The reform of the division between complex and simple cases is a key measure for advancing the rule of law and promoting the modernization of the national governance system and governance capacity. This paper uses the pilot reform of the division between complex and simple cases as a natural experiment to examine the impact of the reform on corporate innovation and its underlying mechanisms. The results show that, compared with firms in non-pilot regions, firms in pilot regions experience an approximately 13.72% increase in patent applications following the reform. Mechanism testing reveals that this effect is primarily achieved through the effects of cost saving, supply chain dependency relief, and market expectation. Heterogeneity analysis shows that the effect of the reform on corporate innovation is stronger for firms with a higher level of data assetization, those with a lower level of trade credit, and those operating in industries with more intense market competition. Further analysis shows that the reform enhances the breakthrough innovation capability and efficiency of firms. This paper extends the research on the economic consequences of the reform and provides intellectual support and policy insights for promoting innovation-driven development strategies from the perspective of enhancing judicial efficiency.