Hangley Aronchick secured a victory upholding the constitutionality of Pennsylvania’s law governing the state’s possession of unclaimed or abandoned property.
Shareholders John Summers and Matthew Hamermesh, and associate Eitan Kagedan represented state Treasurer Stacy L. Garrity in a federal class action lawsuit, which claimed that Pennsylvania’s escheatment law violated the Takings Clause of the U.S. Constitution by failing to pay interest to property owners for the time their funds were held by the Commonwealth.
The team successfully argued that the state’s retention of abandoned property during the statutorily-defined period did not qualify as a taking that requires compensation from the state. In a 13-page memorandum opinion, U.S. Judge R. Barclay Surrick of the Eastern District of Pennsylvania cited similar applications of the U.S. Supreme Court’s 1982 decision in Texaco v. Short in holding that Pennsylvania is not obligated to compensate owners for their own neglect in allowing their property rights to lapse.
Read the May 3 opinion here.
