Texas Business Court: What It Handles and When Small Businesses Can Use It

The Texas Business Court is a specialized court system designed to handle complex commercial disputes. It began operating on September 1, 2024, under Government Code chapter 25A. If you are starting a business or forming a partnership in Texas, you should understand what this court does, whether it applies to your business disputes, and when you might need to include a reference to it in your company agreements.

What Is the Texas Business Court?

The Texas Business Court is a specialized trial court system within the Texas district court structure. It focuses on commercial disputes that involve significant dollar amounts and complex legal issues. The court is designed to provide faster, more expert handling of business cases compared to traditional district courts, which handle a wide range of cases from family law to criminal matters.

The court operates in five divisions across major Texas cities. Each division covers a specific geographic area and state court region.

Which Texas Cities Have Business Courts?

The Texas Business Court currently operates in five divisions:

• Dallas Division (1st Administrative Judicial Region), covers Dallas and surrounding North Texas counties
• Austin Division (3rd Administrative Judicial Region), covers Austin and Central Texas counties
• San Antonio Division (4th Administrative Judicial Region), covers San Antonio and South Texas counties
• Fort Worth Division (8th Administrative Judicial Region), covers Fort Worth and surrounding North Texas counties
• Houston Division (11th Administrative Judicial Region), covers Houston and Southeast Texas counties

The Texas legislature has authorized additional divisions subject to funding. If your business operates in a part of Texas not currently served by a Business Court division, your disputes would remain in the regular district court system.

What Types of Cases Does the Business Court Handle?

The Texas Business Court handles disputes related to business and commercial matters. Common cases include:

• Business contract disputes
• Shareholder and ownership disputes in corporations and LLCs
• Business governance and management conflicts
• Partnership dissolution and disputes
• Intellectual property matters
• Trade secrets disputes
• Commercial loan and credit disputes
• Merger and acquisition disputes
• Arbitration-related matters
• Commercial disputes tied to the ownership or operation of a business
• Joint venture disputes

The court is equipped to handle cases that involve complex business issues and require judges with specialized knowledge of commercial law.

The Amount-in-Controversy Threshold: $5 Million and Up

Not every business dispute qualifies for the Texas Business Court. The amount of money in dispute is the key threshold. As of September 1, 2025, a case must generally involve $5 million or more in controversy to qualify for the Business Court. This threshold was lowered from $10 million when House Bill 40 (HB 40) took effect.

Before HB 40, only disputes involving $10 million or more were eligible for the Business Court. The new $5 million threshold brings more cases into the specialized court system, but it still excludes most small business disputes.

How the Amount-in-Controversy Is Calculated

The amount does not have to be a single transaction. When calculating whether a case meets the $5 million threshold, the court looks at the total value involved in the dispute. Several important rules apply:

• Series of Transactions: A series of related transactions can be combined to reach the $5 million threshold. If your business dispute involves multiple contracts or related deals, the total value of all related matters counts toward the amount.
• Aggregation of Claims: If there are multiple parties in the case, their claims are aggregated (added together) to determine if the threshold is met. For example, if one owner claims $3 million and another owner in the same dispute claims $2.5 million, the total of $5.5 million qualifies the case for the Business Court.
• Qualified Transactions: HB 40 also lowered the threshold for transactions related to the formation, governance, or operation of a business to $5 million. This includes mergers, acquisitions, and similar transactions.

What This Means for Small Businesses

Most small business disputes do not meet the $5 million threshold. If you start an LLC or corporation in Texas, your business is unlikely to use the Business Court for disputes, especially in the early years. A typical small business dispute over a partnership disagreement, a contract with a vendor, or a breach of service agreement will probably fall well below $5 million.

These disputes remain in the regular district court system in your county. District court judges handle your case alongside family law, criminal, and other civil matters. The Business Court is designed for larger, more complex disputes between substantial business entities.

However, as your business grows or if you are involved in a significant transaction, ownership dispute, or merger, the Business Court could become relevant.

New Areas Added by HB 40

Effective September 1, 2025, HB 40 expanded the types of disputes that can be brought to the Texas Business Court. New categories include:

• Intellectual Property Disputes: Cases involving patents, trademarks, copyrights, and other intellectual property that meet the dollar threshold can now be heard in the Business Court.
• Trade Secrets Disputes: Cases involving the misappropriation or protection of trade secrets are now within the Business Court's jurisdiction.
• Arbitration-Related Matters: Disputes related to arbitration agreements and arbitration proceedings can be brought to the Business Court.

If your Texas business involves intellectual property or trade secrets and a dispute reaches $5 million or more, you now have the option to pursue the case in the Business Court rather than regular district court.

How to Use the Business Court: Forum Selection Clauses

To use the Texas Business Court, a dispute typically must satisfy two conditions: it must fall within the court's subject-matter jurisdiction and generally meet the dollar threshold ($5 million or more). One route into the court is a contract in which the parties agreed that the Business Court has jurisdiction. Many businesses include a "forum selection clause" in their operating agreements, shareholder agreements, partnership agreements, or contracts. This clause specifies that any disputes arising from the agreement will be handled in the Texas Business Court.

For example, an LLC operating agreement might state: "Any litigation arising out of this Agreement shall be brought exclusively in the Texas Business Court." If both parties agree to this clause and a dispute later arises that meets the $5 million threshold, the case can be filed directly in the Business Court.

Without a forum selection clause, a party seeking Business Court resolution must still demonstrate that the case meets the amount and subject-matter requirements and show that the case falls within the Business Court's jurisdiction (a forum clause is one way, not the only way). Ask a Texas business attorney whether your dispute qualifies.

When Your Small Business Probably Will Not Use the Business Court

The vast majority of small business disputes in Texas are resolved in district court, not the Business Court. You are unlikely to use the Business Court if:

• Your dispute involves an amount less than $5 million
• You are dissolving a partnership where the business assets are worth less than $5 million
• You have a contract dispute with a vendor or customer valued under $5 million
• You are in a disagreement with a business partner but the value in dispute is under $5 million
• You have a straightforward breach of contract claim with limited damages
• Your business has not yet reached $5 million in value

For these disputes, your case will be filed in the district court in your county, where it will be handled by a judge who also oversees many other types of cases.

When a Business Court Might Be Relevant for Larger Disputes

The Business Court becomes a consideration if your business:

• Is involved in a merger or acquisition worth $5 million or more
• Has a governance or ownership dispute between partners or shareholders with $5 million or more at stake
• Is defending or pursuing a significant intellectual property or trade secrets claim exceeding $5 million
• Is party to a major commercial contract dispute
• Has a complex business litigation matter involving multiple related transactions totaling $5 million or more

In these scenarios, a business attorney might recommend including a Business Court forum selection clause in your agreements or pursuing Business Court jurisdiction if a dispute arises.

Why the Business Court Matters

The Texas Business Court exists to provide specialized handling for complex, high-value business disputes. Judges assigned to the Business Court develop expertise in commercial law and understand the nuances of business agreements, corporate governance, and commercial transactions. For large disputes, this specialized expertise can lead to faster resolution and more informed judicial decisions.

However, the $5 million threshold means the court serves primarily mid-sized to large businesses and transactions, not startup entrepreneurs or small business owners in their first few years of operation.

A Reminder: This Is Informational Content

This guide provides general information about the Texas Business Court and how it operates. It is not legal advice, and it does not constitute advice on whether the Business Court is appropriate for your specific situation. Business court jurisdiction, forum selection clauses, and dispute resolution strategies are matters of specialized law.

Before including a Business Court forum selection clause in your operating agreement, shareholder agreement, partnership agreement, or other business contract, consult with a qualified Texas business attorney. An attorney can advise you on whether such a clause makes sense for your business, explain the implications of selecting the Business Court as your forum, and ensure your agreement is properly drafted.

Similarly, if a business dispute arises, an attorney can advise you on your options and whether the Business Court is available and appropriate for your case.

Getting More Information

For official information about the Texas Business Court, you can contact the Texas court system or consult the Texas Judicial Branch website. The individual courts in Dallas, Austin, San Antonio, Fort Worth, and Houston may also provide information about filing procedures and requirements specific to their divisions.

Your Texas business attorney is the best resource for specific guidance on whether the Business Court applies to your business agreements or disputes. An attorney can review your situation, explain how the amount-in-controversy threshold applies to your case, and advise you on the right forum for resolving business disputes.