With its sophisticated and business-savvy court system, Delaware attracts more than half of America’s corporate charters. Now Texas, hoping to create a similar draw, is considering creating its own chancery court to handle complex business disputes.

If enacted, House Bill 1603 would create a new Texas chancery court with concurrent jurisdiction over securities claims, shareholder-derivative actions, internal-governance disputes, and other complex corporate cases. Seven chancery judges, appointed by the governor and drawn from both political parties, would sit on the trial court. Another seven judges would form the chancery court of appeals, with the Texas Supreme Court still ultimately deciding any civil appeals. Chancery judges would have business backgrounds (at least ten years in “complex business transaction law” or “complex civil business litigation”) beyond the basic requirements for elected district judges (four years of legal practice).

The bill’s supporters say that a chancery court much like Delaware’s would resolve complex business litigation more quickly and before judges with specialized experience in the field. And if so, we may see an uptick in businesses choosing to incorporate in Texas. The full bill is available here and updates on its progress through the legislature are available here.

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