X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Virginia and its Dulles Corridor are widely known as the Washington region’s high-technology cornerstone. But there are a lot of lawmakers in the Maryland General Assembly who badly want to change that perception. By Dec. 1, a blue-ribbon panel appointed by legislators and bar groups is expected to recommend the formation of some type of special business and technology court in the state. Business courts, which have been adopted in various forms in other states, generally draw on a small pool of judges who are restricted to hearing complex disputes between two companies. Supporters of a new court say it would lure to Maryland some of the dot-com enterprises that now almost reflexively put down roots in Virginia. The trend toward business-only courts has been criticized by some observers who say they involve an unfair preference for speeding up commercial cases rather than consumer complaints or negligence cases. Others doubt that they are an effective way of drawing businesses to a state. The Maryland legislature, however, is clearly intrigued by the idea. Last spring, with a total of only four dissenting votes, both houses of the General Assembly passed a bill setting up the panel and ordering it to write a report by Dec. 1. The bill’s chief sponsor was Maryland House Speaker Casper Taylor Jr., who has made no secret of his ambition to make his state “the Delaware of the Internet,” referring to the state that lures corporations for its business-friendly laws. Taylor hails from the economically depressed western section of Maryland. He wants to replace the coal and railroad industries, whose day has passed, with high-tech newcomers that will grow with the new century. “If we create this kind of specialized court, together with a strong aggressive body of statutory law that will protect the new world of electronic commerce, we can create a haven for that kind of investment to be domiciled here,” says Taylor. “The world of fiber optic highways is the world of 21st century information and knowledge. We can be in the vanguard of this new odyssey if we play our cards right.” EXPERIENCE COUNTS The Delaware analogy is apt. For many decades, that state has been a corporate mecca because of its specialized courts and its highly developed body of corporate and commercial law. As many as 70 percent of the nation’s largest firms are incorporated there. There’s a national trend toward business-only courts. The New York state courts set up a special Commercial Division in 1995, and the Philadelphia Court of Common Pleas opened a Commerce Case Management Program as part of the court on Jan. 1, after an effort to set up commercial courts statewide in Pennsylvania failed in the state legislature. Legislative supporters in the Maryland State House pointed out that no other state has a trial court specifically dedicated to technology cases. Business and technology lawyers in the state tend to be supportive. “Longer and more complicated business cases would benefit from having experienced judges. We don’t have a lot of appellate law now in Maryland in the business and commercial areas,” says Baltimore sole practitioner Susan Souder, a member of the new state task force studying the issue. “My business clients would appreciate the opportunity to have such a court.” James Thompson of Rockville, Md.’s Miller, Miller & Canby, who just ended a term as president of the Maryland State Bar Association, has studied the issue as much as any other Maryland lawyer has and helped appoint the task force. Although Thompson hasn’t made up his mind on the question, he points out that the Delaware Chancery Court “has 107 years of case law behind it. It permits that state to speak with knowledge on corporate issues.” But Thompson and others point out some possible pitfalls of specialized business courts. “Would a separate court siphon the good judges out of the existing courts?” Thompson asks. “And how important is it, really, to have a business and technology court in Maryland? Is it among the top five considerations that businesses have in deciding where to locate?” THE VIRGINIA EXPERIENCE Virginia, after all, doesn’t have a specialized commercial court, and that hasn’t stood in the way of the phenomenal growth of the information industries there. Virginia lawyers seem to think the state’s courts already handle complicated technology cases just fine. “I have very high respect for the benches of both the Fairfax County and Loudoun County circuit courts,” says Brian Ebert, a litigation partner in McLean, Va.’s Foust & Clark. “I’m amazed at their ability to adapt, to go from a divorce case to a technology case to a partnership dissolution case.” Lately, Ebert points out, the state judges have become “a lot more accepting and enlightened” in following precedents from federal trial and appellate courts in the business and high-tech areas. Richard Byrd, a partner at Byrd & Mische in Fairfax, Va., and a member of the Virginia State Bar’s technology task force, is skeptical of the whole idea of specialized technology courts. “When I talk to [Virginia trial] judges, they say the highly technical aspect of these cases are usually not the basis on which they are decided,” says Byrd. “These cases are about stealing employees, trade secrets, or contract disputes. These are the same legal concepts, whether you’re selling apples or computer code.” Byrd also points out that the truly arcane area of intellectual property, which motivates so many high-tech disputes, is exclusively a part of federal law, so there’s nothing that a state legislature can do to affect that. In the federal system, there are some long-standing trial courts with special jurisdiction, such as the Court of Federal Claims. But over the years, the Judicial Conference, which speaks for federal judges, has said that it “has consistently opposed the establishment of specialized courts in the judicial branch.” Walter Effross, a professor at American University’s Washington College of Law and director of its e-commerce program, is a vocal opponent of specialized technology courts. “To the extent that state judges have to deal with the technology, they could have the parties appoint an expert or bring in their own expert or special master,” says Effross. “And there is always the problem of perception, whether or not the perception is justified, that the court will tilt in favor of local companies or in favor of those incorporated in Maryland, and against consumers or out-of-state plaintiffs.” Effross adds, “If you allege that someone has defamed you in an online chat room, a judge doesn’t need a massive understanding of technology to write that opinion.” Yet, specialization has its own virtues, according to Mitchell Bach of Philadelphia, Penn.’s Fineman & Bach, a commercial litigator who is vice chair of the American Bar Association’s task force on business courts. “Judges who specialize can handle their cases much better,” says Bach, who was the guiding force behind the new Philadelphia court. “The results are more predictable. Case management is more streamlined. Alternative dispute resolution becomes easier, and money is saved.” The Maryland task force met on Aug. 9 in Annapolis and heard from several witnesses, including the head of the Delaware Chancery Court. According to Thompson, several members expressed the view that if the state were to adopt any type of proposal, it would probably be a “minimalist” one that would not involve building any new courthouses or even setting up any new courts. Instead, a proposal that might work would be a more informal one that would match judges who are interested in technology cases with those cases as they come along.

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

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 © 2020 ALM Media Properties, LLC. All Rights Reserved.