Federal Court Vacated Ruling on Unclaimed Michigan Accounts

An appellate court ruled that Michigan does not take ownership of presumptively abandoned property.

Updated on Oct. 5, 2026 in Saving

Isometric editorial illustration of a metallic vault door and a golden key on a plinth, representing protected financial property rights. — A federal appellate court ruled that Michigan cannot assume ownership of unclaimed financial accounts, affirming the property rights of original owners. AI Illustration. Upload story photo >

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Should owners retain full legal rights to their property after the state takes custody of it?

A federal appellate court has vacated a district court judgment that originally dismissed a due-process lawsuit brought by Dennis O'Connor. The ruling affirms that original owners retain ownership of financial accounts even after Michigan takes state custody.

Why it matters

The decision clarifies the legal status of unclaimed property, preventing states from assuming full ownership of accounts turned over by private companies. This ruling ensures that individuals maintain property rights despite the state transferring funds into its general fund.

Dennis O'Connor held two separate financial accounts, with one valued between $100 and $250 and another valued at less than $100. Both accounts were transferred to the state by private companies after contact with the owner was lost.

The players

Dennis O'Connor

He is the plaintiff who initiated the lawsuit against the state of Michigan regarding the handling of his unclaimed financial accounts.

Michigan

This state government agency took custody of unclaimed financial accounts under the Uniform Unclaimed Property Act.

The details

The appellate court determined that the lower court erred by concluding the state effectively took ownership of the account principals. The case has now been remanded to the district court to address the original due-process claims involving Michigan and two state officials.

October 29, 2024: The Kemerer v. State decision was issued by the Michigan Court of Appeals.
2025: An appeal of the Kemerer v. State decision was denied.
October 4, 2026: The federal appellate court vacated the district court dismissal.

Market Dynamics

This ruling significantly constrains how states interact with assets under the Uniform Unclaimed Property Act. By affirming that state custody is not equivalent to property ownership, the court forces a re-evaluation of state fiscal practices regarding unclaimed funds.

This decision protects retail account holders by ensuring their assets remain their legal property even after state intervention. It strengthens the ability of individuals to reclaim funds that were previously deposited into state general funds.

The takeaway

Property owners should remain aware of their financial assets even if contact with a service provider is lost. This ruling confirms that legal ownership of abandoned funds persists despite state administrative actions.