USA – OKLAHOMA Trends and Developments Contributed by: David Elder, Erin O’Roke Oakley, Michael Whaley and Austin Dodd, Hartzog Conger Cason
A system under strain Oklahoma’s district court system is under visible and increasing strain. While Oklahoma’s district courts are staffed by capable and dedicated judges who han- dle a broad array of cases with professionalism, even the most experienced judges are constrained by a court system that is chronically under-resourced and increasingly overburdened. In Oklahoma’s most populous counties, including Oklahoma County and Tulsa County, civil litigants face months-long delays to schedule a hearing and it can be years before complex civil cases get to trial. Cases involving shareholder and corporate governance dis- putes, high-value contract disputes, business torts, and other complex matters must compete for time within district courts of general jurisdiction, which hear all types of cases both in the civil as well as the crimi- nal realm. Increasingly, litigants in civil matters − espe- cially those involved in complex commercial disputes − face mounting delays and inconsistent results. For litigants, delay and inconsistency entail real costs: uncertainty, prolonged risk exposure, delayed recov- eries, and increased litigation costs. The reasons are largely structural, as follows. • Heavy caseloads − with more than 120,000 new court cases filed annually in Oklahoma County alone, district court judges are often responsible for thousands of cases across a wide array of subjects. • Lack of support − unlike federal courts or courts in some other states (or even the business courts as proposed in SB 632), Oklahoma district judges do not have law clerks or staff attorneys to assist with legal research and case management. This, of course, places an enormous burden on judges, who may hear 20 or more motions on a civil motion docket. • Budgetary constraints − judicial compensation in Oklahoma remains low. Oklahoma currently ranks 48th in the nation and last in the region when it comes to judicial compensation, making it difficult to attract and retain experienced judges. With stag- nating pay, the number of applicants for judicial vacancies has fallen by roughly two-thirds.
• No structural fast-track for business disputes – unlike jurisdictions with specialised courts (eg, Delaware and Texas) (and as SB 632 attempted to do), Oklahoma has no mechanism to expedite or prioritise complex business litigation. Nor is there any guarantee that an assigned district judge will have prior business law experience that could help ensure consistency of results. The result of these systemic problems is a litigation environment that lacks speed, consistency, and pre- dictability − all of which are essential to businesses considering Oklahoma as a place to invest in, operate, and resolve disputes. The legislative response: SB 632 – a case study in judicial reform The Oklahoma Legislature sought to address some of these issues with the creation of a business court. The legislature authorised the Oklahoma Supreme Court to create a business court division more than 20 years ago. After decades of inaction, however, the Oklahoma Legislature took matters into its own hands, creating a task force to study the implementa- tion and effect of a business court. SB 632 was the result of that study. It established business court divi- sions in Oklahoma’s two most populous counties and granted those courts jurisdiction to hear “complex” commercial disputes where the amount in controversy exceeded USD500,000. It also granted the business courts jurisdiction over cases seeking equitable relief under various state statutory schemes, including Oklahoma’s version of the Uniform Commercial Code and the General Corporation Act, among others (see 20 OS Section 91 7c). The legislation sought to ensure that business court judges would have subject-matter expertise in busi- ness law, as well as greater resources than are cur- rently available in the district courts. By way of exam- ple, rather than the two years of experience in legal practice required for associate district judges, SB 632 required ten years of experience in complex civil business litigation, business transactional law, or civil judicial (or judicial clerk) service. The legislation also provided that business judges would receive a higher salary (comparable to an Oklahoma Supreme Court justice) and have the funding to hire a law clerk. Addi-
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