas Supreme Court is instructed to establish rules governing jurisdictional determinations within the Texas Business Court. These measures aim to promote efficiency and consistency when adjudicating high-value business disputes.
The reforms introduced through HB 40 are anticipated to lead to an increase in litigation filings within the Texas Business Court. Legal and business stakeholders who supported these reforms expect that the court will become a preferred venue for mid-size and high-value cases alike. This aligns with Texas’s goal of becoming a premier state for business incorporation, drawing parallels to the well-regarded Delaware Court of Chancery.
The enhancements brought about by HB 40 reflect a commitment to consolidating the Texas Business Court’s status as a leading forum for commercial litigation. Through these clarifying reforms, Texas aims to create a conducive environment for businesses, bolstering its reputation as a serious contender in the corporate legal landscape.
As the business environment continues to evolve, these changes position the Texas Business Court as a proactive solution for corporations facing complex legal challenges, establishing clearer pathways for dispute resolution and instilling confidence in the judicial process.
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 GEORGETOWN
About the HERE Georgetown Staff Writers The HERE Georgetown Staff Writers are a dedicated team of local journalists and contributors focused on delivering accurate, timely news to the Georgetown, SC community. As part of the HEREcity.com Network—which powers over 100 U.S. city sites including HEREcolumbia.com—we cover everything from waterfront development and small business news to dining and local culture. Local Expertise Our team includes lifelong Georgetown residents and South Carolina natives with deep knowledge of the region’s history, economy, and coastal identity. We’ve reported on topics like Front Street revitalization, maritime heritage, and local education initiatives. Trusted Journalism With decades of combined experience, we prioritize fact-based reporting, drawing from city records, chamber data, and community voices. Every article is a team effort, researched and verified to meet high editorial standards.