Highland Homes Ltd. v. State, 2013 WL 9600949

Rule 42(a) authorizes class actions with court-approved representatives and notice for absent members.
Highland Homes deducted subcontractors’ pay for insurance; Benny & Benny and Polendo sued on behalf of a class of ~1,800+ subcontractors.
Class certified under Rule 42(b)(3); settlement terms were reached pending court review and notice to a class of 1,849.
Settlement provided refunds to settled class members, with uncashed/remainder funds to be cy pres awarded to The Nature Conservancy.
State intervened, arguing under Texans Unclaimed Property Act (UPA) that cy pres and a 90-day check-negotiation window violated the UPA.
Trial court approved the settlement; court of appeals reversed, holding that UPA bars the cy pres award and the 90-day limit.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does the Unclaimed Property Act apply to the cy pres award?	Highland Homes	State of Texas	UPA does not apply to the cy pres award under these facts
Whether absent class members’ claims were abandoned property despite Rule 42 representations	Highland Homes	State of Texas	Absent members’ claims were asserted through class representatives; not abandoned
Whether a 90-day deadline for negotiating settlement checks violates the UPA	Highland Homes	State of Texas	90-day limit does not trigger abandonment because claims were asserted via class representatives

Connecticut Mutual Life Ins. Co. v. Moore, 333 U.S. 541 (1948) (UPA principles; private escheat and ownership protections)
Klier v. Elf Atochem N. Am., Inc., 658 F.3d 468 (5th Cir.2011) (cy pres appropriateness in needing surplus funds)
All Plaintiffs v. All Defendants, 645 F.3d 329 (5th Cir.2011) (class action settlement considerations and related issues)
In re Lease Oil Antitrust Litig., 570 F.3d 244 (5th Cir.2009) (standing and cy pres challenges in class actions)