In the heart of Houston’s bustling Energy Corridor, where skyscrapers pierce the humid skyline and dealmakers sip coffee amid the hum of oil futures trading, a quiet revolution is underway in the Lone Star State’s legal landscape. Texas, long a magnet for Fortune 500 headquarters and energy titans, has doubled down on its pro-business ethos with sweeping reforms to its judicial system. Effective September 1, 2025, House Bill 40 (HB 40) dramatically expanded the jurisdiction of the Texas Business Court to include intellectual property disputes, trade-secret misappropriation, and a broad range of high-stakes commercial claims. This isn’t mere legislative housekeeping—it’s a deliberate move to make Texas, and especially Houston, the nation’s go-to venue for “bet-the-company” litigation.
For Houston executives and general counsel, the timing could not be more critical. The city’s economy—still recovering from 2024 oil-price volatility yet energized by renewables, aerospace, and a burgeoning tech corridor—has seen a marked rise in disputes over data security, patent portfolios, and corporate governance. One recent filing in the Eleventh Business Court Division (covering greater Houston) illustrates the stakes: a local biotech company accused a competitor of stealing proprietary carbon-capture algorithms, a case that could ripple across Texas’s fast-growing green-energy sector. With nearly half of the Business Court’s 103 cases since inception landing in Houston’s division, the expanded jurisdiction is already proving its worth.
A Court Built for Modern Commerce
Launched in September 2024 under the original 2023 legislation and divided into 11 geographic divisions, the Texas Business Court was designed to relieve overburdened district courts from complex commercial matters. HB 40 lowered the monetary threshold for most claims from $10 million to $5 million, allows aggregation of claims across parties to meet jurisdiction, and explicitly brings trade secrets, patents, software disputes, and biotechnology claims into the fold. It also introduced standardized sealing procedures for sensitive information under the Texas Uniform Trade Secrets Act—a welcome safeguard for companies litigating their crown jewels.
Why Houston Feels the Impact Most
Houston’s Eleventh Division has quickly become the busiest in the state, handling everything from energy-fund governance fights to real-estate partnership dissolutions. Recent opinions on personal jurisdiction, subject-matter challenges, and arbitration enforcement demonstrate that the court is not only moving quickly but also producing precedent that practitioners statewide are watching closely.
The ripple effects extend to municipal contracting as well. Houston’s Office of Business Opportunity (OBO) program—designed to steer city contracts to minority- and women-owned businesses—has faced ongoing constitutional challenges. A 2025 disparity study prompted proposed ordinance changes to narrow eligibility in categories where disparities no longer exist. Disputes over these contracts now frequently meet the revised $5 million threshold, giving Houston companies a faster, more specialized forum than traditional Harris County district courts.
Evergreen Lessons in an Evolving System
Even as the court evolves, timeless litigation principles remain front and center:
- Trade-secret and non-compete enforcement: Texas continues to enforce reasonable restrictive covenants aggressively, and the Business Court’s new sealing rules make it safer than ever to litigate these claims without public exposure.
- Corporate governance: 2025 amendments to the Texas Business Organizations Code strengthened the business-judgment rule and allow directors to seek early declarations of independence—further incentives for companies to incorporate (or re-incorporate) in Texas rather than Delaware.
- Forum selection and venue strategy: Savvy drafters are already updating LLC agreements, joint-venture contracts, and M&A documents to designate the Business Court as the exclusive venue when permissible.
Practical Takeaways for Houston Counsel and Executives
- Review and revise forum-selection clauses—expressly naming the Texas Business Court is now a powerful tool.
- Strengthen confidentiality provisions and trade-secret identification protocols; the court’s standardized sealing orders reduce the risk of public disclosure.
- Anticipate AI-related discovery issues—the Eleventh Division’s local rules (effective March 2025) require early disclosure of AI use in document review and evidence generation.
- Monitor docket-equalization orders; the statewide panel can reassign Houston cases to less crowded divisions (and vice versa) to prevent backlog.
The Bigger Picture
Governor Greg Abbott has repeatedly declared that these reforms are part of keeping Texas “the best state in America to do business.” With major law firms adding dedicated Business Court practices in Houston and corporate filings increasingly citing the court in dispute-resolution provisions, that vision is becoming reality.
For companies headquartered along I-10, from the Energy Corridor to The Woodlands, the message is clear: the Texas Business Court is no longer an experiment—it is the new standard for sophisticated commercial litigation. Those who understand its procedures, leverage its specialized bench, and draft with its jurisdiction in mind will resolve disputes faster, cheaper, and with greater predictability than ever before.
In a city built on bold bets—whether drilling miles beneath the Gulf or launching the next energy-transition unicorn—having a court that moves at the speed of commerce is not just convenient. It’s competitive advantage.
For companies facing these complex disputes in the Texas Business Court or any high-stakes commercial litigation in the Houston area, early strategic guidance can make all the difference—Contact the Law Offices of Colby Lewis today to ensure your interests are protected by experienced trial counsel who know the new system inside and out.
