On January 5, 2012, the Third Circuit issued two decisions that affirmed in full District Court decisions granting preliminary injunctions that prevent New Jersey from enforcing two provisions in New Jersey’s recent unclaimed property legislation, 2010 N.J. Laws Chapter 25 (“Chapter 25”) against holders (“Holders”) of unclaimed property, while denying requests for preliminary injunction as to certain other Chapter 25 provisions. New Jersey Retail Merchants Assoc. v. Sidamon-Eristoff, Nos. 10-4551, 10-4552, 10-4553, 10-4714, 10-4715, 10-4716, 11-1141, 11-1164 & 11-1170 (3d Cir., Jan. 5, 2012); Am. Express Travel Related Servs. Co. v. Sidamon Eristoff, No. 10-4328 (3d Cir., Jan. 5, 2012).

New Jersey Retail Merchants Association has significant implications, since it confirms that only two “priority” rules exist in determining the state to which unclaimed property is to be deposite — the address of the owner (the “First Priority Rule”) and the state of the issuer’s domicile (the “Second Priority Rule”). The Third Circuit rejected New Jersey’s attempt to employ a “Third Priority Rule” based on the state where the transaction takes place, concluding that such a rule would contravene U.S. Supreme Court precedent. Delaware, the state that benefits most from the Second Priority Rule — unclaimed property is the third largest source of Delaware’s revenue — is probably breathing a sigh of relief. Issuers of stored value cards (“SVCs”) redeemable for merchandise or services are likewise relieved — at least with respect to SVCs issued before the date of Chapter 25.