In In re Beard, issued October 15, 2026, the Fifteenth Court of Appeals gave an important answer about the scope of Texas Business Court jurisdiction: An action “arises out of” a qualified transaction when the transaction is a but-for cause of the litigation. That interpretation gives the Business Court potentially broad jurisdiction over disputes connected to significant transactions, including claims brought by individuals who weren't parties to the underlying deal.

The plaintiff alleged that his former employer promised to pay him the value of an equity interest when it sold its stake in a portfolio company. After the sale occurred and the plaintiff didn't receive the payment, he sued for fraud, promissory estoppel, and breach of contract, among other claims. The defendants removed the suit to the Business Court based on the sale, which qualified as a transaction exceeding the statute’s $5 million threshold. The plaintiff moved to remand, which the Business Court denied.

On mandamus review, the plaintiff argued that his claims arose from earlier employment and separation agreements – not the later sale. But the Fifteenth Court saw no need to choose only one source. Because the sale triggered the alleged payment obligation, the litigation couldn't have occurred without it. That was enough to confirm jurisdiction.

Just as important, the plaintiff was neither a party to the sale nor a business. Even so, the Fifteenth Court held that neither fact defeated jurisdiction. The statute requires only that “a party” to the qualified transaction pay, receive, or become obligated to pay or receive at least $5 million. It doesn't require every litigant to have participated in the deal, and it doesn't limit the Business Court to disputes between large businesses.

Justice Farris's opinion also offers a broader lesson about litigating jurisdiction in this relatively new court system. The plaintiff relied on Senate floor statements describing the Business Court as a forum for “high stakes commercial cases” between “big businesses.” The court quickly waved those statements away. Individual legislators’ comments couldn't override the statute’s plain text, which contains no business-only or privity requirement.

That textualist approach may prove as consequential as the jurisdictional holding itself. Parties addressing novel questions under the Business Court statute should begin with the enacted language, read against existing Texas precedent. General statements about why the Legislature created the court will carry little weight when the statutory text points elsewhere.

Key Takeaways

• Look beyond the immediate contract. A claim may arise out of a qualified transaction even if the plaintiff’s asserted rights originated in an earlier agreement.
• Deal participation isn't required. Individuals and nonparties to a transaction may still find their claims within Business Court jurisdiction.

• Start with the statute. Legislative history won’t persuade a textualist court to depart from the statute’s plain language.