Alex Jones Bankruptcy Trustee’s Sale Efforts Challenged by DOJ

The trustee appointed to oversee the liquidation of right-wing provocateur Alex Jones’ assets doesn’t have direct authority to sell the property of his Infowars media platform, a Justice Department unit told a Houston bankruptcy court.

A motion by Christopher R. Murray, the Chapter 7 trustee for Jones’ estate, to employ a sales broker to wind down the assets of Infowars parent company Free Speech Systems LLC should be rejected, the US Trustee’s office told the US Bankruptcy Court for the Southern District of Texas in a court filing Tuesday.

The Jones estate, which Murray now controls, has a 100% membership interest in Free Speech Systems, but not the company’s actual assets, the Justice Department unit said. Murray is tasked with with liquidating Jones’ estate to help him pay down approximately $1.5 billion in defamation judgments related to statements he made calling the 2012 Sandy Hook Elementary School shooting a hoax.

“While the U.S. Trustee is sensitive to the position of the Chapter 7 Trustee and commends his efforts to maximize recovery for stakeholders in the Jones’ case, because the Chapter 7 Trustee seeks in essence authority to sell property that is not property of the estate, the Court has no jurisdiction over that sale,” the US Trustee said.

Murray has other options, including working with employees and a manager on the wind-down of Free Speech Systems, and is entitled to proceeds from any sales that occur after a liquidation and creditors have been paid, the US Trustee said. But Free Speech’s assets aren’t property of Jones’ estate, and the trustee can’t ask the bankruptcy court to sell assets it doesn’t have property rights to, the US Trustee said.

Murray is also not allowed to hire professionals to liquidate non-estate asset or receive compensation on the liquidation of those assets, the US Trustee said.

A website to sell Infowars assets has already gone live, where bidders can potentially buy production rights and materials, more than 400 domain names, social media accounts, podcast sites, newsletter subscribers, product trademarks, and production equipment, according to the website.

In addition to his bankruptcy, Jones appears to also be in the midst of divorce proceedings. He filed for divorce on Sept. 9 from his second wife, Erika Wulff Jones, according to Travis County court records.

Jones’ bankruptcy filings show that he and his wife have a premarital agreement which requires monthly payments to her with a 4% annual escalation throughout the term of the marriage, plus reimbursement of expenses, and a periodic replacement of a vehicle.

Jones reported giving her about $759,000 in the year before he filed for bankruptcy in December 2022.

Jones has asked the Travis County court to enforce the premarital agreement, affirm that he has his own separate property, and hopes to strike a deal with his wife over the division of community property, according to court records.

The bankruptcy court in June converted Jones’ personal Chapter 11 into a Chapter 7, and tossed out Free Speech Systems’ separate bankruptcy, allowing the Sandy Hook victims’ families and others to pursue their judgments in state courts.

The court last week approved Murray’s request to sell Jones’ Austin lake house for $1.08 million.

Separately, victims’ families have asked the bankruptcy court to reconsider a prior order finding that Jones could use his bankruptcy to avoid $321 million in punitive damages awarded to them by a state court.

In October 2023, the Houston bankruptcy court ruled that Jones must face $1.1 billion in defamation judgments despite his bankruptcy because Texas and Connecticut state courts made clear findings that Jones’ conduct was intentional and malicious when he claimed repeatedly that the 2012 massacre was a hoax. But new trials would be necessary to determine whether the remaining $321 million can be discharged, the court ruled.

Attorneys for Jones, his wife, and the trustee didn’t immediately respond to a request for comment Wednesday.

The Chapter 7 trustee is represented by Jones Murray LLP and Porter Hedges LLP. Alex Jones is represented in the divorce proceedings by Minton, Bassett, Flores & Carsey PC. Erika Jones is represented in the divorce proceeding by Fullenweider Wilhite.

The case is Alexander E. Jones and Official Committee Of Unsecured Creditors, Bankr. S.D. Tex., No. 22-33553, objection 9/17/24.