July 29 (Reuters) – The parent of far-right conspiracy website InfoWars filed for U.S. bankruptcy protection on Friday as the company and its founder Alex Jones face up to $150 million in damages in a lawsuit over years of lies it perpetuated for the Sandy Hook Elementary school massacre.
A bankruptcy filing by InfoWars’ parent company, Free Speech Systems LLC, would normally put the process and related litigation on hold. But Free Speech plans to ask a bankruptcy judge to allow the trial, which is currently being held in Texas, to continue and is seeking an emergency hearing on Monday, according to court filings.
However, Jones and his company could later try to use bankruptcy proceedings in another Texas court to limit the amount of damages a jury awards.
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A bankruptcy filing by three other InfoWars organizations in April offered $10 million to settle the litigation, far less than the Sandy Hook families are seeking. The proposal provides legal waivers protecting Jones and his company from lawsuits in exchange for the payment.
The previously bankrupt entities — InfoW, IW Health and Prison Planet — voluntarily dropped their cases in June after the Sandy Hook families dropped them as defendants in the defamation lawsuit.
Jones was found liable last year in lawsuits filed by Sandy Hook families after he falsely claimed the 2012 school massacre was a hoax. Read more
The unusual rulings came after Jones defied court orders to hand over documents in the litigation. The cases were then set for damages trials, the first of which is currently underway in an Austin, Texas, courtroom.
Jones claims the shooting in which 20 children and six school staff members were shot at the Newtown, Connecticut school was fabricated by gun control advocates and the mainstream media. Jones has since admitted the shooting happened.
Free Speech Systems believes it is in their best interest to continue the current compensation process, as significant resources have been expended on both sides and the Sandy Hook plaintiffs will likely struggle to continue the process despite the bankruptcy filing. W. Marc Schwartz, the company’s restructuring adviser, said in a lawsuit.
The Sandy Hook families opposed the previous April bankruptcy filing as a “sinister” attempt by Jones to shield his assets from liability. Read more
Explaining the current bankruptcy filing, Schwartz said the Sandy Hook litigation has resulted in InfoWars being shunned by significant Internet, social media and financial institutions. The company’s business suffered as a result, he said.
Mark Bankston, an attorney representing the Sandy Hook families, said he looks forward to continuing to present his case to a jury, which is expected to include testimony as soon as Monday from the parents of one of the children killed at Sandy Hook Elementary School .
“Our clients are pleased that despite the bankruptcy, their trial will proceed and that the jury will reach a verdict,” Bankston said in a text message to Reuters. “Now InfoWars heads straight for its long-awaited payoff.”
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Reporting by Mike Spector, Dietrich Knauth and Jack Quinn; Editing by Chris Rees and Stephen Coates
Our standards: The Thomson Reuters Trust Principles.
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