On March 16, 2015, the Tennessee Supreme Court established the Davidson County Business Court (“Business Court”), a pilot project to meet the litigation needs of existing and future businesses in the State. A full copy of the Order is here.

Tennessee joins 26 other states which have established specialized business courts, “including Alabama, Florida, Georgia, North Carolina, South Carolina and West Virginia, where creation of specialized business courts have proven an effective tool for business retention, economic development, and enhanced effectiveness of the judicial system.”

The Business Court will handle complex business cases, and will provide “expedited resolution of business cases by a judge who is experienced and has expertise in handling complex business and commercial disputes.” The Business Court will provide “proactive, hands-on management with realistic, meaningful deadlines and procedures adapted to the needs of each case for customized, quality outcomes.” The Business Court will also “develop a body of rulings from which lawyers and litigants can better predict and assess outcomes and business cases.”

Davidson County Chancery Court Part III (Chancellor Ellen Hobbs Lyle) will serve as the Business Court. Eligible cases are (1) civil cases filed after May 1, 2015, which (2) seek at least $50,000 in compensatory damages or primarily injunctive or declaratory relief, and (3) satisfy one or more of the following:

  1. relate to the internal affairs of businesses;
  2. involve claims of breach of contract, fraud, misrepresentation, breach of fiduciary duty or statutory violations between businesses;
  3. constitute a shareholder derivative or commercial class action;
  4. involve commercial real property disputes;
  5. involve business claims between businesses relating to contracts, transactions, or relationships between them;
  6. arise from technology licensing agreements, or any agreement involving the licensing of intellectual property rights, including patent rights;
  7. constitute an action for violations of a noncompete, non-solicitation, a confidentiality agreement, or an antitrust, trade secret, or securities-related action; and/or
  8. relate to commercial construction contract disputes and/or commercial construction defect claims.

A litigant who wishes to proceed in Business Court must file with the Business Court a Request for Designation within 60 days of service of the complaint. “Upon the recommendation of the Business Court Judge, the Chief Justice shall determine whether a case meets eligibility criteria,” and may transfer the case to the Business Court. Any objection to the transfer must be filed with the Chief Justice within 30 days of the order transferring the case.

Cases filed outside of Davidson County may also be transferred to Business Court if the parties file with the Chief Justice (1) a joint motion to transfer the case to Business Court, and (2) a Joint Consent and Waiver of Venue Form. Transfer to the Business Court is discretionary.

The Tennessee Rules of Civil Procedure and Evidence apply in Business Court. The Business Court may also establish Rules of the Business Court, and may develop case management procedures for the efficient handling of cases with quicker resolutions and reduced litigation.

To more effectively meet the litigation needs of existing and future businesses in the State, the Tennessee Supreme Court will create performance evaluations to be completed by attorneys and litigants in Business Court. The evaluations will be used to identify the effectiveness, efficiency, and best practices of the Business Court.