A company affiliated with conspiracy theorist Alex Jones has requested a federal judge to disqualify a bid by satirical news outlet The Onion to purchase Jones' Infowars at a bankruptcy auction, citing fraud and collusion allegations. The company, First United American Companies, submitted a $3.5 million bid at the auction, contending that it should be declared the winning bidder over The Onion.
The lawyer representing the company claimed that the bankruptcy trustee overseeing the auction colluded with The Onion and families of Sandy Hook Elementary School shooting victims to name The Onion as the winning bidder. The lawyer also asserted that the trustee violated sale rules set by the judge and that the company's cash offer was double that of The Onion's.
The bankruptcy auction was part of the liquidation of Jones' assets, including Infowars, with proceeds intended for Sandy Hook families and other creditors. Jones filed for bankruptcy in 2022 after being ordered to pay nearly $1.5 billion in defamation lawsuits filed by the families.
The CEO of The Onion's parent company issued a statement expressing disappointment at Jones' actions and alluding to his history of creating conspiracies. The bankruptcy trustee and a lawyer for the Sandy Hook families declined to comment on the matter.
The trustee dismissed the allegations as baseless, describing the company's motion as an attempt to influence the auction unfairly. The trustee filed court papers seeking approval for the sale of Infowars to The Onion.
The bid submitted by The Onion included a $1.75 million offer for Infowars, along with incentives from the Sandy Hook families who won their defamation lawsuit against Jones. The families agreed to forgo their share of the sale proceeds to benefit other Jones creditors.
The trustee highlighted that the families' incentives made The Onion's offer more favorable for creditors than that of the Jones-affiliated company. A hearing has been ordered by the judge to review the auction process and the selection of The Onion as the winning bidder.
Jones criticized the sale process, labeling it as rigged and fraudulent. The Onion plans to transform the Infowars website into a parody site targeting conspiracy theorists and promoting gun violence prevention efforts.
The company's lawyer alleged that the trustee changed the auction process from a live to a secret one, violating auction rules. The judge's order in September granted the trustee broad authority to conduct the sale in the best interests of Jones, his company, and creditors.
