Will Iowa Need a "Business" Court to Compete?

Business people often express frustration about our court system.  Litigation costs have skyrocketed, cases take too long to resolve and overworked judges don't have the time to adequately concentrate on certain complex business cases when the courts are clogged with foreclosures, family law and criminal law cases.  One solution that may help reduce those frustrations is the implementation of a specialized "business" court. 

As discussed in a blog post by Ohio business lawyer Terri Rasmussen the driving force behind the trend is the belief that a specialized business court is instrumental in retaining and attracting businesses to the state.  Ohio is trying a four-year pilot program and New Hampshire recently passed legislation to implement its own business court. 

The most historic of business courts is the Delaware Court of Chancery.  As a result, Delaware's Division of Corporations boasts that more than a half a million business entities make their legal home in Delaware including more than 50% of all U.S. publicly-traded companies and 60% of the Fortune 500.  Most observers say it is because of the predictability in Delaware's business courts. 

Rasmussen points out that Chicago, Manhattan, and North Carolina have had such courts for more than a decade and Rhode Island, Massachusetts, Las Vegas, Reno, Atlanta, Boston, and Pittsburgh have also instituted business courts in some form. Most recently Maine and South Carolina have implemented programs. Colorado and Michigan are currently giving serious consideration to the possibility.

I am a proponent of a specialized business court here in Iowa.  As Gov. Lynch of New Hampshire said when the approved his state's legislation this past month, "It is very important that our judicial system is equipped to handle efficiently the complexity of business statutes and conflicts..."  Businesses need to have courts that will resolve their cases quicker and with greater efficiency especially when litigation costs are so significant.  The way other states are moving on this it appears Iowa should consider a business court soon or face yet another hurdle in retaining and attracting good businesses.

- Rush on Business

photo on flickr by turtlemoon

Comments

[Becci Hall]

Interesting idea. I can see how it can make sense. With as bureaucratic as government is, there is a paradox in what it would take to get started ... it takes a long time to get something built that will simplify life! There is definately something wrong with that thought!

Great post, Rush! I love to have my thinking challenged!

[Rush Nigut]

Becci:

Thanks for the comment. It always nice to hear when you have challenged someone's thinking. Great point about how long it often takes to simplify life. That would probably be the case here as the courts are struggling for resources and with a recent referendum being defeated for a new courthouse it could be difficult to implement a business court soon.

Rush