Tag: gift cards

Developing: Jury Finds Against Gift-Card Issuer in Delaware Qui Tam Litigation

Delaware ex rel French v. Card Compliant, et al, has been one of the most closely-watched unclaimed property cases in recent memory.  The case involves a whistleblower claim by a former executive of a so-called “GiftCo” structuring entity, alleging that the “giftco” structure (whereby a company issues gift cards through a subsdiary incorporated in a state that exempts gift cards from the scope of unclaimed property laws) amounts to an improper avoidance of Delaware’s escheat laws.

According to a press release issued by the Plaintiff’s attorneys, the jury unanimously found that the card issuer violated Delaware law by using a “giftco” structure to circumvent the state’s escheat laws.  More information when it becomes available.

On Second (or Third) Thought, Nevermind — NJ Eliminates Gift Card Data Collection Requirement

Perhaps we can now tie a bow on the long-running New Jersey gift card saga.  First, a brief refresher:

In 2012, Governor Christie signed Senate Bill 1928 into law, which revised New Jersey’s 2010 gift card legislation.  Briefly, the bill extended the dormancy period for gift cards from 2 years to 5 years, and delayed implementation of a requirement that retailers obtain zip code information at the point of sale for 4 years.  While many gift card issuers applauded the amendments, not everyone was happy.  In particular,  the some holders and gift card issuers favored legislation that would remove gift cards from the New Jersey unclaimed property act entirely or, at least, to eliminate the zip code collection requirement.  As a NJ BIZ article recounts, however, repealing legislation got watered down on the State House floor.

After more than 2 years of legislative wrangling, the issuer and holder communities got (at least part of) what they were looking for.  On February 5, Governor Christie signed Senate Bill 2235 into law.  The law eliminates the provision of the New Jersey Unclaimed Property Act previously scheduled to come into force in 2016, requiring card sellers to obtain zip code information at the point of sale.

Friday Lost + Found: Texas Gift Cards, Wisconsin Auction, Delaware Followup

Texas Announces $12M in Unclaimed Gift Cards Available — NBC 5 (Dallas/Fort Worth) is reporting that the Texas State Controller’s office has about $12 million in abandoned gift cards awaiting reclaim at state offices.  The article even has a document from the Controller’s office indicating the businesses that have reported such funds.

Wisconsin Dept. of Revenue Unclaimed Property Auction — People deposit all kinds of stuff in safe deposit boxes — jewelry, stamps, coins, collectibles — and sometimes they abandon them.  That stuff eventually makes its way to state unclaimed property offices.  But what does the state do with those items?  In some cases, the answer is auction the items to the public.  The Wisconsin Department of Revenue is currently running an online auction until January 20.  Items can be viewed and bid upon online.

Delaware Legislation Proposed With Task Force RecommendationsOur last post talked about the recommendations of the Delaware Abandoned Property Task Force and wondered aloud if any action would be taken in response to the group’s recommendations.  Recently, Senate Bill 11 was proposed in the legislature, which would adopt some of the Task Force’s recommendations.