Business Courts: Beyond Delaware

For 200 years the Delaware Court of Chancery existed with scant competition. In the last 15 years, however, a number of states have created dedicated business courts or procedures for managing business- related disputes, sometimes in an attempt to recruit business that ordinarily would migrate to Delaware.

In most cases, the motivation for these new initiatives was to ease the burden on existing trialcourt systems, to develop judicial expertise on par with the lawyers who argue the cases before state or municipal judges, and, in some instances, to appear more business friendly.

In recent months lawmakers in West Virginia and Mississippi have announced plans to study the feasibility of establishing specialized business courts. In July, New Hampshire Governor John Lynch signed into law a bill to establish a business court, modeled after its family court. The intent was to create a system to resolve business cases quicker and improve overall court efficiency.

 

Top Business Courts Established:

 

1792 Delaware Court of Chancery

1992 Cook County, Illinois

1993 New York

1995 North Carolina

2000 Philadelphia, Pennsylvania

2000-2001 Nevada’s 2nd and 8th District

2004 Orlando, Florida

2005 Fulton County, Georgia

2007 Maine

2007 South Carolina

“Businesses move at a different speed and they need this docket to make justice more accessible to them,” New Hampshire Supreme Court Chief Justice John T. Broderick Jr. said at the time of the bill’s passage.

Certain municipalities—Las Vegas; Orlando; and Cook County, Illinois, for example—and the states of Maine, Rhode Island, and North Carolina, among others, have dedicated business courts. Jurisdictions that claim a business court typically have a specific set of judges assigned to hear business and commercial cases.

Could these states’ efforts one day challenge Delaware’s supremacy? Not likely. More than half of all American businesses are incorporated in Delaware, including 60 percent of the Fortune 500, according to the state’s division of corporations, making Delaware the jurisdiction of choice for disputes. With two centuries of case law behind it, Delaware decision-making is generally predictable, and the reputation of the state’s judges for integrity and intelligence is unparalleled.