Bloomberg Law
Free Newsletter Sign Up
Login
BROWSE
Bloomberg Law
Welcome
Login
Advanced Search Go
Free Newsletter Sign Up

Alex Jones-Tied Company Seeks Probe of Infowars Parent’s Finances

Sept. 1, 2022, 4:20 PM

A company partially owned by Alex Jones is asking a judge to allow a court-appointed trustee to review the bankrupt Infowars parent’s finances, a request that could delay Sandy Hook victim families’ attempt to remove him from the Chapter 11 proceeding.

PQPR Holdings Ltd., which is owned by the right-wing conspiracist and his parents, on Wednesday said it would pay up to $100,000 for an examination of bankrupt Free Speech Systems LLC’s finances by the bankruptcy trustee working on the case.

Free Speech, a Jones-controlled company which operates his website Infowars, declared bankruptcy in July after a state court ordered him to pay judgments for his lies that the 2012 school massacre was a hoax. Last month, a jury awarded two parents nearly $50 million in damages.

PQPR’s motion comes after families of Sandy Hook Elementary School shooting victims last week asked a Texas bankruptcy court to remove Jones and his bankrupt company from running its operations and Chapter 11 proceedings.

The families’ requests to remove Jones should be put on hold until a trustee has reported its findings to the court, PQPR said.

PQPR, which is listed as one of the largest creditors of Free Speech, is partially owned by Jones through several limited liability companies and managed by Jones’ father, according to court papers. Jones father and mother also hold interests in PQPR via separate limited liability companies, according to court records.

“Having a comprehensive and impartial examination of the Debtor’s finances is a preferable alternative to protracted and perhaps unfounded, but certainly unnecessary, litigation,” PQPR said.

The victim families’ attempt to remove Jones is an “irredeemably flawed,” PQPR said in its filing.

PQPR markets and sells nutritional supplements on Jones’ show and website, contributes to most of Free Speech’s revenue, and holds much of Free Speech’s secured debt, according to court papers. That secured interest could make PQPR first in line to receive recoveries in the bankruptcy ahead of unsecured creditors such as Sandy Hook victim families.

The Sandy Hook victims’ families have argued that Free Speech “concocted” a $54 million secured debt to PQPR as a way to “shift assets and obligations as best suits their needs.”

The families also want the court to appoint an official committee to represent them as holders of tort claims, which would give them the power to investigate Free Speech’s finances.

Avi Moshenberg, a lawyer for the Sandy Hook families, told Bloomberg Law that they are trying foil Jones’ attempt to shift money to PQPR to avoid paying them.

“Alex Jones appears to be so threatened by that prospect that PQPR is now offering to split the baby with a proposal that lacks the necessary teeth and oversight to hold Alex Jones accountable,” Moshenberg said.

Jones’ lawyers could not immediately be reached for comment.

Free Speech and Jones are facing a second defamation trial in Connecticut scheduled to begin in early September.

The case is In re Free Speech Systems LLC, Bankr. S.D. Tex., No. 22-60043, motion 8/31/22.

To contact the reporter on this story: James Nani in New York at jnani@bloombergindustry.com

To contact the editors responsible for this story: Maria Chutchian at mchutchian@bloombergindustry.com; Roger Yu at ryu@bloomberglaw.com