A federal bankruptcy judge on Thursday blocked families of Sandy Hook victims from trying without delay to collect assets from conspiracy theorist Alex Jones’ soon-to-be-sold media company.
In doing so, Judge Christopher Lopez of the Southern District of Texas sided with court-appointed administrator Christopher Murray, who is overseeing the settlement of Jones’ estate. Murray accused certain families in an “emergency” filing on Sunday of attempting a “value-destructive cash grab” while he has yet to complete “an orderly liquidation” and the sale of the company, Free Speech Systems.
Lopez agreed that Murray should continue his work of valuing and liquidating Jones’ assets and told him, “You will not hand over a bank account.”
Murray, in his filing, asked Lopez to implement a 90-day pause on the ability of families and other creditors to collect on asset sales, including liquidating the Free Speech System’s inventory.
He wrote that “the specter of a disorderly seizure of the FSS’s assets, including its cash, threatens to throw the business into chaos, potentially paralyzing it, to the detriment of the interests of the Chapter 7 estate for which the trustee is responsible.”
Lopez said Thursday that he would issue an order clarifying that no money was to be turned over and that he would review the administrator’s progress next month.
“I don’t think there is an emergency anymore,” Lopez said in making his decision.
The latest legal dispute has exposed a rift between Sandy Hook Elementary School families who have filed a defamation lawsuit in Texas, where Jones resides, and in Connecticut, where the massacre occurred in 2012. A gunman killed 20 first graders and six adults.
The Texas litigation was brought by the mother and father of one of the dead children, while the Connecticut lawsuit was filed on behalf of the families of eight of the victims.
In 2022, the plaintiffs in the two lawsuits were collectively awarded nearly $1.5 billion after alleging that Jones defamed them and inflicted emotional distress by repeatedly suggesting on his Infowars platform, which is operated by Free Speech Systems, that the shooting was a hoax. .
But neither family was able to receive money from Jones, who said he could not pay such a large sum and filed for bankruptcy after the verdicts.
On June 14, Lopez ruled that Jones’ bankruptcy filing can be converted into a liquidation of his personal assets to help pay for the defamation verdicts, but the judge also dismissed a separate bankruptcy case for Free Speech Systems, concluding that “creditors are better served.” in pursuing its state court rights”, rather than through federal bankruptcy court.
The decision to dismiss Free Speech Systems’ bankruptcy case was also favored by Jones, who continues to broadcast on Infowars, although he has suggested in recent weeks that he may have to end his show in its current form if his company is sold.
Following the Lopez ruling, the Sandy Hook parents in the Texas lawsuit asked a state district court judge to force Free Speech Systems to turn over “all money,” including “money held in any bank accounts or controlled by any other third parties”. under the direction” of the media company.
The move has been opposed by Murray as well as Connecticut plaintiffs, who fear all the families will have to fight for Jones’ assets.
“To be clear, Connecticut Families supports an orderly liquidation of FSS assets and pro rata distributions among FSS creditors who hold valid claims,” they wrote in a document this week in support of the administrator’s emergency request. “Texas Families clearly do not have the same goals. Instead, they seek preferential treatment and disproportionate recoveries while trying to win the very court race they claimed to have avoided on June 14.”
Attorneys for the Texas plaintiffs urged Lopez not to grant the administrator’s request to block them because, they said, the judge has already ruled that Free Speech Systems should fall under state jurisdiction.
But Lopez said Thursday that the Texas judge’s order granting the Texas plaintiffs’ request “conflicts” with what he ruled this month in allowing the trustee to have control.
An attorney for the Texas plaintiffs, Mark Bankston, said his clients are “frustrated that after all they will not be allowed to exercise their rights in state courts” and believes “this case will remain in limbo, much to the delight of Mr. Jones.” .
He said his clients want to partner with the other plaintiffs in collecting an equal amount of money owed by Jones, but “we have been continually rebuffed,” adding that other plans to make Jones pay while forcing him to ” never talk about Sandy Hook again” were vetoed by the other plaintiffs.
Christopher Mattei, an attorney for the Sandy Hook families in Connecticut, said he was pleased the judge did not allow the Texas plaintiffs to proceed.
“Connecticut families have always sought a fair and equitable distribution of the assets of the Free Speech System to all families, and today’s decision puts us back on that path,” Mattei said in a statement.
Lopez, during Thursday’s hearing, declined to address the divide between the families.
“The last thing I want to do is start discussing another dispute between two groups of families who have been through enough,” he said. “Let’s just follow the rules, follow the code and follow the order.”
Court records indicate Jones has about $9 million in personal assets, while Free Speech Systems holds about $6 million in cash, with more than $1 million in inventory.
Jones had warned this week on his show that Thursday’s hearing could bring Infowars closer to closure.
“I know it’s exhausting. It’s exhausting for me to have this rollercoaster battle as the system tries to shut down Infowars,” he said, adding that he wants to continue broadcasting because it allows him to make a profit that his creditors should want. he can pay them.
But “they don’t want money,” he told his listeners, “they want me to be silenced.”
This story originally appeared on NBCNews.com read the full story
