Company bankruptcy dismissed...

A federal bankruptcy judge on Friday granted conspiracy theorist Alex Jones’ request to convert his bankruptcy filing into a liquidation of his personal assets in order to pay the massive defamation verdicts owed to the families of Sandy Hook Elementary School shooting victims.

But the judge dismissed a bankruptcy case for Jones’ media company, Free Speech Systems, leaving the future of his show on Infowars in question but effectively allowing him to continue broadcasting.

Jones founded Infowars, which operates under Free Speech Systems, in 1999.

“I was never asked today to make a decision to shut down a show or not. That was never going to happen today one way or another,” Bankruptcy Judge Christopher Lopez of the Southern District of Texas said in his ruling. “This case is one of the more difficult cases I’ve had. When you look at it, I think creditors are better served in pursuing their state court rights.”

Lopez said dismissing the company’s bankruptcy case was in the best interest of creditors and the estate.

Families who sued Jones won lawsuits in Connecticut and Texas and were collectively awarded $1.5 billion in damages after they claimed he defamed them and inflicted emotional distress by repeatedly suggesting on his show that the Sandy Hook massacre was a hoax. A gunman killed 20 first-grade children and six adults at the school in Newtown, Connecticut, on Dec. 14, 2012.

But the families who filed their suit in Connecticut and those who filed in Texas clashed in court Friday over whether Free Speech Systems’ separate Chapter 11 bankruptcy filing should be converted into a Chapter 7 liquidation; the Connecticut families favored liquidation while the Texas families wanted the bankruptcy case dismissed.

A lawyer for the Texas families argued a liquidation of the company would be a longer process for all of the plaintiffs to get the money owed in the defamation verdicts, while a lawyer for the Connecticut families said a dismissal of the company’s bankruptcy case might lead all of the families to fight with one another in their respective state courts over the money. Jones also wanted the company’s bankruptcy case dismissed.

“There’s no easy or right answer here,” Lopez said as he appeared to struggle with his decision.

Alex Jones during a rally in Austin, Texas, on April 25, 2020. Gary Miller / Getty Images file

Christopher Mattei, a lawyer for the Sandy Hook families in Connecticut, said the judge’s ruling gives them authority to “move immediately to collect against all Infowars assets, and we intend to do exactly that.”

“For too long, Jones used his platform to inflict unfathomable emotional pain on, and more than a billion dollars in damage to, survivors of the Sandy Hook shooting,” Mattei said in a statement. “Mr. Jones and soon-to-be defunct Infowars can’t pay that debt so the Infowars assets will be used to pay some portion of what he owes. We will pursue any future income he may earn to satisfy the rest.”

Lopez said he would appoint an interim trustee to help guide the process of Jones’ personal Chapter 11 bankruptcy filing into a Chapter 7 liquidation, which permits the trustee to oversee and sell Jones’ assets.

Jones’ lawyer, Vickie Driver, told Lopez that there is money that can go to the trustee in the form of the sale of Jones’ $2.8 million Texas ranch.

In a filing ahead of Friday’s hearing, families of victims of the Sandy Hook Elementary School shooting had also urged Lopez to install a permanent trustee who can “safeguard assets and prevent further value destruction” as Jones must pay off a hefty debt he owes them in defamation verdicts.

The families in the filing also accused Jones of “erratic behavior over the past weeks,” noting comments he has made on his show claiming he has no assets other than the money he can make from selling nutritional supplements. He has specifically told his listeners to continue buying the products from a website affiliated with his father, David Jones, a dentist who is known as “Dr. Jones,” according to the filing.

The families accuse Jones of trying to divert assets from his media company, Free Speech Systems, to support his future business operations, instead.

Jones’ “flagrant and repeated attempts to funnel property of the FSS estate to an unaffiliated entity owned by his father — while using the Infowars brand name and infrastructure to do so — is intentionally value destructive,” the families said.

Driver denied the accusations in court.

At his trial in Texas in 2022, Jones generally blamed “corporate media” for twisting his words and misportraying him but didn’t specify how.

Jones had filed for Chapter 11 bankruptcy protection that year, a move that lawyers for the plaintiffs criticized as a maneuver to avoid paying the debt. A judge ruled last year that Jones, who had said in court documents that he has about $9 million in personal assets, can’t use bankruptcy to wipe out the legal judgments.

His attorneys wrote in a court filing last week that “there is no reasonable prospect of a successful reorganization” of his debts, so they are seeking permission from a judge to convert his bankruptcy filing into Chapter 7 liquidation.

Sandy Hook families in Connecticut say they support the judge’s approving liquidation for both Jones’ personal assets, as they want to see how he can fulfill his financial obligations to them, and Free Speech Systems, which had also sought bankruptcy protection.

A lawyer for the families said last week that Jones’ fulfilling his financial obligations is part of “meaningful accountability” after his decades of incendiary rhetoric.

Jones suggested on his show this week that Infowars will end as his audience knows it in a matter of days.

“I’m going to stay with the ship until it fully sinks,” he said, adding, “At the last moment, I will then step onto the next ship.”