The same day that the U.S. Court of Appeals for the Third Circuit issued its opinion as to the validity of New Jersey's 2010 unclaimed property law amendments relating to stored value cards, it also rendered an opinion on American Express's challenge to a separate part of the law that shortened the dormancy period for travelers' checks from 15 years to 3 years. The Court of Appeals determined, as did the district court, that the New Jersey law was presumptively valid.
The key to the court's decision in this case was the application of a "rational basis" standard of review. Under a "rational basis" standard, a court will not invalidate legislation so long as it is in furtherance of some legitimate government purpose. In the Amex case, the court determined that the travelers' check legislation could been seen as furthering the legitimate governmental purpose of making the escheat laws "uniform" by making nearly all dormancy periods 3 years. The court also held that the state could rationally conclude that consumers would be better protected if the state, rather than Amex, were to hold the funds. (This latter point, however, ignores the fact that because most travelers' checks are escheated without name and address info, most consumers will never be able to locate their items on a state database). For those reasons, the Court upheld the law.
By the way, to the extent that this sounds familiar, it is because the U.S. Court of Appeals for the Sixth Circuit ruled earlier this year that Kentucky's decision to shorten that state's travelers' check dormancy period to three years was valid as well. Now that two states have been successful (thus far) other states may follow Kentucky's and New Jersey's lead.