The Lone Star Docket: How the Texas Business Court Will Shape the Corporate Landscape

Authors

Shane Goodwin, PhD, Southern Methodist University (SMU) - Finance DepartmentFollow

Publication Date

11-18-2024

Abstract

With the establishment of the Texas Business Court, Texas signals its ambition to become a formidable competitor to Delaware's dominance in corporate litigation. This paper examines how this specialized court, launched in 2024, is poised to reshape the landscape of corporate law against the backdrop of growing critiques of Delaware's Court of Chancery and the emerging "Dexit" phenomenon.

However, Texas faces significant challenges, including the lack of established legal precedent, the complexities of managing jury trials in intricate corporate disputes, short judicial appointment tenures, and the critical need to build trust with corporate entities and the legal community. As Texas positions itself as a competitive venue for corporate litigation, this paper assesses the strategic advantages and potential obstacles for the new court, exploring whether Texas can rise to meet Delaware's enduring legacy. Additionally, I provide recommendations to address these challenges, aiming to bolster the Texas Business Court’s potential for success and establish it as a redefined standard for business adjudication in the United States.

Document Type

Article

Keywords

Delaware, Texas, Corporate Law, State competition, Controlling Shareholder, Duty of Loyalty, Duty of Care, Duty of Good Faith, Texas, Business Court, Musk, Securitities Law, Texas Business Court, Delaware Court of Chancery, Corporate Law Reform, Federalism in Corporate Law, State Court Competition, Business Litigation, Shareholder Rights

Disciplines

Finance

DOI

10.2139/ssrn.5024710

Source

SMU Cox: Finance (Topic)

Language

English