Subchapter V was intended to help small businesses struggling to pay creditors – not toxic conspiracy theorists
The Infowars host and conspiracy theorist Alex Jones.Last modified on Sun 12 Jun 2022 12.51 BSTof spreading conspiracy theories that include suggesting that the Sandy Hook massacre was a staged event to ruminations that chemicals in our water supply were turning frogs gay. For a while – and even now – his business amassed millions of followers and made him rich. That didn’t last. Infowars, to the relief of many, is facing bankruptcy. But, no surprise, Jones is creating even more controversy.
If your business falls into this category, then the cost of filing for bankruptcy under the new subchapter V rules is much less and the process is much easier than doing so under the more onerous chapter 11 rules. You don’t have to form an official committee of unsecured creditors. You don’t have to pay a quarterly US trustee fee. You can take advantage of a reduced period to file a reorganization plan.
According to a report in Fortune, he did this by taking three non-operating entities, including his website Infowars, and filed for protection, naming the Sandy Hook plaintiffs as his creditors. He spread the estimated liabilities to be in compliance with subchapter V so the litigation would be delayed and averting the requirement of creditor approval to restructure. By doing so he attempted to protect Freedom Speech Systems and himself from liability.
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