Fuck Judge Lopez for caring more about money than justice.
this post was submitted on 11 Dec 2024
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It's technically the law. Bankruptcy procedures are geared to enable the return of the maximum amount of proceeds for the creditors.
Sealed bid kind of torpedos that I suppose, but considering the shit stain on history that Infowars is, I feel like an exception should have been made here.
Sealed buds are usually better for that.
https://www.investopedia.com/terms/s/sealed-bid-auction.asp
Each party is incentivised to make the highest offer they're willing to pay from the beginning, as opposed to negotiating the best price they can get.
Additionally, the families forgiving a significant amount of money as part of the bid should factor in, since the responsibility of the estate is to get the best deal, not the most cash.
Sealed bids encourage last and best offers, and prevent the deepest pockets from submitting a "highest plus one" bid that minimizes the proceeds from the sale.
This judge is either a dipshit or corrupt.
Problem is why did that auction even happen or rather was allowed if it was technically now allowed for a bankrupcy case?
Feels like intentional so they can go "well, we don't like the winner. time to revoke it"
Apparently Jones chose a sham for his trustee who decided how to run the auction
Edit: "sham" as in how Jones saw it. After receiving only 2 bids, Murray—the trustee—decided to only solicit best and final offers instead of following the original open auction procedure; the court didn't expect changing those rules, but the change was completely within the trustee's power. Though both bidders had no objections to the changed rules, the lost bidder and Jones did after the results came out and sued, and the court felt like Murray should've done something else (while clarifying that they felt Murray acted in good faith).
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Judge Lopez said that the bankruptcy auction failed to maximize the amount of money that the sale of Infowars should provide to Mr. Jones’s creditors, including the Sandy Hook families, in part because the bids were submitted in secret.
“It seemed doomed almost from the moment they decided to go to a sealed bid,” Judge Lopez said. “Nobody knows what anybody else is bidding,” he added.
So the problem is that it didn't maximise the potential income for the bankrupcy case?
Shouldn't that be a "oh well, sucks. but a sale is a sale" problem?
It’s up to the lender to accept the settlement. They’re the ones taking the loss. The sale is not the result of financial hardship, so the court cannot force the lender to accept an unreasonably insufficient buyout offer for the loan.
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Shouldn’t that be a “oh well, sucks. but a sale is a sale” problem?
"A sale is a sale" works fine when both sides to the transaction are well-informed and acting for themselves. When you are selling assets for someone else's benefit, you generally have extra obligations to them, because otherwise you don't really have an incentive to achieve a good price. So courts do generally have some oversight over sale of the assets of a bankrupt estate, to ensure that the trustee is not short-changing creditors just to get the job done quickly.
A complicating factor here is that the Sandy Hook families (who as far as I know are the large majority of the creditors) also supported the sale.
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Apparently they also did not allow follow-up bids/outbidding others. It’s called a bankruptcy auction for a reason.
A first price sealed bid auction is a perfectly common type of auction.
It's functionally equivalent to an auction where you know the value of a thing (like we do a business being liquidated because the owner is in extremely deep unrelated legal debt), and the auctioneer starts by asking for the face value and then progressively lowers the ask until the first person accepts the price.
Instead of trying to get the lowest price possible, people are incentivised to start with their best offer for what they actually think the thing is valued. Allowing follow-up bids encourages people to low-ball and work their way up, which can reduce the price the seller gets for the item.
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And there's a trustee for a reason. The debtors decided that the value of keeping Alex Jones away from InfoWars had its own value and were willing to accept a lower bid. There's no fiduciary duty to maximize the proceeds from the sale, and Alex buying back his own assets during a bankruptcy auction is actual fraud.
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The market decided.
This can't be the first time the courts had to liquidate assets to pay for a civil suit, right? There must be an outline of some sort for them to follow?
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Follow the money
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