The Colorado Supreme Court has reversed an Appellate Division ruling that found there is a “strong presumption” that general partnership are not, in fact, investment contracts.

According to the opinion, HEI Resources Inc. and the Heartland Development Corp. “formed, capitalized and operated” eight ventures in the exploration and drilling of oil and gas wells. Through Los Ojuelos Joint Ventures, they cold called potential investors, mailed promotional materials on the ventures including risk advisement materials. People who joined became part of a general partnership under the Texas Revised Partnership Act and signed a joint venture agreement. The ventures were never registered as securities, no were they registered as exempt.