Infowars Bankruptcy: The Auction Conspiracy Explained

Welcome to today’s blog post, which focuses on more conspiracy theories. Yes, even the sale of Alex Jones’s Infowars is full of conspiracy theories. Of course, the rumor mill is that Jones still owns Infowars or that The Onion, the satire site, didn’t win at the bankruptcy auction. But here’s what you need to know about Infowars’ bankruptcy auction.

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Birds of a Feather Love Conspiracy Theories

I’ve said multiple times that Rudy Giuliani is the gift that keeps on giving when it comes to bankruptcy law. You could write an entire textbook on bankruptcy law procedure and creditor and debtor law, using his case as the perfect example.

But besides Giuliani, he is a close second with Alex Jones and Infowars. Here’s another classic case. To give you a quick background, Jones filed for bankruptcy based on a defamation lawsuit from the families of the victims of the Sandy Hook Elementary School Shooting. This forced Jones into Chapter 7 bankruptcy.

At issue with Giuliani’s case was whether his defamation judgment could be wiped out in bankruptcy. Giuliani was sued by election poll workers Shaye Moss and Ruby Freeman. Giuliani accused them of changing votes in favor of President Biden and against former President Trump.

Defamation of character, arguably, as an intentional tort (act), can’t be wiped out in bankruptcy. If the dischargeability of a debt is being contested, the next step is an adversary proceeding. Giuliani ultimately had his case dismissed, and creditors are seizing his assets. In one social media post on X, Giuliani said he needed money for food. Nothing like free food. Sounds like entitlements to me.

Alex Jones, Infowars, and the Bankruptcy Auction

When assets are nonexempt or not protected in bankruptcy, a debtor can buy back those assets or surrender them to the trustee, who sells them. In this case, Infowars is sold at an auction, and the proceeds are used to pay back the victims and other creditors.

The winning bid on Infowars was by The Onion, a satirical online newspaper. Check them out sometime; they do some funny, sarcastic stuff. They jumped into a legal brief once in the Supreme Court and started in Latin by saying, “You are stupid,” or something to that effect. So, I love what they do, and it’s great to see them jump into the appellate arena by submitting an amicus brief.

The Conspiracy Theories Continue

The Onion has confirmed to multiple media outlets that the bankruptcy trustee accepted their bid. What happened is that the bankruptcy judge paused the sale to look into it. Simply put, the judge wants transparency.

Is this the norm? Yes and no. If we’re talking about a $4,000 used car that the bankruptcy trustee is selling at an auction, the judge isn’t going to have an evidentiary hearing. However, the judge has to approve the sale at the end of the day. Typically, bankruptcy judges approve the trustee’s recommendation. This is part of the regular process and procedure regarding bankruptcy.

But if you look up Alex Jones online, I read headlines like “meltdown,” and all his followers say, “Yes, we’re not giving up. It’s ours. The Onion couldn’t buy it. Backroom deals, etc.”

Let’s make this simple. There was another bid from a company related to them, but if they had the winning bid, guess what would happen? The same thing. The money is disbursed to the victims of Sandy Hook and all the other creditors in the same way. Same difference.

The only difference in this case is that an offer was made where the victims would get more money, even though they didn’t have the highest bid. So it’s a complicated bidding offer that hasn’t been released publicly, but the bankruptcy trustee, in their opinion, chose the best offer for the victims.

Trustees have that authority, and their purpose is to protect the bankruptcy estate and do what’s best for creditors.

So, it would be surprising if The Onion didn’t get it. The Onion has replied to other media, saying they bought it and are moving forward. But online, you’re going to read a couple of different things.

Let’s not forget what happened with Infowars and the defamation lawsuit. The lawsuit was because of the lies they were spreading about the Sandy Hook School Shooting. Specifically, that the tragic event never took place. I did see the documentary on HBO, which, by the way, no matter what Alex Jones says, in court, he testified that he lied about the Sandy Hook shooting.

Now, I know his followers aren’t going to see that, but they could just look it up. But wait, I know the answer: the video was manipulated with AI. I’m also sure QAnon is about to do its next drop. So it is what it is. Conspiracy theorists are conspiracy theorists, but that won’t stop Infowars from being sold. So far, it looks like The Onion is the one that’s going to get it. I’ll let you know if something changes as the hearing occurs tomorrow.

Updated Note: Rudy Giuliani has settled his case with Ruby Freeman and Shaye Moss. The terms of that agreement are confidential. The sale of Infowars remains pending.

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