The U.S. Supreme Court ruled unanimously Tuesday that Delaware wrongfully grabbed hundreds of millions of dollars in unclaimed funds from customers of international payments giant MoneyGram, under the old legal doctrine of escheat.
"Abandoned financial products should escheat (revert) to the state of the creditor's last known address" and not merely to the state where the company that prepared them happens to be incorporated, according to the decision, written by Justice Ketanji Brown Jackson.
The penalty is still being decided. The case could cost Delaware as much as $400 million, according to Pennsylvania State Treasurer Stacy Garrity. That would pressure the state's $5 billion annual budget, and potentially its status as one of just four states that don't impose a retail sales tax.
