Sandy Hook families ask bankruptcy judge to liquidate Alex Jones' media company

Relatives of victims of the Sandy Hook Elementary School shooting are asking a bankruptcy judge to liquidate conspiracy theorist Alex Jones’ media company, including Infowars, instead of allowing him to reorganize his business as they seek to collect on $1.5 billion in lawsuit verdicts against him.

Lawyers for the families filed an emergency motion Sunday in U.S. Bankruptcy Court in Houston, saying Free Speech Systems has “no prospect” of getting a reorganization plan approved by the court and has “failed to demonstrate any hope of beginning to satisfy" their legal claims, which relate to Jones calling the 2012 school shooting a hoax.

A hearing in Free Speech Systems’ bankruptcy case was scheduled for Monday related to a dispute over the company’s finances.

Jones went on his web and radio show over the weekend saying there was a conspiracy against him and he expected Infowars to be shut down in a month or two because of the families’ bankruptcy court filings. The comments included profanity-laden rants, and Jones appeared to cry at points.

“There’s really no avenue out of this,” Jones said on his show Sunday. “I’m kind of in the bunker here. And don’t worry. I’ll come back. The enemy can’t help but do this attack.”

On Saturday, Jones was defiant, saying “At the end of the day, we’re going to beat these people. I’m not trying to be dramatic here, but it’s been a hard fight. These people hate our children.”

A bankruptcy lawyer for Free Speech Systems did not immediately return a message seeking comment Monday.

Liquidation could mean that Jones, based in Austin, Texas, would have to sell most of what he owns, including his company and its assets, but could keep his home and other personal belongings that are exempt from bankruptcy liquidation. Proceeds would go to his creditors, including the Sandy Hook families. There is no agreement or court ruling yet, however, on how a liquidation would work in Jones’ cases.

Jones and Free Speech Systems both filed for bankruptcy reorganization after the Sandy Hook families won lawsuits in Texas and Connecticut claiming defamation and emotional distress over Jones’ hoax claims.

Jones said on his show that the school shooting that killed 20 first graders and six educators was staged by crisis actors in efforts to get more gun control laws passed.

Jones’ lawyers have been unable to reach an agreement over the past several months with attorneys for the Sandy Hook families on how to resolve the bankruptcy cases. Jones’ lawyer recently said in court that the cases appear headed to liquidation or may be withdrawn. The emergency motion filed Sunday was filed in Free Speech System’s case.

If the cases are withdrawn, it would put Jones back in the same position he was in after the $1.5 billion was awarded in the lawsuits and it would send efforts to collect the damages back to the state courts where the verdicts were reached.

The families of many, but not all, of the Sandy Hook victims sued Jones and won the two trials in Connecticut and Texas.

The relatives said they were traumatized by Jones’ comments and the actions of his followers. They testified at the trials about being harassed and threatened by Jones’ believers, some of whom confronted the grieving families in person saying the shooting never happened and their children never existed.

According to the most recent financial statements filed in the bankruptcy court, Jones personally has about $9 million in assets including his $2.6 million Austin-area home and other real estate. He also listed his living expenses at about $69,000 for April alone, including about $16,500 for expenses on his home including maintenance, housekeeping and insurance.

Infowars’ parent company, Free Speech Systems, which employs 44 people, had nearly $4 million in cash on hand at the end of April. The business made nearly $3.2 million in April, including from selling the dietary supplements, clothing and other items that Jones promotes on his show, while listing $1.9 million in expenses.

Jones and the Sandy Hook families have offered different proposals to settle the $1.5 billion he owes them. Last year, Free Speech Systems filed a plan that would leave $7 million to $10 million a year to pay off creditors.

The families later countered with their own proposal: either liquidate Jones’ estate and give the proceeds to creditors, or pay them at least $8.5 million a year for 10 years — plus 50% of any income over $9 million per year.