Judge won’t block Ohio’s plan for new Cleveland Browns stadium, won’t dismiss case against it either
A federal judge is allowing a case to proceed challenging Ohio’s plan to fund a new Cleveland Browns stadium with residents’ unclaimed funds. Attorneys for the state had asked the judge to dismiss the case; plaintiffs wanted to halt any transfer of money out of the unclaimed funds trust fund.
U.S. District Judge Edmund Sargus declined to do either. But Jeff Crossman, an attorney representing the citizens challenging the state doesn’t see it as a draw.
“I think the judge is convinced there’s some smoke here, and there might actually be some fire as well,” he said, “and that’s why he’s letting the case proceed.”
Crossman remains optimistic about their case and said they’re still considering an appeal to halt the transfers set to begin Jan. 1, 2026.
The claims
State officials urged the court to scrap the case, insisting the plaintiffs, who have property in the unclaimed funds trust fund, lack standing and have suffered no injury.
Rather than sue the state, the argument goes, the plaintiffs should just claim their property.
What’s more, the proposed transfers haven’t even started, and rightful owners will have a ten-year grace period to reclaim their money after they do.
Sargus batted those arguments away.
He pointed to a Supreme Court case out of Pennsylvania known as Knick.
“There,” he wrote, “the Supreme Court held that plaintiffs need not exhaust state remedies to have an ‘actionable’ takings claim in federal court.”
He added subsequent lawsuits have applied the Knick decision to unclaimed funds cases, allowing plaintiffs to go forward “even if they had not pursued state law remedies for recovering unclaimed funds first.”
The state next argued the court should abstain because the dispute is a state issue and it should get hashed out in state courts. But the judge disagreed. The state statutes in question aren’t ambiguous or overly complicated and federal courts have ruled on similar cases before.
“Plaintiffs contend that these provisions violate the Takings Clause and the Due Process Clause of the United States Constitution, which are federal issues that Ohio’s administrative process would not resolve,” Sargus wrote.
On the other hand, the judge determined the avenues available for reclaiming funds — filing a claim prior to transfer, or within the ten-year grace period, or by appealing to the Ohio Court of Claims — make it impossible to justify blocking the state’s plans.
One element of obtaining an injunction is demonstrating you’d suffer “irreparable harm” without court intervention.
“Here, plaintiffs cannot establish that they will suffer irreparable harm without an injunction,” Sargus wrote, “because monetary damages are available to compensate plaintiffs for any alleged violation of the Takings Clause.”
What’s next
Crossman’s case makes two central arguments.
First, it’s unconstitutional to take Ohioans’ money and hand it to a private organization like the Cleveland Browns without just compensation, and second, it’s unconstitutional to do so without providing prior notice.
“The state admitted this on the stand repeatedly,” he said. “They do not send any notice to any specific purpose. They do these generalized campaigns to make people generally aware to check on unclaimed funds.”
The stadium funding plan converts Ohio’s unclaimed funds program from one that holds residents’ assets in perpetuity to a fund that eventually flows into state coffers. To Crossman, that’s embezzlement, just slower.
“What incentive does the state have to notify you at all?” he asked. “It’s an immediate conflict of interest between you and the state of Ohio. Imagine if your stockbroker, holding your stock, had no incentive to make sure you actually got your money.”
Ohio Capital Journal reached out to attorneys representing state officials in the case, but they declined comment.
Unless Crossman’s team successfully appeals for an injunction at a higher court, the state will begin moving funds out of the unclaimed funds trust fund on Jan. 1.
That portion, made up of assets that have been in the fund for at least 10 years, is worth between $1.7 and $1.9 billion.
State lawmakers have actually appropriated $1 billion of that total — $600 million for the Browns stadium and the rest for “other qualifying projects.”
Lawmakers’ underlying motive for tapping unclaimed funds was that they could pay for the stadium without using taxpayer money.
But Crossman said that’s misguided.
“That $600 million, if that was an improper purpose, an improper taking for that purpose, then the state’s going to have to reimburse the trust account for the money it took out,” he said. “And you know, where does that money come from? It comes from you and me, right? It comes from the taxpayers.”
Follow Ohio Capital Journal Reporter Nick Evans on X or on Bluesky.
Ohio Capital Journal is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Ohio Capital Journal maintains editorial independence. Contact Editor David Dewitt for questions: info@ohiocapitaljournal.com.