Texas poised to create specialized business courts

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Move over, Delaware: Texas poised to create specialized business courts

House Bill 19, approved by the state Legislature, would establish specialized business courts in the state's major metropolitan areas, including Houston.Big businesses in Texas may soon have courts to call their own, thanks to a measure passed by the Texas Legislature.in the state's major metropolitan areas, including Houston, serving a statewide judicial district and overseen by appointed judges.

"All corporate lawyers will tell you that Delaware is the preeminent state to do business law," Villalba said."As a Texan, I’m thinking to myself, well, why? Delaware is this tiny little state." An overstatement, that. But proponents of the law agree that having business courts in Texas would make the state a more attractive destination for business. As it stands, many companies incorporate in Delaware, or reference Delaware in their governing documents, in order to have access to the expertise of that state's long-established business courts.

While the measure received some Democratic support in the Texas legislature, it also received pushback from legislators who saw it as a power grab on the part of Republican state leaders. In Harris County, as it stands, most judges are Democrats—and all of them are subject to being booted by voters in regular partisan elections. The Texas Constitution, adopted in 1876 and amended countless times since, stipulates that judges should be elected.

 

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