Texas Business Court’s Broad Reach a Big Deal for Energy Sector

Texas has officially entered the race to become the nation’s second hub of corporate law, but at its core, the Texas Business Court expands access to justice.

The business courts were designed to streamline resolution of disputes that are both high-value and central to Texas’ economy.

Texas is already home to many of the country’s largest energy and technology companies; it only lacked a dedicated forum for complex business litigation. Traditional courts in Houston, Dallas, and other major cities were already handling heavy dockets of high-stakes commercial cases, often competing with criminal and family law matters.

With its new business courts, the state is positioning itself as a rival to Delaware, offering specialized judges and jurisdiction over high-value corporate and commercial disputes. Competition with Delaware wasn’t the main purpose, though Texas has benefited.

Some high-profile companies have already moved from Delaware to Texas in search of predictability, signaling a broader “DExit” trend. Both Tesla Inc. and SpaceX moved from Delaware to Texas, MercadoLibre proposed moving its US legal domicile from Delaware to Texas (subject to shareholder vote), and Meta Platforms Inc. earlier this year reportedly was exploring or in talks about reincorporating outside Delaware (including Texas) as part of its strategic review. These moves reflect growing unease with Delaware’s standards and highlight why Texas’ reforms are drawing attention.

The new courts aren’t corporate courts in the Delaware sense. Texas’ business courts have jurisdiction extending beyond internal governance and derivative actions to include large commercial disputes—such as contract and “qualified transaction” cases exceeding $10 million, which often encompass high-value oil and gas matters. That broader reach makes them especially significant for companies embedded in Texas’ energy economy, where litigation often blends governance questions with complex commercial and regulatory issues.

A critical difference lies in the role of juries. Delaware’s Court of Chancery hears cases in equity, with judges deciding disputes without juries. Texas’ business courts, on the other hand, permit jury trials, even in high-value commercial and governance disputes.

That choice reflects Texas’ legal culture but also adds complexity. Although specialized judges bring expertise, litigants must still account for the unpredictability of jury decision-making in complex business cases.

Notably, the Texas Legislature has already responded to concerns that the availability of jury trials could discourage incorporation in the state. During the 2025 session, lawmakers amended the Texas Business Organizations Code to permit corporations to include a waiver of jury trials in their charters or governing documents.

Framed alongside other pro-management adjustments, the reform allows organizers to decide whether to retain the traditional jury right or opt for the predictability of bench trials—further signaling Texas’ effort to attract and protect corporate managers and founders.

While most business disputes still arise from contracts, employment, intellectual property, and regulatory matters, shareholder and internal-affairs claims make up a comparatively small slice of corporate litigation.

Studies of derivative and fiduciary-duty suits show that they are relatively rare outside of mergers and acquisitions contexts—and even when filed, they often settle before trial.

That reality helps explain Texas’ choice to design a broad business court to ease the load on district courts—covering high-value commercial disputes and permitting jury trials—rather than replicating Delaware’s narrow chancery model.

Although the docket is still light, early filings point toward energy-sector disputes. Roughly a quarter of the Texas Business Court’s first-year cases involved oil and gas companies such as BP Energy, Mobil Oil Exploration and Producing, and Marathon Oil. Houston and Dallas divisions are handling most filings, and practitioners are watching to see how judges balance Texas’ jury-trial option with Delaware’s tradition of bench-only corporate cases.

Supporters say juries could make the process more accessible and transparent, while critics warn that verdicts offer little guidance for future deals. Practitioners are watching closely to see how Texas judges balance speed and predictability against the lack of precedent. For companies based in Texas, the courts promise the chance to litigate closer to home before judges steeped in business issues.

Recent legislative developments underscore Texas’ orientation. Alongside creating business courts, Texas has passed measures that narrow shareholder rights, particularly in areas of inspection and derivative litigation. The moves align with a broader trend toward shielding boards from expansive oversight suits, mirroring some of Delaware’s retrenchment but with an even more business-friendly tilt.

For companies considering incorporation or litigation strategy, the signal is clear: Texas is positioning itself as a jurisdiction that favors management stability and founder control over shareholder activism.

That message was reinforced at the end of last month, when the Securities and Exchange Commission formally approved the Texas Stock Exchange to operate as a national securities exchange. Headquartered in Dallas and set to launch trading in early 2026, the TXSE markets itself as a business-friendly alternative to New York Stock Exchange and Nasdaq, promising lighter compliance burdens and fewer environmental, social, and governance pressures.

Paired with legislative reforms and the new business courts, the exchange positions Texas not just as a rival forum for litigation but also as the nucleus of a broader corporate ecosystem built around pro-management priorities.

What do these developments mean in practice? The answer depends on where you sit. For boards and general counsel, Texas courts present an attractive venue—specialized judges, faster dockets, and legislation that signals a friendlier stance toward management and founders.

But that tilt also raises concerns; leaning too heavily toward management may invite skepticism from investors and increase the risk of forum-shopping battles.

For investors, the picture is more complicated. Dual-tracking litigation in Delaware and Texas may become a necessary hedge, but the pro-management posture of Texas courts and recent legislation limiting shareholder rights suggest that outcomes may skew against them. Investors will need to weigh whether pursuing oversight claims in Texas offers meaningful recourse or simply entrenches management.

Founders and management teams will welcome this. Texas is actively building a legal ecosystem that protects entrepreneurial control and shields against what it frames as abusive shareholder litigation.

But even for them, the absence of a developed body of precedent introduces uncertainty—management may gain stronger protections in theory but face less predictability in practice. Forum choice may therefore become a more explicit part of risk management for growth-stage companies and startups, not just for large public corporations.

The recommendation for legislators isn’t simple. Advising clients in this environment means more than mastering the new statutes and procedures.

It requires guiding companies, investors, and founders through a policy tradeoff: between speed and precedent, local expertise and national norms, pro-founder protections and investor accountability. The practical challenge is helping clients build strategies that hedge against uncertainty while making the most of Texas’ new forum.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Carliss Chatman is a professor at SMU Dedman School of Law. She writes on corporate governance, contract law, race, and economic justice.

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