A bankruptcy judge is set to hear arguments Monday in conspiracy theorist Alex Jones ’ effort to stop the satirical news outlet The Onion from buying Infowars and turning it into a parody.
Jones alleges fraud and collusion marred the bankruptcy auction in which The Onion was named the winning bidder on Nov. 14 over a company affiliated with him.
It’s not clear how soon U.S. Bankruptcy Judge Christopher Lopez in Houston will issue a ruling. He could allow The Onion to move forward with the sale, order a new auction or name the other bidder as the winner. At stake is whether Jones gets to stay at Infowars’ studio in Austin, Texas, under a new owner friendly to him, or whether he gets kicked out by The Onion.
The bankruptcy proceedings lower his overall payment by liquidating his assets and settling for lower amounts. It’s common to see people go through bankruptcy and then try to buy back their auctioned assets through an intermediary using undisclosed or borrowed funds. This is fraud, because if they had the means to acquire such funding, they should have used those funds to pay their debts instead of declaring insolvency. That’s why there is a trustee, to ensure that the bankruptcy auction is at arms length from the person who owes.
He’s trying to buy back his company so he can continue doing his show. The people he owes have an interest in making sure he does not continue to do his show, so they have every right to participate in the evaluation and selection of the bids.
Like, imagine Alex Jones owed $10 million and also owned a Picasso. Jones declares bankruptcy because he can’t afford to pay $10 million, and the painting is the only asset he owns. The painting goes up for sale, and there are two bidders. One is a museum offering $5 million, and the other is Blex Hones, LLC, an anonymous collector offering $6 million, who wants to place the painting in a private collection.
He’s trying to lower the amount he pays by $4 million and keep his Picasso. The people he owes are not fooled, and have an interest in seeing that the museum receives the painting so that it can be shared with the public. It is their decision to accept $5 million instead of $6 million, and they have no obligation to give Blex Hones, LLC another shot at bidding more. It is neither collusion nor fraud to take a lower bid because you prefer that buying receive the asset.