HB40

HB40 expands the kinds of large commercial disputes Texas’s specialized business court can hear and updates its operating rules. It lowers several thresholds from $10 million to $5 million, adds intellectual-property and trade-secret cases, and provides a route for certain older lawsuits to transfer. Signed June 20, 2025, it took effect September 1, 2025—not immediately. Final law; official history.

The $5 million rules are not a universal ticket into business court. A “qualified transaction” generally must involve at least $5 million in value; the relevant lawsuit generally must involve more than $5 million in dispute. Specified bank, credit-union and savings-and-loan lending is excluded from that transaction definition. Covered commercial-contract cases, specified financial-law claims, intellectual-property disputes and trade-secret claims have their own requirements. Interest, statutory and punitive damages, penalties, attorney fees and court costs do not count toward the threshold; joined parties’ claims are totaled. Existing corporate-governance categories already generally used $5 million, and the existing exception for a publicly traded company in those categories remains. Arbitration-related proceedings are allowed when the underlying controversy includes a qualifying claim. Sections 43 and 45; Government Code Chapter 25A.

Important exclusions remain. Medical-liability claims under Chapter 74, damages for bodily injury or death, legal malpractice, and specified consumer-transaction claims cannot enter even as related claims. Other exclusions—including insurance, family, estate and certain government-related claims—can be overcome only through the court’s limited authority over related claims, which still requires every affected party and the judge to agree. The foreclosure exclusion is narrowed to property an individual owns when suit is filed. The law does not move ordinary consumer disputes into this specialized forum. Section 45.

The changes generally apply to suits begun on or after September 1, 2024. A separate provision, expiring September 1, 2035, allows earlier suits within the court’s jurisdiction to transfer on an agreed motion and the business court’s permission, under Supreme Court rules that prioritize difficult, long-running cases and available court capacity. For newer cases, agreed removal may occur while a case is pending; contested removal has specified 30-day deadlines, including a rule for pending temporary-injunction requests. Governing documents may establish venue in specified internal-business disputes. Appeals remain assigned to the Fifteenth Court of Appeals, subject to the Supreme Court’s authority. Sections 46–48, 56 and 72.

The act also:

• Removes the scheduled abolition of six additional divisions, but retains their legislative-funding condition; moves Montgomery County from the Second to Eleventh Division; and repeals the old 2026 appointment timetable. It does not itself open six funded courts.
• Extends numerous ordinary civil procedures to business court: appeals before final judgment, records, evidence, attachments, garnishment, receivers, injunctions, agreed special-judge referrals, mediation and arbitration. Arbitration procedure alone does not create additional jurisdiction. Related cases may be coordinated for pretrial proceedings when jurisdiction exists, not automatically transferred for trial.
• Changes judicial administration, visiting assignments, recusal, training and expense reimbursement; permits up to 30 days of paid preparation before a judge’s term; adds an administrative deputy and a Judicial Council seat; and strengthens annual workload reporting. It exempts the court from Chapter 37 appointment-list rules while extending other judicial protections and duties.
• Requires counties to provide comparable court facilities with state reimbursement at the calculated local market rate, limits required planning for future facilities to counties where the court operates, and provides state reimbursement for required security. It adds judicial compensation using statutory formulas, rather than fixing a single permanent dollar salary.

Final law, Sections 1–44 and 49–71.