Thank you for sharing!

Your article was successfully shared with the contacts you provided.
A blue ribbon panel later this month will recommend that Maryland establish the nation’s first court program designed specifically for business and technology lawsuits. At a Nov. 27 public meeting, a task force appointed by the Maryland Legislature will unveil a proposal to establish, according to its final report, a “statewide program with specially trained judges and mediators to resolve substantial disputes affecting business entities, including the unique and specialized issues involving technology.” The emphasis on technology-related litigation would be unique. But Maryland wouldn’t be the first to create a special court for business cases. Nine states — Delaware, Illinois, Massachusetts, Nevada, New Jersey, New York, North Carolina, Pennsylvania and Virginia — already have special courts or separate judicial tracks for business suits. Connecticut and California send big business cases to “complex litigation” courts. Thirteen additional states have investigated or are currently studying business courts or programs. The nationwide movement reflects the growing trend toward “voluntary specialization of general jurisdiction judges,” says Circuit Court Judge Steven I. Platt, the vice chairman of Maryland’s task force. “Whether we like it or not, the rest of the world is getting more complicated, and the business community is becoming more specialized,” says Judge Platt. “Courts have to keep up.” Technology cases have a clear need for specially trained judges, according to task force member Steven E. Tiller, an intellectual property partner at Baltimore’s Whiteford, Taylor & Preston. “It’s helpful to have [a judge] who can recognize [technological] phrases, and who has experience in handling these issues,” Tiller says. The states have experimented with different methods to tame the beast of big business cases. Maryland had to look no further than its eastern neighbor for a venerated business court. Delaware’s Chancery Court is not limited to corporate cases, but the forum has a 208-year track record in resolving corporate governance and shareholder disputes. In testimony before the Maryland task force, Chancellor William Chandler credited his court’s national reputation to its thorough understanding of corporate issues — honed by a 95 percent business docket, collegial discussions of complex issues and review procedures to ensure consistent decisions. Illinois and New York have created business divisions in their busiest city courts. Since 1992, the Cook County court in Chicago has had a special commercial calendar. It has grown from three judges to seven and now has some 31,500 cases on its docket. Jerold S. Solovy of Chicago’s Jenner & Block says that the court’s expeditious procedures and experienced judges allow cases to be tried in a year — or less. Solovy recalls that in one “fast track” case, “I sued in January, and we went to trial in February.” In 1995, New York established a commercial division of the Manhattan trial court. The court’s specially designated judges, expedited procedures and alternative program soon yielded improvements in judicial efficiency. Within a year, cases referred to the court showed a 85 percent increase in pre-trial settlement and 29 percent reduction in disposition time. Commercial divisions have since been set up in two nearby suburban counties, Nassau and Westchester, and in upstate Rochester and Buffalo. New York’s system enjoys widespread support from in-house counsel and the corporate bar, says Robert L. Haig of New York’s Kelley Drye & Warren. “Lawyers vote with their feet,” says Haig, citing 6,000 filings annually in the Manhattan commercial division. “Now there’s talk about filing cases in state court, rather than in federal court or in ADR,” he says, referring to alternative dispute resolution. Haig has become one of the bar’s biggest boosters of business courts, advising nine states and five countries on setting up these tribunals. He cautions, however, that use of commercial courts “only makes sense if there are a substantial number of business cases. You wouldn’t do it in South Dakota.” North Carolina found that its volume of corporate litigation did not warrant countywide business courts. Instead, one superior court judge is designated to hear “complex business cases” statewide. The state supreme court has also approved fast-track procedures for cases involving “significant commercial development,” when the amount in controversy tops $500,000 and the parties waive jury trial and punitive damages. NECESSARY AND PROPER? Some judges and lawyers question whether states should be in the business-court business. They note that the U.S. district courts have diversity or federal question jurisdiction over many complex business cases. Federal courts also decide the patent, copyright and trademark claims at the heart of many technology-related lawsuits. Critics also worry that first-class treatment for business cases means second-rate handling of other litigation. “We don’t favor specialized courts for particular types of cases,” says Carlton Carl, spokesman for the Association of Trial Lawyers of America. “We think it’s a bad practice.” Especially troubling to some observers is the promotion of business courts as a business-friendly policy. The Maryland task force report predicts that its proposed program will improve the state’s “reputation as a place where disputes involving substantial business interests are effectively and efficiently resolved, thus increasing Maryland’s reputation as a favorable place to do business.” Philadelphia’s new “commerce court” has been similarly publicized by one of its judges. “The business community is very interested in efficient, timely, quick resolutions of matters,” said Administrative Judge John W. Herron in announcing it last year. In a March 15 letter to Philadelphia’s Legal Intelligencer, seven lawyers objected that the problems in the Philadelphia courts “cannot and should not be fixed by patchwork solutions for the privileged few only.” “Why isn’t a complex medical malpractice case worthy of top-notch judicial attention?” the lawyers wrote. “What about asbestos or other mass tort cases, or criminal or family court matters? Are we to surmise that the judiciary does not value these cases enough to assign them the very best judges?” The lawyers also speculated whether consumer class action or shareholder plaintiffs might question the impartiality of the commerce court after Judge Herron has “already publicly explained that the purpose of the court is to meet the needs of business interests here in Philadelphia to procure ‘efficient’ resolution of their disputes, in order to [maintain] certain business ‘relationships.’ “ One of the signers, John Soroko of Duane Morris & Heckscher, says that the initial controversy over Philadelphia’s commerce court has died out and the court enjoys wide support by the bar. He adds that no one, least of all his fellow business lawyers, disputes the need for efficient, rational adjudication of complex commercial litigation. Soroko still believes, however, that there is an argument that a business court “is potentially incompatible with the notion of equal access to justice.” Local judges and bar leaders also sent the wrong signal to litigants and the public by promoting the commerce court as “business-friendly,” Soroko says. “It’s not the court’s role to be a ‘friend to business.’ The court should be a friend to everyone.” Maryland’s Judge Platt does not believe that special procedures for business cases implies preferential treatment for business litigants. Despite the claims in the task force report, he doubts that judicial factors play much of a role in companies’ decisions to expand or relocate. “I can’t imagine a business saying, ‘Let’s move to Maryland, they’ve got a good court system,’ ” Judge Platt says. Maryland judges have “ let it be known that we did not want the judiciary to be a marketing tool for the state business community,” he says. Haig, of Kelley Drye, also “emphatically disagrees” that business courts are inherently elitist or biased. He argues that New York’s commercial division benefits nonbusiness litigants by reducing disposition time and increasing settlement rates on a courtwide basis. Business suits are different from other cases, Haig says, and are more likely to be resolved through pre-trial motions. “It’s not elitism to give this kind of work to judges who are the best at it.”

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.