By Dietrich Knauth
NEW YORK (Reuters) - Families who have sued Alex Jones over his false claims about the Sandy Hook massacre have resolved their disputes on how to divide the bankrupt conspiracy theorist's assets, clearing the way for a sale of Jones' Infowars platform, attorneys said at a Monday court hearing.
Joshua Wolfshohl, an attorney for the bankruptcy trustee in charge of selling Jones’ assets, told U.S. Bankruptcy Judge Christopher Lopez in Houston that the agreement would help get the bankruptcy "back on track" and clear the way for a new auction of Infowars.
Courts in Connecticut and Texas, where some of the families filed their lawsuits, have ruled Jones defamed the families by making repeated false claims that the 2012 school shooting, which killed 20 students and six staff members in Newton, Connecticut, was staged as part of a government plot to take guns away from Americans.
But the families had disagreed over how to pursue Jones’ assets after he declared bankruptcy in 2022, with the Texas-based families preferring to take more cash from Jones, while the Connecticut-based families prioritized the shutdown of Jones' Infowars company.
The disagreement helped scuttle a previous auction of Jones’ Infowars company, after the court-appointed bankruptcy trustee decided to sell Infowars to the parody news site the Onion for $1.75 million with the Connecticut families’ backing.
Lopez, who is overseeing the bankruptcy, later blocked that sale, saying that the trustee left “money on the table" by quickly accepting the Onion's bid without conducting a more robust auction.
Under the new agreement between the Sandy Hook families, the Texas families will be paid $4 million, with $1 million being paid within seven days of court approval, according to court documents. After that, the Texas families will receive 25% of future payments made to the Sandy Hook families, with the Connecticut families taking 75%.
The Texas families also agreed to limit their participation in the rest of Jones’ bankruptcy case, and to support the Connecticut families when necessary.
Avi (JO:AVIJ) Moshenberg, an attorney for the Texas families, said at a Monday court hearing in Houston, Texas, that the Texas and Connecticut families are now “100% aligned.”
“The settlement with the Texas families is a milestone event and puts the families back on the same side,” said Kyle Kimpler, an attorney for the Connecticut families.
The families' previous split reflected the relative size of the judgments awarded to them, which gave the Connecticut families much more leverage over Jones’ bankruptcy.
Courts in Connecticut awarded $1.3 billion to the Connecticut families, by far the largest claim in Jones' bankruptcy. Courts in Texas, meanwhile, awarded $50 million to two Texas parents, while several other Texas plaintiffs were still waiting for trials when Jones’ bankruptcy stopped their lawsuits from proceeding.
A lawyer for Jones said he would discuss the families' agreement with Jones. Lopez has set a hearing for next week to consider approving the deal.
After the previous sale to the Onion was blocked in court, the bankruptcy trustee received a new bid from First United American Companies - a company affiliated with one of Jones’ supplement selling businesses - for more than double the company’s previous $3.75 million offer.
The trustee expects to receive a new bid from the Onion as well, and he will evaluate both offers before seeking court approval for a new auction, Wolfshohl said.