Alex Jones emerges from bankruptcy after failing to scare off Sandy Hook plaintiffs

(Photo by Drew Angerer/Getty Images)

Alex Jones’ companies come out of bankruptcy exactly as they went in: with a maximum of histrionics and accusations of bad faith.

In April, Jones, a professional shitposter, placed three LLCs associated with his Infowars company into bankruptcy. The companies have been named defendants in tort lawsuits brought by survivors of the Sandy Hook shooting who suffered years of harassment after Jones called them “crisis actors” and accused them of lying about their lives. deceased children.

Jones spent years flouting discovery orders, going so far as to earn himself “death penalty” penalties in Connecticut and Texas, leaving only the issue of damages to be assessed by a jury. He did everything he could not to answer for his conduct in court, even going so far as to tell a judge that he was too ill to be put down just as he was airing his show in the studio, ending by making a finding of contempt. On the eve of his trial in Texas, Jones rushed to bankruptcy court, declared three companies with no business or substantial assets “bankrupt” and successfully stopped the two Sandy Hook cases in their tracks.

If it wasn’t clear from his prior misconduct that Jones was simply using bankruptcy court to evade trials in Connecticut and Texas – without having to endanger his personal assets and those of his principal company Free Speech Systems – its repositories have made no bones about it. Jones’ Lawyers installation a Litigation Settlement Trust to “provide a mechanism for the full payment of litigation claims”, promising to fund it with $10 million in cash from Jones, on the condition that Sandy Hook plaintiffs accept the money in full payment and drop their claims claims against FSS and him personally.

And in case there was any ambiguity, Jones’ attorney Norm Pattis yelped at the the wall street journalboasting that, “We are looking to the bankruptcy courts to compel plaintiffs to estimate the value of their claims in open court according to discernable standards of proof. The plaintiffs turned this dispute into a macabre game of morality and refused to negotiate in good faith. We hope they will show respect to the federal courts.

At that point, all hell broke loose. The American trustee filed a furious movement Accusing Jones of acting in bad faith, the Sandy Hook plaintiffs dropped Worthless LLCs as defendants in their state lawsuits, and they all descended on U.S. Bankruptcy Judge Christopher’s courtroom. Lopez for shouting about it.

During the hearing, Jones’ bankruptcy attorney Kyung Shik Lee proved he was no more susceptible to shame than his client, excoriating Sandy Hook plaintiffs for the ingratitude he put on finally money on the table, and all he heard was complaints. By comparison, FSS made $56 million in 2021 alone, and Jones was trying to pass on plaintiffs an amount that wouldn’t even cover their accrued legal fees. Nonetheless, Lee huffed that there were “limited funds and we’re trying to maximize them to go to plaintiffs.”

And after all that drama, the bet didn’t even work out. After the LLCs were dismissed as defendants in state lawsuits, the tort cases were sent to Texas and Connecticut for trial. Which left LLCs more or less worthless in bankruptcy with virtually no creditors and only a super pissed off American trustee.

Which brings us to yesterday, where LLCs made a big show to pull out of bankruptcy with the greatest reluctance in the world, loudly protesting the slanderous, false, not to say hurtful, allegations that they acted in less than good faith. The best faith! And they weren’t tapping because the template was up – they were practically kicked out at gunpoint by the mean old fiduciary.

“The debtors’ former connection with Alex Jones is too great a sin in the eyes of the American trustee for the debtors to overcome”, the motion practically hyperventilates, adding later that “apparently the American trustee does not believe that paying the creditors more than they would receive in liquidation is a valid reorganization objective.

The Sandy Hook plaintiffs are also to blame because they “decided that a jury verdict against Alex Jones and FSS was more important to them than maximizing their recovery.” Bookmark this one and see if the jury awards them more than the $10 million offered here.

The motion also contains some truly bizarre assertions, such as that the LLCs “did not contemplate any third-party release” and “did not intend to deprive the plaintiffs of their rights to a jury trial.” Which is an odd way to describe a proposed litigation settlement trust that relied on plaintiffs releasing Jones and FSS from all claims and don’t go to trial.

Indeed, the petition repeatedly concedes that the primary purpose of the bankruptcy was to resolve the tort dispute: “Perhaps the US trustee thinks Jones should have been willing to contribute more than $7.7 million dollars for nothing, but that’s not how the world works outside of government,” his lawyers quip.

And so this whole sordid exercise comes to an end, albeit after a long display of weeping, moaning and gnashing of teeth.

“Nevertheless, the Debtors, under the direction of their independent [restructuring officer]recognize that the dismissal is in the best interests of the debtors and their assets because the American trustee has continued to oppose the cases,” they sigh.

Yeah, yeah, tell the jury.

InfoW, LLC (22-60020) [Bankruptcy Docket, via Court Listener]

Dye Liz lives in Baltimore where she writes on law and politics.

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