The Onion’s move to buy Alex Jones’ Infowars out of bankruptcy is blocked by a federal judge

A federal judge on Tuesday night rejected the sale of the conspiracy platform Infowars to The Onion satirical news outlet after Alex Jones claimed that a recent bankruptcy auction was fraught with illegal collusion.

The Onion was named the winning bidder on Nov. 14 over a company affiliated with Jones. U.S. Bankruptcy Judge Christopher Lopez's decision means Jones can stay at Infowars in Austin, Texas.

The Onion had planned to kick Jones out and relaunch Infowars in January as a parody.

A trustee who oversaw the Infowars bankruptcy auction told a judge Tuesday that he picked The Onion's bid for the conspiracy-filled platform because was it far better than the only other proposal he received, from a company affiliated with Alex Jones.

Trustee Christopher Murray testified during the second day of a hearing where a judge is scrutinizing Murray's decision to name the satirical news outlet's offer as the winning bid after a November auction that Jones alleges involved fraud and collusion.

"Only two people showed up to bid and … one was just better than the other," Murray testified, referring to The Onion. Asked how much better it was, he said "by a lot."

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The Onion, which wants to turn Infowars' website and social media accounts into parodies, offered $1.75 million in cash and other incentives for Infowars' assets in the auction that concluded on Nov. 14. First United American Companies, which runs a website in Jones' name that sells nutritional supplements, bid $3.5 million

Although The Onion's cash offer was lower than that of First United American, it also included a pledge by many of the Sandy Hook families to forgo $750,000 of the auction proceeds due to them and give it to other creditors, providing the other creditors more money than they would receive under First United American's bid.

Jones did not attend the proceedings and instead broadcast from his studios in Austin.

"I can't imagine the judge would certify this fraud," Jones said on his show Tuesday. "I mean it's head-spinning the stuff they did and what they claimed."

The trustee and The Onion deny the allegations from Jones and the company and accused them of sour grapes.

The sale of Infowars is part of Jones' personal bankruptcy case, which he filed in late 2022 after he was ordered to pay nearly $1.5 billion in defamation lawsuits in Connecticut and Texas filed by relatives of victims of the Sandy Hook Elementary School shooting.

Jones repeatedly called the 2012 shooting that killed 20 children and six educators a hoax staged by actors and aimed at increasing gun control. Parents and children of many of the victims testified in court that they were traumatized by Jones' conspiracies and threats from his followers.

Jones has since acknowledged that the Connecticut school shooting happened.

Most of the proceeds from the sale of Infowars, as well as many of Jones' personal assets, will go to the Sandy Hook families. Some proceeds will go to Jones' other creditors.

Murray testified that he did not favor either bidder over the other and was not biased.

He also revealed that First United American submitted a revised bid in recent days, but he said he could not accept it because the Sandy Hook families in the Connecticut lawsuit objected.

The Onion valued its bid, with the Sandy Hook families' offer, at $7 million, because that amount was equal to a purchase price that would provide the same amount of money to the other creditors.

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In a court filing last month, Murray's lawyers called First United American's request to disqualify The Onion's bid a "disappointed bidder's improper attempt to influence an otherwise fair and open election process."

Murray's lawyer questioned him Tuesday afternoon, then Jones' attorney, Ben Broocks, cross-examined him into the early evening.

Broocks noted that the Sandy Hook lawsuit judgments could be overturned in pending appeals and got Murray to acknowledge that the Sandy Hook families' offer in The Onion bid could fall apart if that happens. That's because the percentage of the auction proceeds they would be entitled to could drop sharply and they wouldn't get the $750,000 from the sale to give to other creditors.

Broocks also questioned Murray about last-minute changes to the proposed sale to The Onion, with Murray responding that they were the result of different viewpoints on the numbers being settled.

Auctioneer Jeff Tanenbaum on Monday defended both the value of the bid and its selection.

Up for sale were all the equipment and other assets in the Infowars studio in Austin, as well as the rights to its social media accounts, websites, video archive and product trademarks. Jones uses the studio to broadcast his far-right, conspiracy theory-filled shows on the Infowars website, his account on the social platform X and radio stations. Many of Jones' personal assets also are being sold.

Jones has set up another studio, websites and social media accounts in case The Onion wins approval to buy Infowars and kicks him out. Jones has said he could continue using the Infowars platforms if the auction winner is friendly to him.

Jones is appealing the $1.5 billion in judgments citing free speech rights.