Delaware v. Pennsylvania

On February 28, 2023, the U.S. Supreme Court decided Delaware v. Pennsylvania, an original jurisdiction case concerning the custody of unclaimed MoneyGram official checks worth hundreds of millions of dollars. Delaware claimed the funds under the Disposition of Abandoned Money Orders and Traveler’s Checks Act, arguing they should escheat to the company’s state of incorporation, Delaware. Pennsylvania, Wisconsin, and other states asserted the checks should go to the state of purchase. In a unanimous decision authored by Justice Ketanji Brown Jackson, the Court held that MoneyGram’s official checks qualify as “similar written instruments” under the Act and that the statutory text unambiguously directs escheatment to the state where the check was purchased. The ruling rejected Delaware’s interpretation and directed the transfer of disputed funds to the plaintiff states where the checks were sold.

The Supreme Court unanimously ruled in favor of Pennsylvania and Wisconsin, holding that MoneyGram official checks fall under the Act and must escheat to the state of purchase. Delaware’s claim was rejected.

Whether MoneyGram official checks are covered as “money orders” or “similar written instruments” under the Disposition of Abandoned Money Orders and Traveler’s Checks Act, and whether unclaimed funds must escheat to the state where the check was purchased or to the company’s state of incorporation.

The decision resolved a multibillion-dollar conflict among the states, clarified federal unclaimed property law, and curtailed Delaware’s long-standing practice of claiming abandoned checks based on incorporation. It strengthened the rights of consumer-purchase states and provided uniform guidance on the escheatment of similar negotiable instruments.