The Texas Business Court's First Division has ruled that a Rule 202 petition to take a pre-suit deposition qualifies as a removable "action" under the court's governing statute, opening the door for pre-litigation discovery disputes to be litigated in the Business Court rather than the district court where they were originally filed.

In In re Radical Hoops, Ltd., the court denied an emergency motion to remand a Rule 202 petition that a respondent had removed from district court. The petitioners, entities affiliated with Mark Cuban, had filed the petition seeking pre-suit discovery to investigate potential tortious interference claims arising from a rival arena development deal for the Dallas Mavericks. The respondent removed the proceeding to the Business Court, and the petitioners argued that the court lacked jurisdiction because a Rule 202 petition is not a "lawsuit" and therefore not a removable "action."

The Business Court rejected that argument. Relying on Texas Supreme Court precedent and dictionary definitions, the Business Court held that "action" carries a broader meaning than "lawsuit" and encompasses any judicial proceeding in which a party pursues or enforces a claimed right. Jaster v. Comet II Const., Inc., 438 S.W.3d 556, 563-64 (Tex. 2014). Because a Rule 202 petitioner is doing exactly that, the Business Court concluded the proceeding qualifies as a removable action under Government Code Section 25A.006(d).

The Business Court also addressed its subject matter jurisdiction, finding that the anticipated underlying claims appear to satisfy the Business Court's statutory requirements: the dispute traces to a multi-billion-dollar ownership transaction and a separate option agreement valued above $50 million, and the alleged amount in controversy exceeds the $5 million threshold. The Business Court declined to rule on constitutional ripeness, reserving that issue for the Rule 202 hearing itself.

One open question remains: the respondent indicated it plans to file a motion to compel arbitration, which could redirect the entire controversy before the pre-suit discovery dispute is ever resolved on the merits.

Key Takeaways

• Pre-suit discovery can be addressed by the Business Court. Companies anticipating or facing Rule 202 petitions involving large commercial transactions should evaluate Business Court jurisdiction from the outset, not just when full litigation begins.

• Removal is available. A respondent served with a Rule 202 petition filed in district court may remove that proceeding to the Business Court if the anticipated underlying lawsuit would fall within the court's jurisdiction. That option should be evaluated immediately upon receipt of any such petition.

• Prior Business Court decisions on "action" do not foreclose removal of Rule 202 petitions. The court distinguished earlier rulings from Yadav, Tema Oil & Gas, and Osmose Util. Servs., Inc., each of which arose in different procedural contexts. 

• Constitutional ripeness remains unresolved. The Business Court has not yet ruled on whether this Rule 202 proceeding satisfies constitutional jurisdictional requirements. That ruling, expected at the upcoming hearing, could still affect whether the Business Court proceeds to the merits.

Companies involved in high-value Texas commercial transactions should now treat the Texas Business Court as a potential forum for pre-suit discovery issues, not just for filed lawsuits. Counsel should assess removal rights and Business Court jurisdiction at the earliest stage of any anticipated dispute, including before formal litigation begins.