US judge weighs fate of the Onion's buyout of Infowars

By Dietrich Knauth

(Reuters) - Conspiracy theorist Alex Jones is set to urge a U.S. bankruptcy judge to block the sale of his Infowars website to the Onion news parody site at a Monday court hearing in Houston. 

The Onion was named the winning bidder for Infowars in a November bankruptcy auction, but Jones and a company affiliated with his dietary supplements sales have argued that the sale process was plagued by fraud and collusion.

Jones declared bankruptcy in 2022 and was forced to liquidate his assets to pay $1.4 billion in legal judgments to the families of 20 students and six staff members who were fatally shot in the 2012 massacre at Sandy Hook Elementary School in Newtown, Connecticut. Courts in Connecticut and Texas have ruled that Jones defamed the families by making repeated false claims that the mass shooting was staged as part of a government plot to take guns away from Americans.

The Onion has said it plans to re-launch Infowars in 2025 as a parody site filled with "noticeably less hateful disinformation" than before.

The sale must be approved in court before it is final. U.S. Bankruptcy Judge Christopher Lopez, who is overseeing Jones' bankruptcy, at a previous court hearing voiced concerns about the auction's transparency. The judge has asked the parties for evidence that he will consider at Monday's meeting.

The Jones-affiliated company, First American United Companies, was the runner up in the auction. It has claimed that the Onion benefited from a rigged bankruptcy auction and offered only half as much cash as the $3.5 million runner-up bid. 

It also has argued that the Onion unfairly received credit for lining up support from Connecticut-based Sandy Hook families that had won the largest legal judgments against Jones. 

Those families, who are Jones' largest creditors, boosted the Onion's bid by agreeing to forgo their right to any immediate repayment from the Infowars sale and instead take payments from the re-launched business's future revenue. A smaller group of the Sandy Hook families, who are based in Texas and won a smaller legal judgment against Jones, did not agree to give up their payment from the Infowars sale. 

Jones separately sued the Onion, the Sandy Hook families and bankruptcy trustee Christopher Murray, who conducted the auction, to oppose the sale. Jones has argued that the Sandy Hook families' legal judgments should not be treated as debts because Jones could still prevail on appeal in the defamation cases. 



Murray, a court appointee charged with selling Jones' assets, has said that the auction was fair, and that First American United Companies was trying to improperly influence the process after submitting an inferior bid that offered less value for Jones' creditors. 

Elon Musk's social media site X has made a limited objection to the sale, saying that Infowars' social media accounts are owned by X and cannot be included in a bankruptcy sale.

Source: Investing.com