Deadline looms in Minnesota property tax forfeiture lawsuit

While she accepted that the government was entitled to the back taxes, Tyler argued that the excess $25,000 from the sale belonged to her.

The nation’s highest court unanimously agreed — declaring that the government violated the U.S. Constitution by keeping more than it was owed.

Attorneys raise awareness

With a June 6 deadline to file class-action claims approaching, case attorneys Vildan Teske and Garrett Blanchfield spoke with HousingWire about efforts to make those affected aware of the payout.

As many as 15,000 people across Minnesota may qualify for restitution if they lost a home, business or other property due to tax forfeitures between 2012 and 2023.

More than 6,000 properties statewide have already been identified as potentially eligible.

“Kroll, which is the claims administrator, mailed out and emailed notice to the potential class members starting in September of 2024 and has done several mailings since then,” Teske said.

“But we also know that this is a difficult population to find, because they’ve moved several times and, by definition, they are no longer at the address that was given to us by the counties, which is their property address that was forfeited.

“So we are doing everything that we can to get the word out so that, in case the mailed notice didn’t get to them, that they would hear about the settlement and put in their claim.”

Teske and Blanchfield urged claimants to file online for the sake of processing speed.

The $109 million fund will provide payouts to affected property owners or their heirs, in cases involving deceased individuals.

Class-action claims can be submitted here.

Disproportionate impact

Many of those impacted are elderly or on fixed incomes, and advocates say this settlement may offer long-overdue justice.

“The people who lost their houses often can’t really afford to lose their houses,” Blanchfield said. “They don’t have a lot of money, and the house — the money, the equity that they have in the house — is likely their biggest asset.

“This really has a disproportionate effect upon the people that it happens to, and that’s why we’re so eager to try and get the money back to these folks. For a lot of them, they lost their greatest financial asset. For some of these people, the recovery will be in the six figures. That’s not the average, but it’s what’s there for some.”

Since the Supreme Court decision, other states have begun revisiting their tax forfeiture laws to prevent similar constitutional violations.

“There’s over a dozen other states that have had similar statutes to the Minnesota statute, so it’s the minority of states, but still a substantial number of people that are impacted,” Teske said. “The rest of the states had statutes that allowed the homeowner to get the surplus value back.”

Claimants deemed eligible for a payout will be able to receive up to 90% of the surplus value from their home sale — plus interest — going back to the forfeiture date, the attorneys said.

“We started mailing out notices more than six months ago, but now we’re in the last month of this of this class period, so this is kind of the home stretch,” Blanchfield said. “When they look at the claim form, if they don’t think they have documentation that they might need, they should still submit a claim, because the important thing is to get a claim submitted before the deadline.

“There will be opportunities after that to submit supplementary documents if the settlement administrator thinks that’s necessary.”