Indiana commercial courts open for business

No ribbon-cuttings heralded the opening of Indiana’s six commercial courts around the state June 1, but lawyers with complex business disputes have found their way to the forums the Supreme Court established as a pilot project.

Marion Superior Judge Heather Welch told members of the Indianapolis Bar Association recently that to some degree, the way the courts function will be up to the lawyers using them. Welch is one of six judges around the state assigned to hear commercial court cases, and she said about a half-dozen such cases were filed in her court in the pilot’s first six weeks. She encouraged lawyers to approach the commercial courts with creativity in mind and as a forum for new ideas.

“We need to know what works and what doesn’t work,” said Welch, who served on the working group that developed the specialized docket. The group created a handbook to provide guidance and rules lawyers need to know when filing in commercial courts, but she noted, “the handbook is not intended as a limitation on experimentation.”

‘Looking for solutions’

Ice Miller LLP partner Adam Arceneaux filed one of the first cases in Welch’s commercial court. It’s a case involving an employer-employee relationship, trade secrets and a non-compete agreement. The laws of Indiana and Pennsylvania govern various issues in the matter.

Arceneaux

The case is “squarely within the type of lawsuit the Supreme Court envisioned being handled by the commercial court,” Arceneaux said. “People are looking for solutions, they’re looking for results, and the commercial courts offer a venue for business disputes to be resolved quickly, efficiently and effectively.”

Welch told lawyers she strives to rule on discovery and other non-dispositive motions within eight days of the completion of briefing under the new docket. She stressed the courts will set case-management plans at the outset and settlement conferences will take place very early in the process. The format also allows the court to appoint subject-matter experts such as accountants or architects to hear evidence and make recommendations to the court.

Floyd Superior Judge Maria Granger presides over a commercial court in New Albany. She said no cases had been filed in the first six weeks, but with jurisdiction statewide over the docket, she expects to be hearing cases soon. She said the commercial courts have the aid of four clerks who will help expedite rulings and keep cases moving. “We want a fast, reliable solution with predictable outcomes,” Granger said.

New court, new rules

When Indiana became the 23rd state with commercial courts, the Supreme Court set out the rules in order 94S00-1601-MS-31. The dockets are limited to cases involving formation, governance or dissolution of businesses; rights and obligations of owners, shareholders, directors, partners or members; trade secret and non-compete agreements; and other contractual disputes spelled out in the rule.

Lawyers filing these cases by rule must file a notice identifying a commercial court docket case with the clerk. These courts stress mutuality and cooperation between counsel, but Welch noted the consent of an opposing party is assumed when a case is filed. A party who doesn’t want his or her case heard in commercial court must object within 30 days after being notified in order to opt out.

“It’s not a trap,” Welch said, and she encouraged parties who agree to commercial court docketing to file statements consenting to the venue early to expedite the case. Kay Dee Baird, a Krieg DeVault LLP senior associate who handles complex banking litigation and listened to Welch’s presentation, said it might come as a surprise to some attorneys that the consent of both parties is required.

Because the pilot will be measuring results only with cases originating on its docket, Welsh said no cases filed before June 1 are eligible to be heard by the six judges.

Slow to start

Like Granger, Lake Superior Judge John Sedia, who presides over the commercial court in Crown Point, hasn’t received any commercial court filings in the first six weeks. Whether the pilot succeeds will be based on whether lawyers use it, he said.

“We’re going to see how it works,” Sedia said. The pilot might not become permanent “if it doesn’t generate the interest in the business community that the movers and shakers thought. … We’re hoping it catches on and becomes a viable part of the law in this state.”

Granger said the program gives lawyers extensive control over cases. “Any one of the six commercial court pilot locations would be able to make decisions in those cases,” she said, no matter where the controversy arises. “I think attorneys will be looking at venue rules, and we left it (venue location) open so they could do what’s best for their case.”

Sedia used the example of a business in Richmond with a suit that qualified as a commercial court case. The client could choose to file in Granger’s court in New Albany, Welch’s court in Indianapolis, or in Allen Superior Judge Craig Bobay’s court in Fort Wayne. The business could even choose to file in Sedia’s court in Lake County if it desired.

Voluntary, for now

An objective of the pilot project is to establish a reliable and predictable body of business case law for the state, which some lawyers said Indiana lacks. Welch said in establishing the courts, the Supreme Court followed the longstanding practice of making participation optional, but she told lawyers that could change in the future. The working group found only one state that offered a commercial court pilot program but didn’t later make it permanent. She said if Indiana’s pilot is extended beyond three years, it likely would cease to be voluntary.

Granger agreed that whether the venues fulfill their mission is up to business litigators. “I would encourage those attorneys who have commercial court-eligible cases to consider utilizing the program,” she said. “I think they’re going to be able to realize benefits.”

Welsh said once decisions of the commercial courts are issued, the intention is to post those opinions on a designated website. These opinions won’t be binding authority, she said, but they will give lawyers a sense of how the courts are ruling on particular matters.

The format of the court — stressing efficiency and quicker resolution of cases — also can help lawyers with what’s often a key consideration, she said.

“It also helps you determine, how much does your client want to put into this case?”•