On May 13, the Supreme Court of Georgia approved new rules governing the Georgia statewide Business Court. The new rules, which take effect on August 1, significantly expand parties' access to the Business Court, among other things.
The Business Court has jurisdiction over a wide variety of business disputes. Before adopting the Business Court's new rules, however, the Business Court could hear cases only if both parties consented. As of August 1, that will no longer apply. Below find more information on the new methods of proceeding before the Business Court.
Filing Suit in the Business Court
Assuming the case is within the Business Court's jurisdiction, a plaintiff can now file suit in the Business Court even if the defendant does not consent under the new rules. See BCR 2-4(a). However, defendants can object to the action proceeding in the Business Court by filing an "objection to jurisdiction" with a proposed order that seeks transfer of the case to a venue-appropriate superior or state court. See BCR 2-4(b). Such an objection to jurisdiction must be filed within 30 days after all defendants receive a copy of the initial pleading through service of process. See O.C.G.A. § 15-5A-4(a)(1).
Transfer or Removal to the Business Court
The Court's new rules also grant broad rights to defendants to transfer lawsuits to the Business Court from Georgia's various superior and state courts. Under BCR 2-4(a), a defendant may file a "petition to transfer" within 60 days after service of a complaint on all defendants in the lawsuit. That 60-day deadline does not apply, however, when the basis for a petition to transfer becomes apparent only after the initial complaint is filed. In such cases, BCR 2-4(f) permits a defendant to seek a transfer after its receipt of a "copy of an amended pleading, motion, order, or other document from which the party petitioning to transfer may first ascertain that the action is transferable." See O.C.G.A. § 15-5A-4(a)(3). Thus, for example, if a plaintiff amends its complaint to add a claim that is subject to the Business Court's jurisdiction, the defendant then may seek to transfer the case to the Business Court within 60 days of its receipt of the amended pleading.
The petition to transfer should contain "a short and plain statement of the grounds for the transfer, together with a copy of all process, pleadings, and orders served upon each party." See BCR 2-4(f). A party opposing transfer must file an objection to jurisdiction within 30 days of the filing of the petition to transfer. Id.
Parties may still proceed before the Business Court by agreement, again assuming the case falls within the Business Court's jurisdiction. Actions may be transferred to the Business Court by agreement by filing a "petition for removal" within 60 days of such action being filed in the superior or state court. See BCR 2-4(a); O.C.G.A. § 15-5A-4(a)(2). Like a petition to transfer, a petition for removal must contain "a short and plain statement of the grounds for removal and all parties' agreement to remove the action, together with a copy of all process, pleadings, and orders served upon each party." See BCR 2-4(e).
Parties seeking to remove or transfer an action to the Business Court must also notify the superior or state court by filing either a "notice of removal" or "notice of transfer," whichever is applicable, with the clerk of the superior or state court where the action was then pending. See BCR 2-4(j). Thereafter, the action is stayed unless and until the Business Court declines to exercise jurisdiction over the action, and, if applicable, transfers the action back to the superior or state court from where it was removed or transferred. Id.
Forum Selection Clauses
The new rules also confirm that parties can agree to the Business Court via contract through forum selection clauses. Under BCR 2-4(d), a forum selection clause "specifically identifying the Business Court" will be enforced to the extent it is consistent with O.C.G.A. § 15-5A-4(a)(1) and not otherwise invalid under Georgia law. Thus, if parties contractually stipulate, they can agree in advance to have their claims arising under the contract decided by the Business Court (so long as the underlying dispute otherwise satisfies the Business Court's jurisdiction requirements).
The Business Court's Jurisdiction
It is important to keep in mind the extent of the Business Court's jurisdiction when analyzing whether it is the appropriate venue for your case:
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The Business Court has expansive subject matter jurisdiction over various categories of commercial disputes, provided the amount-in-controversy requirement is satisfied. These categories include claims for breach of contract, fraud, or misrepresentation; business torts; professional malpractice claims arising out of a business dispute; claims arising from e-commerce and technology licensing agreements; claims involving commercial real property; the Uniform Commercial Code; Georgia Arbitration Code; Georgia International Commercial Arbitration Code; Georgia Trade Secrets Act of 1990; Georgia Uniform Securities Act of 2008; Georgia Business Corporation Code; Uniform Partnership Act; Georgia Revised Uniform Limited Partnership Act; Uniform Limited Partnership Act; Georgia Limited Liability Company Act; and Internal Affairs Doctrine.
The new rules go into effect on August 1. Until then, the Business Court will continue to operate under the existing Uniform Superior Court Rules and, notably, will require the consent of both parties.
