The legal battle of whether investments in life settlements are classified as securities continues. Recently, Trinity Settlement Services, a life settlement brokerage firm, has filed a petition at the Texas Supreme Court level. Trinity filed the petition following the dismissal of a lawsuit against the Texas State Securities Board in trial court and the decision by the Court of Appeals to affirm the judgment. Trinity sued the Securities board and the Commissioner hoping to get a declaratory judgment that the Securities Board did not have statutory authority when they filed an enforcement action and that particular investments that Trinity sells do not fit into the securities definition of the Texas Securities Act. Trinity claims that deeming the investments in life settlements as securities is ad hoc rule-making which is prohibited.
See Stephen C. Baker, Katherine Villanueva, Nolan B. Tully, and Thomas L. Mueller United States: Texas Supreme Court Petitioned To Review Allegedly Improper Characterization of Life Settlements As Securities, Mondaq, Nov. 26, 2013.
