By Dietrich Knauth
NEW YORK (Reuters) - Conspiracy theorist Alex Jones has asked a U.S. judge to convert his bankruptcy into a Chapter 7 liquidation, giving up on an effort to settle massive legal judgments related to his lies about the 2012 Sandy Hook Elementary School massacre.
Jones believes that "there is no reasonable prospect of a successful reorganization" of his debts, most of which stem from $1.5 billion awarded in defamation lawsuits, his attorneys said in a court filing late on Thursday. A Chapter 7 liquidation would not allow Jones to escape paying the legal judgments, but it offers a streamlined procedure for selling his assets under the supervision of a court-appointed trustee.
Courts in Texas and Connecticut have ordered Jones to pay $1.5 billion to the relatives of 20 students and six staff members killed in the 2012 mass shooting at Sandy Hook Elementary School in Newtown, Connecticut.
Bankruptcy can be used to wipe out debts and legal judgments, but the judge overseeing Jones' case ruled in October that most of the defamation verdicts cannot be legally discharged because they resulted from "willful and malicious injury" caused by Jones.
Jones said Tuesday on his Alex Jones Show that the Sandy Hook families were trying to shut down his broadcasts with "a made up kangaroo court debt." A spokesman for the Sandy Hook families declined to comment on Thursday.
Jones claimed for years that the Sandy Hook killings were staged with actors as part of a government plot to seize Americans' guns. Jones has since acknowledged that the shooting occurred.
The Sandy Hook families said that Jones' conspiracy theories caused grieving parents to endure years of threats and harassment, while Jones profited by driving traffic and sales on his Infowars website.
Jones had asked the Sandy Hook families to vote for a bankruptcy settlement that would have paid them $55 million, but they unanimously rejected the deal.
The Sandy Hook families instead offered their own proposal for liquidating Jones' assets, and U.S. Bankruptcy Judge Christopher Lopez will consider approving the Sandy Hook families' plan at a June 14 court hearing.
Because the bankruptcy will likely result in the liquidation of Jones' assets, Jones would prefer to liquidate his assets in a lower-cost and more streamlined court procedure, according to the court filing.
Jones initially filed for a Chapter 11 bankruptcy, which allowed him to retain control of his assets while working toward a debt restructuring plan. But Chapter 11 requires more spending on attorneys' fees and court fees than a Chapter 7 liquidation, and those costs now come with "little benefit," Jones' attorneys wrote.