Inspired Healthcare Capital Lawsuit & Bankruptcy Update (February 2026)
In February 2026, Inspired Healthcare Capital (“IHC”) and more than 160 affiliated entities filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of Texas.
According to court filings, IHC reported estimated liabilities between $1 billion and $10 billion. The company has secured debtor-in-possession (DIP) financing and stated that the filing is intended to “preserve and maximize value” while it explores asset sales, recapitalization, and restructuring alternatives.
For investors in IHC private placements, funds, and Delaware Statutary Trust (DST) offerings, the bankruptcy introduces significant uncertainty regarding distributions, asset values, and recovery prospects.
Importantly, investors do not necessarily need to wait for the bankruptcy process to conclude before exploring recovery options.
IHC Bankruptcy vs. FINRA Arbitration: What Investors Should Know
Many investors assume that once a sponsor files Chapter 11, recovery must come solely through the bankruptcy court. That is not always the case.
Chapter 11 Bankruptcy
A Chapter 11 case generally focuses on restructuring the company. Investors may:
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Be treated as unsecured creditors
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Recover only a fraction of their investment
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Wait months or years for resolution
Bankruptcy proceedings primarily address the issuer’s financial obligations — not whether a broker-dealer made an unsuitable recommendation.
FINRA Arbitration Claims Against Broker-Dealers
If your IHC investment was recommended by a brokerage firm, you may have the right to pursue recovery through arbitration with the Financial Industry Regulatory Authority (FINRA).
FINRA arbitration claims are:
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Separate from the bankruptcy case
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Filed against the broker-dealer or financial advisor
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Based on suitability, due diligence failures, misrepresentations, overconcentration, and supervision issues
In many cases, investors pursue FINRA arbitration while the bankruptcy remains ongoing.
This page serves as the central hub for updates on Inspired Healthcare Capital bankruptcy proceedings, lawsuits, investor complaints, regulatory developments, and recovery options. We regularly update this page and link to individual posts addressing specific IHC funds, DST offerings, and related litigation as new information becomes available.
Broker-Dealers Named in Current IHC Claims
The White Law Group is actively representing investors in claims involving IHC investments sold by the following firms, among others:
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Realized Financial
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1031 Securities, Inc.
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Great Point Capital
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Concorde Investment Services, LLC.
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Cabin Securities
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Aurora Securities
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Emerson Equity LLC
Allegations in these cases frequently include unsuitable recommendations, failure to conduct adequate due diligence, overconcentration in illiquid alternative investments, and failure to disclose material risks.
Free Consultation: 888-637-5510
IHC Investments We Are Seeking to Recover
We are pursuing recovery for investors in numerous IHC offerings, including:
DST Properties (select examples):
Appleton DST | Arlington Heights DST | Ashbrook DST | Athens DST | Augusta DST | Carson Valley DST | Chesterfield DST | Delray DST | Dunedin DST | Fort Myers DST | Lake Orion DST | Largo DST | Mequon DST | New Braunfels DST | Pinellas Park DST | Reno DST | Round Rock DST | San Marcos DST | St. Petersburg DST | and others.
IHC Funds:
Inspired Healthcare Capital Income Fund V | Inspired Healthcare Capital Development Fund III | Inspired Healthcare Capital Income Fund V, LLC | Inspired Healthcare Capital Liquidity Fund
For a complete breakdown of each offering, see our individual property and fund pages linked below.
Background: Events Leading to the Bankruptcy
The Chapter 11 filing followed months of financial distress, including:
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Suspension of all investor distributions beginning in July 2025
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Halted new investment offerings
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Replacement of senior management
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Appointment of independent managers
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Retention of restructuring counsel
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Escalating investor claims and litigation
In a February 10, 2026 letter to investors, IHC confirmed the appointment of a Chief Restructuring Officer and disclosed that prior leadership, including Luke Lee, no longer holds a role at the company.
The company has stated it intends to preserve potential claims against “wrongdoers,” though no specific recovery pathway for investors has been outlined.
Regulatory & Litigation Developments
IHC has disclosed that it remains under ongoing SEC regulatory review. As of February 2026, no public enforcement action has been announced, but regulatory investigations often precede further developments.
In addition, litigation filed by Emerson Equity LLC in September 2025 alleged fraud, breach of contract, and material misrepresentations, including claims involving undisclosed guarantees and insolvency concerns. That lawsuit heightened investor scrutiny regarding liquidity and internal controls.
Investor-related litigation activity has also expanded into multiple FINRA arbitration filings nationwide.
Inspired Healthcare Capital Offerings Under Review
The White Law Group is investigating investor losses tied to numerous IHC-sponsored private placements and DST offerings.
Below is a consolidated index of known offerings. Each may be linked to a detailed investor update.
Inspired Healthcare Capital Funds
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Inspired Healthcare Capital Income Fund 3 LLC
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Inspired Healthcare Capital Income Fund 5 LLC / Notes
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Inspired Healthcare Capital Liquidity Fund LLC
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Inspired Healthcare Capital Security Income Fund LLC
Inspired Healthcare Capital DST Offerings
Impact on Investors
Why Many IHC Investments Carried Elevated Risk
Many IHC offerings were structured as Regulation D private placements and DST investments. These products typically involve:
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High upfront commissions (often 6–10% or more)
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Limited liquidity and long holding periods
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Concentration risk
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Dependence on senior-living facility performance
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Limited transparency compared to publicly traded securities
Such characteristics may raise suitability concerns, particularly for retirees or conservative investors seeking income stability.
Legal Options for Inspired Healthcare Capital Investors
Investors may have several potential recovery avenues.
1. FINRA Arbitration
The most common recovery method involves filing a FINRA arbitration claim against the broker-dealer that recommended the investment.
Claims often allege:
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Unsuitable recommendations
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Misrepresentations or omissions
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Failure to supervise
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Overconcentration in alternative investments
2. Individual Investor Claims
Individual claims may allow investors to pursue recovery tailored to their specific losses and circumstances.
3. Class Actions
Class actions may arise, but individual arbitration claims often provide more direct recovery potential.
Speak With a Securities Attorney
If you invested in Inspired Healthcare Capital or an IHC-sponsored DST and experienced losses, you may have legal options beyond the bankruptcy proceeding.
The White Law Group represents retail investors nationwide in securities fraud and FINRA arbitration matters, with offices in Chicago, Illinois and Seattle, Washington.
Call 888-637-5510 for a free, confidential consultation.
FAQs — Inspired Healthcare Capital Lawsuit & Bankruptcy (February 2026)
Has Inspired Healthcare Capital filed for bankruptcy?
Yes. In February 2026, IHC and more than 160 affiliated entities filed for Chapter 11 protection in the Northern District of Texas.
Are distributions likely to resume?
As of February 2026, distributions remain suspended, and no timeline for resumption has been provided.
Does bankruptcy prevent investors from filing FINRA arbitration claims?
No. FINRA arbitration claims against broker-dealers are separate from the bankruptcy case and may proceed independently.
Is Inspired Healthcare Capital under SEC review?
The company has disclosed that it remains under SEC regulatory review, though no public enforcement action has been announced.
Can investors recover losses?
Recovery through the bankruptcy process is uncertain. However, investors may pursue recovery through FINRA arbitration claims against brokerage firms and financial advisors who recommended the investments.
