Alex Jones’ InfoWars, IWHealth and Prison Planet TV file for bankruptcy

Three companies owned by Austin-based conspiracy theorist Alex Jones have filed for bankruptcy, listing as creditors the parents of Sandy Hook Elementary students who successfully sued him for defamation in Texas and Connecticut.

As part of the Chapter 11 bankruptcy, Jones paid $725,000 of his own money into a litigation settlement trust that now holds the assets of all three companies.

The trust is supposed to pay damages to the families of Sandy Hook, according to bankruptcy papers filed Sunday and Monday in federal court in Victoria.

Another $2 million will be paid to the trust at a later date, according to the filings, without indicating the source of the money.

Travis County and Connecticut judges found Jones liable for defamation and emotional distress after he and his media company InfoWars described the 2012 school shooting – which left 20 students and six adults dead in Newtown, in Connecticut – like a hoax.

The judges found that Jones had harmed the parents’ records by improperly withholding information and documents necessary to enforce their rights. The next step will be trials to determine how much money Jones and his companies will have to pay in damages.

The first such trial is scheduled to begin next week in Austin. The families’ attorneys were unclear Monday how the bankruptcy filing might affect that trial and a second one scheduled for June in Austin.

Jones, Free Speech Systems and the three companies seeking bankruptcy protection have spent more than $10 million in legal fees and expenses for the Sandy Hook litigation, according to bankruptcy filings.

Companies file for bankruptcy

The bankruptcy case did not involve Free Speech Systems, which is wholly owned by Jones and operates media company InfoWars.

Companies seeking bankruptcy protection are:

• InfoW Inc, which owns the copyrights and domain names related to Infowars.com.

• IWHealth, which holds the cash flow from the royalties under an agreement with Youngevity, whose dietary supplements and other products are sold on the InfoWars website.

• Prison Planet TV, which owns the copyrights and domain names related to prisonplanet.tv.

Jones divested his 100% stake in the three companies to the litigation settlement trust before filing for bankruptcy, according to court documents.

InfoW and Prison Planet TV license intellectual property and domain names to Free Speech Systems, but the three companies do not produce or control Infowars content, according to the bankruptcy filing.

Parents allege financial irregularities

Earlier this month, parents of two children killed in the Sandy Hook shooting filed a separate lawsuit in Travis County State District Court, claiming Jones tried to hide assets from them. and courts by fraudulently diverting millions of dollars to himself and shell companies. .

The lawsuit alleged that the illegal transfers included $18 million paid directly to Jones from 2018 to 2021 — payments that were on top of an annual salary exceeding $600,000 and which began the same year the parents sued Jones and his friends. businesses.

The lawsuit seeks a court order voiding the transfers in violation of the Texas Uniform Fraudulent Transfer Act, which prohibits the defendants from protecting the assets of creditors.

The parents are also seeking a court-appointed receiver to take over the transferred assets and other properties held by Jones and Free Speech Systems.

In the bankruptcy filing, Jones’ attorneys asked U.S. Bankruptcy Judge Christopher Lopez, who has courtrooms in Houston and Victoria, to approve two trustees to manage the litigation trust and oversee the three companies in bankruptcy.

Both are former federal bankruptcy judges in Texas — Russell Nelms, who served from 2004 to 2018, and Richard Schmidt, who served from 1987 to 2015.

Trustees are needed to put businesses “in the hands of two individuals knowledgeable in fiduciary law and with years of experience supervising debtors to maximize recoveries for creditors,” the bankruptcy filing said.

Hoax allegations create ‘financial distress’

The “financial distress” of the three companies stems primarily from statements made by Jones and others on InfoWars that questioned the truth about the Sandy Hook school shooting, according to bankruptcy documents.

The extent of this distress, however, has yet to be determined by the courts.

The first step in that process — the Travis County trial next week to determine damages — involves Neil Heslin and Scarlett Lewis, parents of 6-year-old Jesse Lewis. They sued after Jones alleged the school shooting was “a giant hoax” and disputed Heslin’s claim that he held his dead son afterwards.

The June lawsuit involves Leonard Pozner and Véronique De La Rosa, the parents of 6-year-old Noah Pozner, who filed a lawsuit after Jones described the school shooting as a ‘false flag’ operation intended to create a pretext for federal limits on gun rights. .

The litigation trust created by Jones is intended to pay claims from these lawsuits as well as similar, albeit yet unscheduled, lawsuits in Connecticut.

Additionally, bankruptcy documents indicate the trust is intended to pay a claim from Marcel Fontaine, whom InfoWars mistakenly identified as a suspect in the 2018 high school shooting in Parkland, Florida.

A trial in the Fontaine case is scheduled for September in Austin.