Judge Christopher Lopez approved converting Jones’ proposed personal bankruptcy reorganization to a liquidation, but threw out the attempted reorganization of his company, Austin, Texas-based Free Speech Systems. Many of the Sandy Hook families had asked that the company also be liquidated.
If Free Speech Systems’ bankruptcy reorganization had been converted to a liquidation, Jones could have lost ownership of the company, its social media accounts, the Infowars studio in Austin and all copyrights as the company’s possessions were sold. Jones smiled as the judge dismissed the company’s case.
The rulings came the day after students who survived the Dec. 14, 2012, massacre at Sandy Hook graduated from high school. During the ceremony Thursday, the principal of Newtown High School in Connecticut read the names of 20 first-graders who were killed along with six educators on Dec. 14, 2012. About 60 of the students graduating survived the mass shooting that Jones repeatedly called a hoax.
Many relatives of those killed have said they were traumatized by Jones’ comments and his followers’ actions. They testified 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. One parent said someone threatened to dig up his son’s grave.
It wasn’t immediately clear what will happen to Free Speech Systems, Infowars’ parent company that Jones built into a multimillion-dollar moneymaker over the last 25 years.
One scenario could be that the company and Infowars are allowed to keep operating while efforts to collect on the $1.5-billion debt are made in state courts in Texas and Connecticut, where the families won lawsuits against Jones, according to lawyers involved with the case.
Another scenario is that lawyers for the Sandy Hook families go back to the bankruptcy court and ask Lopez to liquidate the company as part of Jones’ personal case, because Jones owns the business, lawyers said.
Lopez said his sole focus in determining whether to dismiss Free Speech Systems’ case or order a liquidation was what would be best for the company and its creditors, including the Sandy Hook families. Lopez also said Free Speech Systems’ case appeared to be one of the longest running of its kind in the country, and it was approaching a deadline to resolve it.
“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,” Lopez said. “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.”
Many of Jones’ personal assets will be sold off, but his primary home in the Austin area and some other belongings are exempt from bankruptcy liquidation. He has moved to sell his Texas ranch worth about $2.8 million, a gun collection and other assets to pay debts.
The Sandy Hook families’ lawyers believe Jones would keep broadcasting his show in some other fashion. They told the judge they intend to go after any of his future earnings. Jones has told his audience that he will return and claimed the loss of his company would only make him more popular.
In the lead-up to Friday’s hearing, Jones had been telling his followers to download videos from his online archive to preserve them and pointing them to a new website of his father’s company if they want to continue buying the dietary supplements he sells on his show.
Jones has about $9 million in personal assets, according to the most recent financial filings in court. Free Speech Systems, which employs 44 people, has about $6 million in cash on hand and about $1.2 million worth of inventory, according to J. Patrick Magill, the chief restructuring officer appointed by the court to run the company during the bankruptcy.
Jones and Free Speech Systems filed for bankruptcy protection in 2022, when relatives of many victims of the 2012 school shooting won lawsuit judgments of more than $1.4 billion in Connecticut and $49 million in Texas.
Chris Mattei, a lawyer for the families in the Connecticut case, said liquidating Free Speech Systems would “enable the Connecticut families to enforce their $1.4 billion in judgments now and into the future while also depriving Jones of the ability to inflict mass harm as he has done for some 25 years.”
Jones and Free Speech Systems initially filed for bankruptcy reorganization protection that would have allowed him to run Infowars while paying the families with revenues from his show. But the two sides couldn’t agree on a final plan, and Jones recently filed for permission to switch his personal bankruptcy from a reorganization to a liquidation.
The families in the Connecticut lawsuit, including relatives of eight dead children and adults, asked that Free Speech Systems’ bankruptcy case also be converted to a liquidation. But the parents in the Texas suit — whose child, 6-year-old Jesse Lewis, died — wanted the company’s case dismissed.
Lawyers for the company filed documents indicating it supported liquidation, but attorneys for Jones’ personal bankruptcy case wanted the judge to dismiss the company’s case.
Kyle Kimpler, an attorney for the families seeking liquidation, had told the judge that dismissing the case could lead to a “race to the courthouse.” It’s possible one family could get everything while another gets nothing, he added.
Although Jones has since acknowledged that the Sandy Hook shooting happened, he has claimed on his recent shows that Democrats and the “deep state” are conspiring to shut down his companies and take away his free speech rights. He also has said the Sandy Hook families are being used as pawns in the conspiracy. The families’ lawyers say that is nonsense.
The families have a pending lawsuit in Texas accusing Jones of illegally diverting and hiding millions of dollars. Jones has denied the allegations.
Associated Press writer Lozano reported from Houston, Collins from Hartford, Conn.