Partial Removal to Business Court Rejected: 'Action' Means Entire Lawsuit, Not Individual Claims
Read the Court's Opinion (PDF)
Judge Andrea K. Bouressa
In Osmose Utilities Services, Inc. v. Navarro County Electric Cooperative, the Business Court granted remand, holding that removal under Chapter 25A means removal of an entire lawsuit, not individual crossclaims or counterclaims, and that the underlying suit's September 2022 commencement date independently foreclosed jurisdiction. The decision clarifies that actions commenced before September 1, 2024 remain outside the Business Court's temporal jurisdiction regardless of when new claims are asserted within those actions.
Court Staff Summary
Granting a motion for remand, the Court holds: (1) removal of an action to the Business Court means removal of the entire suit, and (2) regardless of whether an attempted partial removal presents a jurisdictional defect, the 2022 commencement date of the underlying lawsuit forecloses jurisdiction over the action by the Business Court.
Background: Crossclaims in a 2022 Personal Injury Suit
The dispute arose from a September 2022 personal injury lawsuit filed by Eddie Martin in Ellis County against multiple defendants, including Navarro County Electric Cooperative, Inc. (NCEC), for severe injuries due to electrocution. Martin later added Osmose Utilities Services, Inc. as a defendant. After NCEC settled with Martin in September 2024, Osmose filed a crossclaim against NCEC on October 16, 2024, seeking declaratory relief and contractual indemnification pursuant to a General Services Agreement between the co-defendants. NCEC responded two days later with a counterclaim against Osmose, also seeking declaratory relief and alleging breach of the GSA and a subsequent pole inspection agreement. On November 4, 2024, Osmose attempted a partial removal to the Business Court of only NCEC's counterclaim and Osmose's crossclaim, leaving the underlying personal injury action in state district court.
The Jurisdictional Question: Can Individual Claims Be Removed?
NCEC moved for remand on numerous grounds, challenging both the propriety of partial removal and the Business Court's temporal jurisdiction over a suit commenced in 2022. The Court's opinion addressed two dispositive issues, holding that removal of an action to the Business Court means removal of the entire suit, and that the 2022 commencement date of the underlying lawsuit foreclosed jurisdiction over the action by the Business Court. The Court did not reach several other issues raised by NCEC.
The Court's Holdings
The Court held that removal under Chapter 25A means removal of the entire suit, not individual claims within a suit. The opinion noted that partial removal presents questions about whether it is permissible under the Government Code's provisions governing the Business Court.
Independently and alternatively, the Court held that the underlying lawsuit's September 2022 commencement date foreclosed jurisdiction. The Texas Business Court was created September 1, 2024, and its governing law applies to civil actions commenced on or after September 1, 2024. Citing its prior decisions in Energy Transfer LP v. Culberson Midstream LLC and Jorrie v. Charles, the Court reiterated that it has held repeatedly that it lacks jurisdiction or authority to hear actions commenced before September 1, 2024.
Implications for Business Court Practice
The decision provides important guidance on two threshold issues for Business Court removal practice. First, it establishes that attempted partial removals—removing only certain claims or counterclaims from a larger lawsuit—are not permissible under Chapter 25A. Second, it confirms that the temporal jurisdiction limitation is absolute: cases filed before September 1, 2024 cannot be brought within the Business Court's jurisdiction through the assertion of new claims after that date. The Court ordered the action remanded back to the district court.