What you are saying is we should allow a creditor (of many) to sell an asset to whoever they choose at a lower market rate because it's the right political move in this one case. Why wouldn't those rules be applied in other cases.. you can sell any asset for a dollar to yourself and the bankrupt person will still be on the hook for the total debt minus a dollar. Letting a single creditor value assets below marketrate and direct a sale to someone they wanted would be a completely unfair process.
One group of creditors said they were willing to abandon some of their claims, which means other creditors would have gotten a larger share of the smaller bid, effectively making these other creditors better off.
If they get it less, later, or more chaotically, or if that was the intent it is.
This guy should be living in his parents basement and barred from publishing on any significant media platforms. He's proven willing to exploit victims for personal gain to the tune of the millions of dollars.
Or why should he be prohibited from profiting from exploitation of crime victims via broadcast platforms?
Regardless of whether victims get paid money, they were harmed emotionally by Jones's outsourced harassment. They don't need money. They need justice in the form of peace from harassment. And Jones seems set on exploiting them and the courts for his own enrichment.
They don't have a judgement of ownership in infowars they have a debt and the court is forcing Alex to sell all assets to cover the debt. Then the rest is written off and he gets a black mark on his credit report.
There are rules around this process for a reason. If you allowed someone who has a debt judgement to just take over a company what is it's true value. Alex could try to value infowars at a trillion. So they put it up for an auction to get the real value. That's the fairest way for all cases.
Besides others are in line as well.
And killing the infowars brand means little in the short/long run. The real brand is Alex's name. It's not like his audience will suddenly not follow him to a new show with a new name.
It's a chapter 7 bankruptcy, the bankruptcy estate already owns the infowars assets.
> There are rules around this process for a reason. If you allowed someone who has a debt judgement to just take over a company what is it's true value. Alex could try to value infowars at a trillion. So they put it up for an auction to get the real value. That's the fairest way for all cases.
Specifically, the reason is protecting minority and junior creditors (including the debtor when assets are in excess of debts). If nobody offered up enough cash to pay off the debts in full and there is only one creditor who would rather have the business than the best cash offer, I don't think there'd be any reason for the courts to object. The big issue is, again, minority creditors getting less than their "fair share" of the assets, along with over-compensating senior claims with junior ones outstanding.
Neither are at issue here - The Onion's offer paid more cash to the minority creditors, the majority creditor opted into the deal, and the assets are clearly worth less than the debts.
Except Onion’s bid minimized Alex Jones debt and was the preferred outcome by his creditors. Offering more cash isn’t the same as making a larger bid here.
So because it’s not handing money to a specific person just everyone else, the math requires third parties to also be better off.
ps: Economic maximization alone isn’t relevant here. The underlying economic value matters when individuals aren’t voluntarily participating in a transaction. If I destroy your car then I owe you based on the cars worth, but if you trade in your car moderately under blue book perhaps you’re just in a hurry.
I think if the creditors unanimously wanted this to happen, it probably would not have been reversed over the idea that there could have been a higher value. The fact that this issue was raised to a court indicates that at least one creditor did not prefer it.
I’m simply agreeing with independent 3rd parties who state that The Onion’s bid was larger and better for the creditors. Alex Jones clearly doesn’t want his life’s worked turned into such an obvious mockery, but while he’d love to sell these business to his parents for 1 dollar but the courts are acting to maximize the transaction’s value. Thus he can only object in terms of monetary value not his personal preferences.
By one creditor agreeing to forgo their debt only if The Onion buys it, that single creditor puts any other potential buyer at a disadvantage. It seems the highest bidder, regardless of whether that is another Alex Jones entity, has a fair counterargument such that this type of sweetheart deal is not fair to interested purchasers.
In both cases the other creditors end up with more money and Alex Jones ends up with less dept. It feels unfair because you’re judging the debt as uncollectible, but they would be receiving more cash from other winners so they aren’t just sacrificing hypothetical money.
I’m sure if a large enough offer was made they would happily walk away with everything they would be entitled to, but losing some cash for a final fuck to someone who profited from their suffering and actively attacked them seems like a reasonable tradeoff.
If A owes B and C money and has to sell some asset to satisify the claim, the only fair way to value the asset is to sell it in the open market, an auction. If D will pay $5 for it and E will pay $500 for it, it would be unfair to both A and E if B waves his hands and say he forgoes his claim so long as D gets to buy the item.
I understand that InfoWars is likely being sold at auction because no buyer was willing to purchase it for a price that would satisify the debt before bankruptcy, but there is a nomzero chance that some buyer shows up and is willing to pay more for it than someone else specifically to keep it out of that particular buyers hands. Strange. Farfetched. Buy possible. And it wouldn't be fair to allow preference by those owed the debt as it defeats the fair market price process.
It also results in debtors getting out of more debt.
> I understand that InfoWars is likely being sold at auction because no buyer was willing to purchase it for a price that would satisify the debt before bankruptcy, but there is a nomzero chance that some buyer shows up and is willing to pay more for it than someone else specifically to keep it out of that particular buyers hands. Strange. Farfetched. Buy possible. And it wouldn't be fair to allow preference by those owed the debt as it defeats the fair market price process.
A blind auction happened and if someone had offered even 1% of Alex Jones debt for info wars they would have won. The specific deal setup by the Onion provided 1.7 million dollars to satisfy other creditors, but the Texas families are owed 49 million. So even if the Connecticut families agreed to accept nothing any deal handing more than 1.7 million to the Texas families would have won.
Further, while it seems impossible for Alex Jones to ever get out of this debt, the Onion deal got him closest to that possibility.
This is absolutely true. Other media people that lost their job or channel, handle on various platforms, typically refresh to the same number of followers within a year or two.
They get to garnish those profits, too.
https://www.reuters.com/legal/alex-jones-cant-avoid-sandy-ho...
> Conspiracy theorist Alex Jones cannot use his personal bankruptcy to escape paying at least $1.1 billion in defamation damages stemming from his repeated lies about the 2012 Sandy Hook elementary school massacre, a U.S. bankruptcy judge ruled Thursday.
> Bankruptcy can be used to wipe out debts and legal judgments, but not if they result from "willful or malicious injury" caused by the debtor, according to a decision by U.S. Bankruptcy Judge Christopher Lopez in Houston, Texas.
Bankruptcies have all sorts of exceptions like this for fraud, student loans, child support, unpaid taxes, etc.
The intent of bankruptcy law is to benefit the economy by allowing people and corporations to take risks and start over.
It's not to let them get away with defamation.
So there's a line between healthy economic risk-taking (bankruptcy discharges) and bad behavior (bankruptcy doesn't affect that).
you'd be surprised how many fall off from a migration. It's no different network effect from anything else. The hardcore will follow, the passive will fall off. Even a cult following like this isn't immune to this (simply more resilient).
>Is the issue that there are other creditors who are unhappy with this, who would get paid before the aggrieved families' damages would? The lawyers seem to be fine with it, as they're the ones advocating for this plan...
Based on discussions I've heard on this subject, a subset of the families was pledging money they didn't have in the non-competitive bidding. This is highly questionable. They may never receive the money they claim for the purchase. So by buying a real asset on the promise of money they aren't going to get, it is taking money away from other people who are rightfully owed money. If they wanted to do it the right way they could try to borrow the money from someone, but nobody in their right mind thinks Alex Jones has this money or ever did. The size of the judgement was calculated to lead to exactly this conclusion. As you said, the judgement was orders of magnitude more than the value of his company. So you should be satisfied with that. It is not necessary for the funniest possible outcome to manifest in order for justice to be served. Alex Jones will not go away because he has rights just like anyone else, and the legal process must conclude eventually.
Again, maximimum value not cash.
Is this a legal term or something? Not to be rude, but who cares what you mean by it? It's totally besides the point
Obviously "loosely speaking" is not a legal term but I'm sure there is one that means the same. I mean you need real money to buy things, not bad paper. Bankruptcy does not exist to deliver good feels to people, it exists to settle financial matters as objectively as possible.
Debt can absolutely be sold for whatever it is worth. In this case, the Jones' debt owned by the Sandy Hook families is fairly valuable to Jones' other debtors because it means they get a bigger slice of the bankruptcy estate. Thus the Sandy Hook families can offer enough of their Jones' debt in the sale to make it more valuable. (Edit: more complicated than how I explained it because both sets of debtors include Sandy Hook families)
This isn't any more "imaginary" than money itself.
Sealed bid auctions are not some absurd rarity in this sort of situation and I have no idea why you believe they are.
The auction was indeed very public. The bids were not.
The only requirement to participate was you had to show the Trustee that you were serious and had the means to participate. Only 2 parties did that.
The auction dates were published in newspapers and various news outlets announced that it was going to happen.
Nope. Under the rejected deal, other creditors would have seen a larger payout, because aggrieved families are actual two separate groups. One with a claim near a billion dollars, and other with a claim of only a few million (I think, it may be less).
As a result the aggrieved families with the larger claim were set to basically hoover up all the cash from the bankruptcy, and the deal with the Onion was to create a better deal for the other families by having the larger claim reduced to allow a fair split of the total cash raised.
It seems like there's an easy way for them to do that though: Just bid on it themselves and dispose of it however they want. They can bid arbitrarily high because they're the ones who get the money, if they want to dismantle the company or sell it to The Onion more than they want the money from what would otherwise be the highest bidder.
Although it sounds like maybe this was more of a procedural rejection than a dispositive one...
Except they weren't the highest bidder?
“The total value of The Onion’s bid was $7 million, including $1.75 million in cash put up by Global Tetrahedron, with the rest coming from the families of the Sandy Hook shooting victims, who essentially opted to put a portion of their potential earnings from a defamation judgment against Mr. Jones toward The Onion’s bid.”
> Judge Lopez said that the bankruptcy auction failed to maximize the amount of money that the sale of Infowars should provide to Mr. Jones’s creditors, including the Sandy Hook families, in part because the bids were submitted in secret.
Which implies they might just be able to redo the auction without secret bids and get the same result.
Once the price is known, several parties tend to walk away.
This is why you disclose the current winning bid, which will be <minimum bid increment> over the second highest current bid. If that's already more than you're willing to pay then you weren't going to win anyway. If it isn't, you can put in your bid and then the previous winning bidder has to outbid you again. Which they might do, but you don't know that and until the bid is above what you're willing to pay you don't lose anything by placing bids which as far as you know might actually win.
This is regrettable, but I don't think the court system offers a remedy sufficient for the grief Jones caused. This is why the court awarded what is frankly an absurd sum... truly, what is the point of awarding numbers that large? They're never paid out.
There this a strict defamation case, where the plaintiff's reputations were actually damaged in a way that harmed their income/worth, then we'd likely have seen a more rational award. Whatever it was that Jones did to these people, it's not the same tort as defamation. In that, he calls them embezzlers or pedos or something, they lose their jobs... and we can put a number to the damage he inflicted. Instead, he claimed they were actors, they never had any children, and this was some sort of hoax. Had crazy people coming out of the woodwork to harass them and stalk them. But the only sort of court order that could remediate that would be one that muzzles Jones from saying this shit... prior restraint. Something the Constitution wouldn't allow for.
I actually wonder if what he did shouldn't be characterized as a crime instead of a tort. Were he prosecuted and imprisoned (or even just put on probation), then the government would have the authority/leverage to (temporarily) prohibit this speech. Even then, he'd be made a martyr by his fans and it would continue as soon as the sentence was served.
But the logic seems a bit flawed... when you spend 2.1 billion in funding and then write it off on taxes, you are not saving 2.1 billion, you are saving YourTaxRate% of 2.1 billion, right?
The environment is lucky that it was Exxon who made the mistake of hiring an incompetent and overworked crew (per NTSB); they had more resources to deal with the consequences of an (allegedly?) drunk captain than smaller firms. I had a PhD relative working at Exxon whose work was halted and spent a year or two of his life working on the mess; not sure if that was part of the 2.1 billion or in addition to it. Certainly there was non-financial opportunity cost not even measured.
Like "Fire safety codes written in blood", the international requirement for oil tankers to have double hulls ensued.
I have to say, just as a matter of gut instinct, it sure feels like when the court finds that Alex Jones damaged people—at a value orders of magnitude beyond that of his company—those people should be allowed to decide that, to them, there's value in snuffing out his ill-behaving company altogether.
Is the issue that there are other creditors who are unhappy with this, who would get paid before the aggrieved families' damages would? The lawyers seem to be fine with it, as they're the ones advocating for this plan...