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News & Press: Legal News

Federal Judge Publishes Opinion in Temple-Inland Case

Wednesday, June 29, 2016   (0 Comments)
Posted by: Emily Lee
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Summary provided by Alston & Bird:

In a long-awaited decision, the Delaware federal district court has ruled on the parties’ cross motions for summary judgement in Temple-Inland Inc. v. Cook. In short, the district court handed Temple-Inland a significant win in its ongoing litigation against Delaware challenging the use of estimation in audits. The district court granted Temple-Inland’s motion for summary judgement on its substantive due process claim, because the State:

  • Waited 22 years to audit [Temple-Inland];
  • Exploited loopholes in the statute of limitations;
  • Never properly notified holders regarding the need to maintain unclaimed property records longer than is standard;
  • Failed to articulate any legitimate state interest in retroactively applying Section 1155 [the statute authorizing estimation] except to raise revenue;
  • Employed a method of estimation where characteristics that favored liability were replicated across the whole, but characteristics that reduced liability were ignored; and
  • Subjected plaintiff to multiple liability. 

Thus, the court stated that, “[t]o put the matter gently, defendants have engaged in a game of ‘gotcha’ that shocks the conscience.” 


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