AUSTIN — It was a mixture of triumphs and defeats for Texans for Lawsuit Reform this past legislative session, as some bills failed to make it across the finish line while others did – soon-to-be laws that will “encourage even more businesses to relocate and operate in Texas.”
Kathleen Bashur, communications director for TLR, says bipartisan passage of HB 40, which enhances the state’s business court, is a major victory for the Lone Star State.
“Establishment of the Texas Business Court in 2024 was a significant investment in Texas’ economic growth and development, creating an efficient process to help streamline the resolution of lengthy and complicated business cases,” Bashur said.
“HB 40 builds on this success, and includes enhancements that will unleash the full potential of the Texas Business Court and encourage even more businesses to relocate and operate in Texas.
Passage of HB 40 follows the enactment of another critical piece of legislation, SB 29, which aims to give Delaware a run for its money.
“SB 29 introduces a series of corporate reforms,” Bashur said. “(These reforms) will make Texas the preferred destination for corporate relocation and reincorporation by codifying the business judgment rule and allowing corporations to establish a minimum ownership threshold before a shareholder or group of shareholders can pursue a derivative claim, among other provisions.”
Not every bill TLR advocated for cleared the Texas Legislature, however, including SB 30, which sought to stop personal injury lawyers and collaborative healthcare providers from inflating medical damages.
Once the bill was introduced, the Lone Star Economic Alliance, an arm of TLR, launched a six-figure multimedia advertising campaign in support of the bill, placing billboards in high-traffic areas while running digital ads.
SB 39, which relates to civil liability of a commercial motor vehicle owner or operator, also failed to pass.
Essentially, SB 39 would’ve prevented juries from hearing certain evidence, including facts about the truck driver, until after they vote to deem a company liable for the collision.
After the 89th Session ended, LSEA issued the following statements on the two bills: “The meaningful reforms included in SB 30 and SB 39 would have been an essential step toward curbing the meritless lawsuits plaguing Texas businesses of all sizes, across all sectors, by preventing unjustified damage awards, and restoring fairness and transparency to the courtroom.”
Although SB 30 passed both chambers of the legislature, a disagreement on final language in the conference committee kept the bill from making it over the finish line.
Part of SB30 was in response to a 2023 Texas Supreme Court decision wiping out a $15 million award in a wrongful death lawsuit involving an 18-wheeler collision that cost four people their lives.
A jury had awarded $16.8 million to the plaintiffs, $15 million of which was for noneconomic damages.
Justices held the award was excessive, opining that nothing in the record demonstrated a rational connection between the injuries suffered and the amount awarded.
