05/30/2012 03:16 pm ET Updated May 30, 2012

Borders Gift Card Holders Fight To Reclaim Their Money After Bankruptcy Liquidation

Gift cards aren't always a sure bet when it comes to gift giving.

Two Borders gift card holders are learning this the hard way as they fight to redeem old cash from the bookstore chain, which shuttered its doors last year.

The two argue that they should be allowed to request payment for their $125 gift cards, claiming that they were not adequately informed of the need to use or request payment for their gift cards before the store closed, according to the Wall Street Journal.

But Borders is not budging. Curtis R. Smith, the Borders trustee responsible for paying off the store's creditors, said in court papers filed Friday that the gift card holders "squandered" the opportunity to use their gift cards or get paid, according to the WSJ. A Manhattan bankruptcy judge will hear out the case on June 13.

The gift card holders have requested that the bankruptcy court approve their lawsuit as a class action suit, according to their attorneys. The request says that there are "likely thousands of gift card claims" that are probably worth $100 or less, and that it would be impractical and time-consuming for bankruptcy courts to consider these claims separately.

Attorneys claim that Borders wiped out $156 million in unspent gift cards on September 22, 2011 before the holiday shopping season, according to the Chicago Daily Law Bulletin. But the move didn't come close to closing the store's budget shortfall. Borders has five times more in liabilities than it has in assets. This lawsuit is trying to get Borders to pay gift card holders before they pay back other creditors.

This story is just one more indicator that gift cards are never a sure bet. Sometimes writing a check might be a more reliable way to give someone the gift of cash.

In New Jersey, some shoppers were shocked to learn that their gift cards could expire against their will. Under a new state law, the New Jersey state government will collect the proceeds from all gift cards that have not been used for two years.

As a result, American Express has pulled its gift cards from New Jersey stores. Blackhawk Network and InComm, the companies behind hundreds of name-brand gift cards, also have pulled out of the state.