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Business Courts, sometimes referred to as Commercial Courts, are trial courts that primarily or exclusively hear internal business disputes and commercial litigation between businesses.[1]

Business and Commercial Courts in the United States[edit]

Business Courts in the United States have been established in approximately twenty-five states. In some cases, a state legislature may choose to create a business court by statute. In other cases, business courts have been established by judicial rule or order, at the Supreme Court or trial court level. In virtually all cases, the jurisdiction of the court to hear certain cases is limited to disputes that are in some way related to "business" or commercial disputes, and generally fall into two categories: (1) those courts which require that cases have an additional complexity component; and (2) those courts which establish jurisdictional parameters (i) through a defined list of case types (ii) combined with a specified minimum amount of damages in controversy, irrespective of complexity.[2] There are mixed models as well, with some mandatory case type categories specifically listed and other types requiring an element of complexity. Maryland Circuit Court's Business and Technology Case Management Program follows this approach, including certain listed "presumptive" case types within the program's mandatory jurisdiction, while other case types must be judicially determined to present "commercial or technological issues of such a complex or novel nature that specialized treatment is likely to improve the administration of justice."[3]

In New York, for example, the trial level Supreme Court Commercial Division, following the case type and jurisdictional amount in controversy model, may hear cases (1) alleging breach of contract, (2) arising under the state's business corporation law, (3) arising under the state's partnership law, (4) relating to commercial loans, negotiable instruments, letters of credit, and bank transactions, or (5) involving business torts. The Commercial Division may not, by comparison, hear cases involving (1) landlord/tenant disputes, (2) commercial foreclosures, (3) products liability claims, or (4) claims alleging discrimination except when part of or under the terms of a contract.[4] Commercial Division Rule 202.70(a) sets out jurisdictional monetary thesholds, ranging from $50,000 in some counties to $500,000 in the Manhattan Commercial Division.[5] The Massachusetts Superior Court's Business Litigation Session (BLS) includes a jurisdictional list of case types, but instead of providing a monetary threshold and making jurisdiction over these case types mandatory, its governing directive provides for inclusion of listed case types only where "the BLS in the sound discretion of the BLS Administrative Justice, based principally on the complexity of the case and the need for substantial case management," selects a case for inclusion.[6]

The modern creation of specialized Business Courts in the United States began in the early 1990s,[7] and has expanded greatly in the last thirty years.[8] Business courts (which are often business programs or divisions within existing trial level courts) are operating in New York City and 10 other jurisdictions throughout New York State as the New York Supreme Court Commercial Division,[9] Chicago, North Carolina, New Jersey, Philadelphia and Pittsburgh, Pennsylvania, Reno and Las Vegas, Nevada, Massachusetts, Rhode Island, Maryland, Orlando,[10] Miami, Ft. Lauderdale, and Tampa, Florida, Michigan,[11] Cincinatti, Cleveland[12] and Toledo, Ohio, Iowa, Maine, New Hampshire, Metro Atlanta regionally and Georgia Statewide, Delaware's Superior Court and Court of Chancery, Nashville, Tennessee,[13] Wisconsin,[14] Indiana,[15] Arizona, Kentucky,[16] South Carolina,[17] West Virginia,[18] and the Wyoming Chancery Court.[19] This mapshows states having business courts either statewide, in multiple counties or cities, or within a single major city or county, which is accurate through April 2023. In New York, Chicago, Philadelphia, Massachusetts,[20] North Carolina, South Carolina and New Jersey, among other states with business courts, the original programs have expanded by adding judges and/or by expanding into additional cities and counties.[21][22][23] In 2023, Utah adopted legislation creating a statewide Business and Chancery Court, which will become operational in 2024.[24] On June 9, 2023, Texas' governor signed an Act into law creating a Business Court.[25] The new law became effective in September 2023, but the Business Court will not be open for cases until September 2024 at the earliest.[26] The Hamilton County, Ohio Court of Common Pleas had discontinued its Commercial Docket in 2017, but revived it effective March 1, 2024.[27]

Delaware's Court of Chancery, the pre-eminent court addressing intra-business disputes, has functioned as a business court of limited jurisdiction for a century.[28] However, its traditional equity jurisdiction has evolved and expanded since 2003 to include technology disputes (10 Del. C. § 346), some purely monetary commercial disputes (10 Del. C. § 347), and to expand its role in the alternative dispute resolution of business and commercial disputes. This includes the use of mediation (10 Del. C. § 347), Masters in Chancery to adjudicate matters (10 Del. C. § 350), and agreements to make decisions non-appealable (10 Del. C. § 351).[29]

California, Connecticut,[30] Phoenix, Maricopa County, Arizona, Oregon, and Minnesota have created specialized courts or tracks for complex litigation that would include some business disputes within a broader jurisdiction of complex matters. This is not statewide in California, but includes at least the following Superior Courts: Alameda, Contra Costa,[31] Los Angeles,[32] Orange,[33] Riverside,[34] Sacramento,[35] San Francisco,[36] San Mateo,[37] and Santa Clara.[38] Arizona also has a specialized commercial court in Phoenix.[39] Other states are in various stages of moving toward or away from business or complex courts, with Colorado having conducted extensive studies nearly two decades ago into the merits and potential parameters of creating a business court on a broad basis, which was not pursued, and later experimenting with a business court, the Civil Access Pilot Project, from 2012-2015; and Orlando, Florida having to move resources away from its Complex Business Litigation program into its family court,[40] though this program was restored in October 2019,[41] New Jersey expanding to a statewide business court track in 2015, after having only two counties with specialized commercial courts for 20 years,[42] and South Carolina's Business Court went from a regional pilot program and is now a permanent statewide program.[43]

The American College of Business Court Judges was established in 2005.[44] The American Bar Association has played a significant role in the development of business courts.[45] Since 1996, the Association of Corporate Counsel has similarly endorsed the creation of business courts in the United States where appropriate.[46]

International Business and Commercial Courts[edit]

Business and Commercial Courts exist internationally as well,[47][48] including, for example, England and Wales,[49] Toronto,[50] Quebec,[51] and Alberta,[52] Canada, Ireland,[53] Scotland,[54] Denmark, Hong Kong, Belgium, Bermuda, New South Wales and Victoria Australia,[55] Northern Ireland,[56] Qatar,[57] Dubai,[58] Spain,[59] France, Switzerland,[60] Tanzania,[61] Rwanda, Lesotho, the British Virgin Islands,[62] St. Lucia,[63] India,[64] Japan,[65] and Malaysia.[66] New English language commercial courts have been created in Paris, Frankfurt, the Netherlands,[67][68][69] Stuttgart | Mannheim, Germany,[70] Singapore,[71] and Kazakhstan.[72] This reflects the growth in international commercial courts, involving disputes among parties from different nations.[73][74][75] The DIFC Courts in Dubai have had an English language international court for over a decade. Some international commercial courts include foreign judges on their bench.[76] There is a view that international commercial courts compete with the London based commercial courts as the preferred litigation forum for international commercial disputes.[77] In 2017, New York's Commercial Division added a "Large Complex Case List," modeled on the Business and Property Courts' Financial List for high stakes commercial litigation, as part of an effort to potentially compete with the London commercial courts as a preferred forum for international litigation.[78][79][80]

The jurisdictional scope of these commercial courts may have some differences with that of United States business and commercial courts. For example, the Business and Property Courts of England and Wales include specialized courts or lists for admiralty,[81] insolvency,[82] and patents,[83] which in the United States would typically be subject to jurisdiction in federal tribunals, and not in state trial level business courts, such as the United States Bankruptcy Courts[84] or the United States District Courts.

The Standing International Forum of Commercial Courts was created in 2016.[85] In its 2023 policy resolution, the Association of Corporate Counsel recognizes and endorses the creation and support of business courts internationally, as well as in the United States.[86]

Technology Disputes & Cyber Courts[edit]

In the United States and internationally, "[t]he notion of specialized courts to decide technology disputes has a rich history with noteworthy milestones."[87]

Some states have established specialized business and commercial courts that include technology disputes as part of their express jurisdiction.[88] Through legislative effort and court rule, Maryland established a Business and Technology Case Management Program. In May 2003, Delaware expanded the Court of Chancery's jurisdiction to include technology disputes, and the mediation of other kinds of business disputes (10 Del. C. §§ 346, 347).[89] West Virginia's Business Court Division Rule 24.09 expressly includes technology issues. The Davidson County, Tennessee Business Court Docket expressly encompasses technology and biotechnology licensing.[90] North Carolina's Business Court jurisdiction expressly includes computer software, information technology and systems, data and data system security, biotechnology and bioscience technology.[91] Under Michigan's statutes, MCL Sec. 600.8031(2)(b), business court jurisdiction includes business or commercial disputes "involving information technology, software, or website development, maintenance, or hosting...."[92] New York Commercial Division Rule 202.70(b)(1), addressing that business court's jurisdiction, was amended in February 2024 to expressly include "technology transactions and/or commercial disputes involving or arising out of technology".[93] This amendment is intended to make clear the New York business court's experience in handling technology disputes, especially in light of the fact that "many of the business courts in other states have emphasized their jurisdiction over and experience with adjudicating technology disputes...."[94]

There are also examples of international courts expressly addressing technology disputes as part of their jurisdiction. The English High Court of Justice has a Technology and Construction Court. The Practice Directions (Part XXIV) of Singapore's International Commercial Court include a Technology, Infrastructure, and Construction List.[95] In 2024, the Commercial Court, within Ireland's High Court, was in the process of developing "a specialist sub-list called the Intellectual Property and Technology List with specialist judges from the Commercial Court." The Victoria, Australia Commercial Court expressly includes jurisdiction over "Proceedings relating to technology, engineering and/or construction...."[96]

Some jurisdictions emphasized the idea that newly created business courts would make use of cutting edge technologies in handling business litigation, becoming so-called "cyber courts."[97] For example, North Carolina's Business Court was an early proponent of electronic filing and high-tech courtrooms.[98] New York's Commercial Division created "Courtroom 2000" making various technologies available for use by the courts and parties, while also serving as "a technological laboratory" for later use in all of New York's state courts.[99] The use of technology in case management may be especially apt in international commercial courts, with litigation between parties from different nations.[100]

Business Courts and Alternative Dispute Resolution[edit]

The significant relationship between business courts and Alternative Dispute Resolution, such as mediation, neutral evaluation,[101] and arbitration, is well recognized, both in seeing business courts as a competitor forum with arbitration, and in using ADR as a complementary adjunct to the litigation process..[102][103][104] Thus, for example, New York Commercial Division Rule 3 allows for court appointed mediators and neutral evaluators,[105] the enabling order for Philadelphia's Commerce Case Management Program creates an alternative dispute resolution program utilizing Judges Pro Tempore within court mandated settlement conferences, and discretionary referrals to private mediation,[106], North Carolina Business Court Rule 11 addresses mandatory mediation,[107] and Florida's Ninth Judicial Circuit Business Court Procedures, Section 8, requires mandatory ADR for each case, and addresses non-binding arbitration as well as mediation.[108] The Business and Property Courts of England and Wales Commercial Court Guide, Section G, addresses "Negotiated Dispute Resolution" (NDR), including mediation, conciliation, direct negotiations between party representatives, and early neutral evaluation.[109] A few business courts expressly encourage the use of special masters or referees in expediting some types of decision making during the litigation process.[110][111]

References[edit]

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External links[edit]

source: https://en.wikipedia.org/wiki/Business_courts

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