© 2012 smith moore leatherwood llp. all rights reserved. a primer on the north carolina business...

© 2012 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED.

A Primer on the North Carolina Business Court

Presented by:Fred Wood, Jon Heyl and Heather White

Smith Moore Leatherwood LLP525 N. Tryon St., Suite 1400

Charlotte, NC 28202(704) 384-2600


History and Philosophy

• Why have a Business Court?– In April 1994, Governor Hunt established the North

Carolina Commission on Business Laws and Economy (“Commission”)

• Mission: recommend “any needed changes in existing statutes and regulations which affect the operation of businesses in North Carolina.”

– In January 1995, the Commission issued a report recommending that North Carolina establish a business court.



• Why have a Business Court?– Look at Delaware

• “Many national corporations incorporate in the state of Delaware because of that state’s Chancery Court which provides a high level of judicial expertise on corporate law issues.” Rule 2.2. cmt.

– Business Development• Business entities want to operate in a state having

a “substantial body of corporate law that provides predictability for business decision making.” Id.



• Formed in 1995.

• Judge Ben F. Tennille was appointed as the first and only judge at that time.

• The first court was located in Greensboro, NC.

• In 2005, additional judges and courts were added.

– Raleigh – Judge John R. Jolly, Jr.

– Charlotte – Judge Albert Diaz

• Current sitting judges:

– Raleigh – Judge John R. Jolly, Jr.

– Greensboro – Judge James L. Gale

– Charlotte – Judge Calvin E. Murphy


Why You Want Your Cases Heard in the North Carolina Business Court• Experienced judges with expertise in complex business

litigation.– Prior private practice experience– Only hear “complex business cases” unlike other

state court judges. • Well-reasoned and thoughtful decisions.

– Each judge has two law clerks.– Judges are required to write opinions.

• Same judge throughout life of case.


Why You Want Your Cases Heard in the North Carolina Business Court• Electronic filing and case management system.

– Cost savings.– Easy access – similar to federal court system.– Technology enhanced courtrooms.

• Local rules are modeled after federal rules.– Practice and procedure is more analogous to federal

court, not North Carolina state court. – Case management procedures – provide for more

efficient and less costly disposition of cases.


What types of cases qualify for the North Carolina Business Court?• N.C. Gen. Stat. § 7A-45.4

– (1) law governing corporations, limited liability companies, partnerships, limited liability partnerships

– (2) securities law– (3) antitrust law– (4) state trademark and unfair competition law– (5) intellectual property law– (6) the Internet, electronic commerce, biotechnology– (7) certain areas of tax law


What types of cases qualify for the North Carolina Business Court?• Rules 2.1 and 2.2

– If you case does not qualify under N.C. Gen. Stat. § 7A-45.4, you may still get in to the Business Court based on Rules 2.1 and 2.2.

– Must make motion in county of venue and receive recommendation from senior resident superior court judge or presiding judge.

– Recommendation must be approved by Chief Justice and Administrative Office of the Courts.

– Currently, approval is rarely granted.


How to get cases in to the North Carolina Business Court

• Similar to federal court removal• File a “notice of designation” (i.e., similar to a notice of

removal).– Plaintiffs: Must file contemporaneously with the

Complaint.– Defendants: Must file within 30 days of service of the

Complaint.– Amended Pleadings: May allow you to remove case

to Business Court at a later date if the amendment “substantially alters the nature of the action.”

• Filing fee: $1,000.


Recent Notable Decisions from the North Carolina Business Court• Blythe v. Bell• Elliot v. KB Home• Outdoor Lighting• Associated Packing v. Jackson Paper• Tong v. Dunn


Questions

© 2012 smith moore leatherwood llp. all rights reserved. a primer on the north carolina business...

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