A bill was recently passed in the House of Representatives that proposes giving Pennsylvania’s Superior Court and county courts the authority to establish commerce court divisions in Pennsylvania. The commerce division would utilize two of the court’s fifteen judges and three senior judges with jurisdiction over business cases – including corporate acquisitions, mergers, dissolution, liquidations or other matters concerning corporations, as well as limited liability companies, trusts, sole proprietorships and corporate partnerships.
Pennsylvania court officials have agreed to institute a pilot program if the bill, sponsored by State Representative Seth M. Grove, R-York, passes in the Senate. Senate Judiciary Committee Chairman Stuart Greenleaf said that he plans to propose his own more expansive legislation, which proposes an entirely new independent business court. He has stated that the costs of this new court would be offset by the benefit to the state’s economy. Greenleaf reports that his legislation has been in the works for several months and he plans to introduce it soon.
These proposals are aimed at making Pennsylvania more hospitable for businesses. Representative Grove’s bill seeks to imitate the model of Delaware’s Chancery Court, which has helped make Delaware the nation’s business capital. More than one million businesses and half of all publicly traded U.S. companies are registered in Delaware. Businesses are drawn to Delaware because its Chancery Court offers quick resolution of conflicts and certainty of outcomes.
Delaware’s Chancery Court handles shareholder lawsuits, disputes between board members, challenges to mergers and acquisitions and other civil matters. Cases in the Chancery Court are decided by judges, not juries, and a written opinion is issued for each case. These opinions provide a body of case law that can aid litigants in resolving their cases.
Critics of Pennsylvania’s plan argue that the bill is unnecessary because Pennsylvania courts already have the power to create specialized court programs, such as a commerce division. For example, we have seen programs spring up to address criminal charges against veterans and the mentally ill. Philadelphia and Allegheny Counties, where most of the state’s business disputes occur, already have divisions dedicated to addressing these types of cases.
Philadelphia Business Lawyers at Sidkoff, Pincus & Green Represent Clients in Business Transactions and Contract Disputes
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