Sandy Hook Families Are Fighting Alex Jones and the Bankruptcy System Itself

HOUSTON — The Infowars conspiracy broadcaster Alex Jones, who faces greater than $1.4 billion in authorized damages for defaming the households of the Sandy Hook taking pictures victims, has devised a brand new technique to taunt them: wriggling out of paying them the cash they’re owed.

Mr. Jones, who has an estimated internet price as excessive as $270 million, declared each enterprise and private chapter final yr because the households gained historic verdicts in two lawsuits over his lies concerning the 2012 taking pictures that killed 20 first graders and 6 educators at Sandy Hook Elementary College in Newtown, Conn.

A New York Instances assessment of economic paperwork and courtroom information filed over the previous yr discovered that Mr. Jones has transferred hundreds of thousands of {dollars} in property, money and enterprise offers to household and buddies, together with to a brand new firm run by his former private coach, all probably out of attain of collectors. He has additionally spent closely on luxuries, together with $80,000 on a personal jet, bodyguards and a rented villa whereas he was in Connecticut to testify at a trial final fall.

“If anyone thinks they’re shutting me down, they’re mistaken,” Mr. Jones stated on his new podcast final month.

The households now face a stark actuality. It’s not clear whether or not they are going to ever accumulate a good portion of the belongings Mr. Jones has transferred. So their capacity to get something remotely near the jury awards is inextricably tied to Mr. Jones’s capability to make a residing because the purveyor of lies — together with that the taking pictures was a hoax, the dad and mom have been actors and the youngsters didn’t actually die — that ignited years of torment and threats towards them.

Legal professionals for Mr. Jones stated in a submitting late final yr that “any argument that Jones should quit his public life, or discontinue public discourse, is opposite to supporting his capacity to fund a plan and pay collectors.”

Mark Bankston, the households’ Texas lawyer, doesn’t disagree. “There’s an opportunity we’re going to be compelled right into a state of affairs the place we’re going to be checking to see how Infowars is doing each month to determine if our purchasers are getting paid or not,” he stated.

Earlier this month, Mr. Jones supplied to pay the households and his different collectors a complete of $43 million over 5 years as a part of a chapter plan, which attorneys for the households instantly dismissed as laughable and riddled with monetary holes. The decide ordered Mr. Jones to fill within the gaps in his monetary disclosures by the tip of the month.

However Mr. Jones’s continued obfuscation about his internet price has given him leverage over the households, who’re additionally combating an American chapter system that makes the survival of companies a precedence and has thus far given Mr. Jones a bonus in courtroom.

Though Infowars has estimated revenues of some $70 million a yr — hardly a mom-and-pop store — Mr. Jones was capable of file for Chapter 11 below the extra lenient chapter guidelines of the Small Enterprise Reorganization Act, often known as Subchapter V. The legislation first took impact in early 2020, however was quickly broadened to help small companies struggling through the pandemic.

In contrast to in a conventional Chapter 11 chapter, Subchapter V provides collectors just like the Sandy Hook households nearly no say in a restructuring plan, nor can they file a competing plan. They’ll problem Mr. Jones’s strategy, however an deadlock in talks might end in liquidation of the corporate, placing them in line to gather a fraction of the damages.

A liquidation would finish Infowars, however Mr. Jones could be free to start out one other firm identical to it.

“We’re doing nicely in Chapter V,” Mr. Jones stated on Infowars in September, misstating the title of the rule. “No matter judgments they’ve can’t shut us down. No matter revenue there may be sooner or later these jerks get, however who cares, we’re nonetheless on air.”

Final month, Mr. Jones’s attorneys submitted an announcement of his private monetary affairs prefaced by 5 pages of disclaimers saying that Mr. Jones didn’t absolutely bear in mind the place he holds financial institution accounts, what number of trusts he had arrange over the previous decade and the whereabouts of his 2022 W-2 type documenting his wages. He has not filed a federal earnings tax return since 2020.

Mr. Jones continues to enchantment each day to his viewers to purchase extra of the weight loss program dietary supplements and different merchandise he markets on air and to donate to Infowars, saying the Sandy Hook households are “puppets” in a plot by his political enemies to bleed him dry. His attorneys have stated in courtroom that Infowars’ enterprise is booming.

Mr. Jones and a dozen members of his authorized crew didn’t reply to questions from The Instances about his funds or his chapter instances.

Earlier this month, the households requested the decide to order Mr. Jones to pay them the complete jury awards, with no risk for settlement over a lesser quantity — in authorized terminology, to make Mr. Jones’s money owed to the households “non-dischargeable” by way of chapter. The decide has but to rule.

The households have declined to talk publicly concerning the case, however attorneys say their submitting suggests they’ve concluded that Mr. Jones might by no means be put out of enterprise, and they’re demanding the complete quantity owed if he’s to stay on the air.

“Originally, the purpose of it was to do away with him,” Mr. Bankston stated. “And it’s such as you understand you may’t do away with him. He’s like a foul penny. He’ll simply hold coming again.”

Odd Transactions

Mr. Jones based Infowars in Austin, Texas, round 1999. He broadcast his theories from his home and commenced producing feature-length, conspiracy-themed movies he bought by mail or gave away. He was bankrolled by his father, a profitable dentist who later helped set up Infowars’ weight loss program dietary supplements enterprise, nonetheless its most profitable income stream.

In December 2012, solely days after the Sandy Hook taking pictures, Mr. Jones started claiming on air that the bloodbath was a plot by the federal government to confiscate People’ firearms. Visitors to his web site surged. Lenny Pozner, the daddy of Noah Pozner, a 6-year-old who died at Sandy Hook, needed to transfer a dozen instances after conspiracy theorists repeatedly posted his residence tackle on the web.

By 2018, the households had filed three separate defamation lawsuits towards Mr. Jones, who refused to submit court-ordered proof. However as courtroom sanctions piled up and the instances started to show towards him, Mr. Jones undertook a sequence of bizarre monetary transactions.

“There’s an excessive amount of cash coming in” for Mr. Jones to be as broke as he claims, Mr. Bankston stated.

In February 2020, Mr. Jones traveled to the Cayman Islands, an offshore tax haven, in line with textual content messages that surfaced throughout one of many trials, though it’s unknown if he carried out any enterprise on the journey. The next yr, as judges in two states threatened Mr. Jones with default for stonewalling within the Sandy Hook instances, he solid the primary of a sequence of enterprise partnerships with associates.

In October 2021, he made an settlement with a brand new firm, Auriam Companies, based the earlier month by Anthony Gucciardi, a wellness and way of life blogger who’s a buddy of Mr. Jones and one in all his earliest dietary supplements companions. The corporate was to be an middleman for bank card processing.

In February final yr, Mr. Jones transferred a $3 million residence overlooking the Barton Creek Greenbelt in Austin to his present spouse, Erika Wulff Jones.

Mr. Jones struck a contract in July with one other new firm, Blue Ascension, based only some months earlier by Mr. Jones’s former private coach and assistant, Patrick Riley.

On July 29, a father or mother firm Mr. Jones absolutely owns, Free Speech Programs, filed for Chapter 11 chapter. On the core of the declare was $54 million that Mr. Jones stated Free Speech Programs — with claimed belongings of solely $14.6 million — owed to PQPR, an organization managed by Mr. Jones and his dad and mom.

The Sandy Hook households responded with a lawsuit claiming that Mr. Jones was fraudulently transferring his belongings exterior his enterprise, past the attain of collectors, and was transferring between $11,000 a day and $11,000 every week, and as much as 80 % of his dietary supplements gross sales revenues, to PQPR.

Mr. Jones’s attorneys have defended his actions as a technique to hold Infowars afloat when different distributors refused to do enterprise with him.

In early August, Mr. Jones’s monetary empire started to unravel. The Texas jury ordered Mr. Jones to pay the dad and mom of the sufferer almost $50 million, and two months later a Connecticut jury awarded the households of eight Sandy Hook victims a unprecedented almost $1 billion. A decide awarded them nearly $500 million extra. In December, Mr. Jones declared private chapter.

Each Chapter 11 instances went earlier than a federal chapter decide in Texas, Christopher Lopez, who changed Mr. Jones’s chief restructuring officer for the Infowars case and expanded the powers of a Justice Division-appointed trustee, Melissa Haselden, to analyze Mr. Jones’s funds. A brand new chief restructuring officer ended the contracts with Auriam and Blue Ascension, however late final yr Infowars requested the courtroom to approve contracts tied to an entrepreneur who had bought merchandise by way of Free Speech Programs up to now, Charles Cicack.

When a Instances reporter known as Mr. Cicack to ask about his work with Infowars, he claimed ignorance of the connection after which deleted references to Infowars from his social media accounts.

On Thursday, Ms. Haselden subpoenaed Mr. Gucciardi and Auriam, demanding that they produce paperwork detailing monetary dealings with Mr. Jones.

Tracing Belongings

It stays unclear how a lot Mr. Jones is definitely price. Current courtroom paperwork point out that he’s persevering with to switch actual property to his household, together with an grownup son.

In late January, below strain from the chapter courtroom, Mr. Jones submitted a private steadiness sheet detailing solely about $5.6 million in complete belongings, together with $368,899 in financial institution accounts, $682,899 in one thing known as “stock platinum,” and a $2.2 million homestead.

Within the February assertion of Mr. Jones’s monetary affairs, the one prefaced with disclaimers about its accuracy, his property was valued at a complete of $10 million, together with a house, lake home and rural acreage price $5.4 million. The assertion stated Mr. Jones owned two vehicles and two boats valued at $274,000, however listed as “unknown” the worth of his premarital settlement, eight restricted legal responsibility firms and several other trusts. His said month-to-month earnings was $129,000, however $104,000 of that was from sources that weren’t disclosed.

“The monetary reporting and information are incomplete and the accuracy is unsure,” Ms. Haselden, the Justice Division monitor, stated in a courtroom submitting.

This previous week, Ms. Haselden filed a subpoena for paperwork displaying Mr. Jones’s cryptocurrency transactions and different monetary dealings. The Southern Poverty Legislation Heart has tracked hundreds of thousands of {dollars} in cryptocurrency donations final yr to accounts tied to Mr. Jones.

Final month, the households retained an asset tracing agency to attempt to unearth extra of Mr. Jones’s cash, a course of anticipated to take months.

To this point, the one cash Mr. Jones has paid within the Sandy Hook matter has been to his attorneys and the courts, as he has run up hundreds of thousands of {dollars} in authorized charges and sanctions for abusing the judicial course of. One other trial for damages — probably on prime of the greater than $1.4 billion Mr. Jones owes — is slated for this yr.

“With out query, Jones is pushing the chapter system to its limits,” stated Avi Moshenberg, one of many households’ lead chapter attorneys.

A courtroom ruling that Mr. Jones should pay the complete quantity owed would ship a powerful public message, he added: “What a jury stated is unforgivable mustn’t and can’t be forgiven by a chapter courtroom.”

Elizabeth Williamson reported from Houston, and Emily Metal from New York.