$109 Million Settlement Resolves Minnesota Property Forfeiture Class Action Lawsuit

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Minnesota has agreed to pay a $109 million settlement to resolve a proposed class action lawsuit that alleged its counties unconstitutionally retained excess proceeds from the sale of tax-forfeited properties.

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The Minnesota property forfeiture settlement will compensate anyone who held any ownership interest, including a valid lien or other security interest, in an eligible property forfeited to the state for unpaid property taxes during the following time periods:

• Properties in Hennepin County forfeited between August 16, 2012 and December 31, 2023;

• Properties in St. Louis County forfeited between June 2, 2016 and December 31, 2023; and
• Properties in all other Minnesota counties forfeited between June 23, 2016 and December 31, 2023.

The official website for the deal can be found at MNTaxForfeitureSettlement.com.

Eligible properties must have a “surplus value,” meaning their value exceeds the total delinquent taxes, interest, penalties, fees, special assessments and costs associated with the property.

According to the settlement website, class members may include property owners, heirs of owners, personal representatives, corporations, LLCs, lienholders and others. 

To receive a Minnesota property forfeiture settlement payout, class members must submit a valid claim form online or by mail by June 6, 2025.

Click here to file a claim form online. You will need to provide a class member ID, which can be found in the settlement notice you may have received. Fill out this registration form if you did not receive notice with a class member ID.

You can also download a PDF claim form to print and submit by mail.

Individuals whose claims are approved are eligible to receive up to 90 percent of the surplus value of the forfeited property, plus interest starting from the date of forfeiture. 

“The Surplus Value is the value of the property at the time of forfeiture less taxes and associated charges owed,” the site says.

If more than one valid claim is filed for an eligible property, the surplus value for that property will be allocated among the class members based upon their order of priority under Minnesota law.

Former owners of severed mineral rights will receive $300 per parcel, plus interest. 

Former lienholders will receive a settlement payment up to the amount of the lien value as of the date of forfeiture, plus interest, based upon the unpaid amount of the lien, the surplus value and the amount of other valid lien or ownership claims as determined under the settlement.

Payments may be reduced proportionately, depending on the total number of valid claims submitted.

A Ramsey County District Court judge granted final approval to the terms of the settlement on December 16, 2024, resolving claims initially brought by a Minnesotan who alleged her constitutional rights were violated when Hennepin County sold her forfeited condominium for more than she owed in taxes and retained the surplus. The case, Tyler v. Hennepin County, claimed the county sold the woman’s property for $40,000. Despite her outstanding delinquent property taxes totaling only $15,000, the woman says she never saw the $25,000 difference.

The class action suit made its way to the U.S. Supreme Court, which ruled in 2023 that Minnesota’s tax forfeiture system was unconstitutional. The state has since drafted prospective legislation to constitutionalize the system. If signed into law, the bill would require counties to notify individuals that they can file a claim to receive any excess proceeds from the sale of their tax-forfeited property.

Did you know that some class action settlements require no proof to submit a claim? Check out the latest open class action settlements.